If you are thinking of applying for a loan or a credit card, you might not want to ignore your CIBIL score. This score is going to decide whether you will get a loan readily or not. TransUnion CIBIL which was earlier known as Credit Information Bureau Limited is one of the leading credit information companies. The bureau accumulates and maintains the records related to payments against the credit products like credit cards or a loan. Financial institutions like banks, lenders and other non-banking finance companies submit credit records to CIBIL each month. CIBIL uses this information and accumulates a credit score along with a detailed credit report. This report and score are used by lenders to measure the creditworthiness, as well as assess the repayment capacity. CIBIL is licensed by RBI and is also overseen by the Credit Information Companies Regulations Act of 2005. TransUnion CIBIL is currently managing the records of 550 million customers and businesses.
What is CIBIL Score?
CIBIL or the Credit Information Bureau India Limited gives out a numerical representation which comes in a range of 300 to 900. The closer your CIBIL score is to 900, your chances of getting a loan or a Credit card gets better. Generally, a score of above 750 is considered good. When you apply for a credit card or a loan, the lender starts by checking your credit score as well as credit history to make a financially informed decision about whether or not to go ahead with the application. If you want to know about your score before sending in a loan application, the process is easy. CIBIL score is made up of various factors, including payment history, credit exposure, credit type and duration.
Getting a free CIBIL report
The Reserve Bank of India (RBI) made it compulsory for credit bureaus to offer one free credit report in one calendar year. These new guidelines were enforced in 2017, and CIBIL has to provide a free copy of the score to everyone who applies for the same. To get a free CIBIL report, visit the CIBIL website first. Click on the ‘Get Your Free CIBIL Score & Report’ and a new form will pop on the screen. Fill in all the necessary details including email address, your name, and also create a password, which will help you register your account on CIBIL. You can select the ID type that you want to use, including PAN number, passport number, voter ID number, driver’s license number, or ration card number.
While entering the mobile number, keep in mind that the number has to be working and handy, because the website will prompt an OTP in the next step. Click on ‘accept and continue’. Another page will prompt you to verify your identity using the OTP sent to your phone. Enter the OTP, and your score will be displayed on the screen. The service is free once a year, and if you want to use it multiple times, you will have to subscribe to the basic, standard or premium packs. The CIBIL report will contain your account information along with the score. The account specifics will include details of lender, account number and account type. If you have a score that is below 500, you will need to be more cautious on payments and dues. A good credit score is crucial for obtaining a loan or new credit card in the future. Other credit bureaus licensed by the Reserve Bank of India include Equifax, Experian and CRIF Highmark. They all vary in the costs and features.