Every individual has a CIBIL score that is calculated based on a range of factors. The CIBIL score essentially demonstrates your financial trustworthiness and can often determine the likeliness of you being approved for loans and other financial products.
In recent times, companies that are hiring are increasingly turning to the services of screening firms before hiring employees. These screening firms not only verify the applicant’s educational, medical, and criminal backgrounds, but have also begun checking CIBIL scores of applicants. The logic applied here is that an applicant with a good CIBIL score is unlikely to engage in corrupt or fraudulent activities. This is especially true for banks and similar financial institutions.
Employee CIBIL checks have become customary for a range of reasons, some of which are detailed below. While employment information in CIBIL score does not mention the specifics of where a job applicant has worked, it will indicate the duration of their employment and whether they have been steady in their employment history. Read on below to learn of the different reasons behind an employer checking the CIBIL score for employees.
1. Background Check:
Several companies consider a background check essential before hiring a potential employee. The employee CIBIL check can form part of the background check since if a job applicant is found to have a low CIBIL score, it may be reflective of a lack of discipline with financial matters
2. Evaluating Trustworthiness:
The CIBIL score is usually a factor for assessing an applicant’s trustworthiness. A higher CIBIL score demonstrates reliability and integrity, which companies would want in their employees. Especially in banks and financial institutions, integrity is considered a valuable quality in an employee.
3. Keeping an Eye on Reckless Nature:
While CIBIL score impact on job can be low, a bad CIBIL score may be indicative of an employee’s reckless nature with regard to their borrowings and repayments. Companies that gather employment information in CIBIL may consider this to be an extension of the applicant’s personality and consider it to assess the amount of responsibility an employee can take
4. Finding out Risky Financial Condition:
While the minimum CIBIL score for bank job may vary from bank to bank, a very low CIBIL score can certainly be cause for alarm. This is especially true when the low CIBIL score is due to delinquent accounts or several open accounts with pending payments. If you have ever wondered do companies check CIBIL score, you should know about this concern and understand that it relates to the risk of money laundering.
5. High Debt Trap Hampers Performance:
In recent years, it has become significantly easier to avail of loans of all kinds. Many people may opt for home loans, student loans, and even personal loans. However, a lot of people may not repay these loans within the permissible time and even default on occasion, both intentionally and unintentionally. This often leads to a debt trap, in which borrowers can get stuck for long periods of time. This is an undesirable situation for the borrower and can give rise to high amounts of stress, resulting in a decline in job performance.
Having a high CIBIL score is always beneficial. Having a minimum CIBIL score for bank job can be difficult, so it’s best to ensure your score is high before you apply for the job. Checking your CIBIL score is extremely easy through Bajaj MARKETS, where you can find out your CIBIL score in minutes.
There are certain parameters you can keep a check on to ensure that your CIBIL score does not fall too low. Read on below to learn more about these.
Repayment History: If you have credit cards or loans, make sure that you are paying the bills and making repayments regularly. It is essential that the payments are made within the dates specified by the bank or financial institution, otherwise it reflects badly on your CIBIL score.
Amount of Borrowing: Too much borrowing can also negatively impact your CIBIL score. Make sure that you are borrowing from a bank or financial institution only when it is absolutely essential. This can help keep your CIBIL score high.
Credit Mix: Credit mix refers to the mixture of secured and unsecured loans in your records. Ensure you maintain a healthy mix since too many unsecured loans can harm your CIBIL score.
Loans: Applying for too many loans can also negatively impact your CIBIL score. While not every lender will let you avail a loan, making too many applications will also hurt your CIBIL score. This is especially true for when you make too many loan applications within a short period of time.
Resolve Disputes: In some cases, false information could be recorded by lenders and passed on to CIBIL, which could result in you having a low CIBIL score. It is essential to keep an eye on your records to ensure this does not happen. If you find any sign of this on your records, make sure to raise a CIBIL dispute and inform the bank and CIBIL at once so that your score is not impacted.
If you have ever wondered, “Do companies check CIBIL score?” or “How much CIBIL score required for bank job?,” it is a good thing you are reading this article. Checking the CIBIL score for employees is a recent trend in India, even though it has been happening in other countries for many years now. Currently, CIBIL scores are only checked for senior level positions across the IT and financial sector, including banks. For instance, the State Bank of India (SBI) had released a job notice in 2016, which stated that the CIBIL score would be a criterion for the employee’s selection. It is safe to assume that more companies will soon be following this trend as it does offer certain advantages, and it is best to be prepared by following the steps above.
Keep a regular check on your CIBIL score through Bajaj MARKETS and take immediate steps if your score is too low.