CIBIL was founded in August 2000.
CIBIL stands for Credit Information Bureau (India) Limited. This is India’s
first credit information company which maintains the records of individual’s
payments against the loan taken and credit card transaction. Based on the
records a credit score is arrived. This forms the basis for all financial
institutions to decide on the loan grant. Credit scores normally ranges from
300 to 900. As per a survey 79% of the loans are approved for individuals whose
score is greater than 750
| Courtesy : nextadvisor.com |
Now let us see what does various credit scores denotes to us.
Credit Score 300 – 600:
A score in this range means there
are unpaid loans and write off in the past. Default in payments would have been
done by the individual on multiple occasions. This is considered as highly
risky by financial institutions and loans would be rejected with such low
credit scores.
Credit Score 600-750:
This score suggest that there
were few delayed payments in the past while settling payments. This is a
moderate credit score and financial institutions would be extra cautious while
providing loans on such credit scores. They make ask for either a guarantor or
surety against the credit offered. Sighting the low credit scores the banks and
other financial institutions would spike their interest rates
Credit score 750 -900:
A score in this range is
considered a best score for offering loans. This score denotes that the past
payment history is good. In fact most of the cold calls are done by banks to
customers who fall in this bracket. So next time when you receive a cold call
from a financial institution, then you can safely presume that you have a
better credit score. The banks offer their best interest rates for individuals
with high credit scores. The individuals also get an opportunity to negotiate
on other fees like documentation charges, processing fee, pre-closure charges
etc.
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| Courtesy : eponafs.com |
The above summary makes it more
interesting for you as a reader to know what your credit score is. At the time
of inception of CIBIL such services where not offered to the public. Now an
individual can know his/her exact credit score from CIBIL by paying a nominal
fee. There are other avenues to know your credit score as well.
One such link is given by me in
this article below, which will help you in knowing your credit score for free.
The scores reflected will be a closest match to the actual credit score. Even
the values are not exact this will give an individual an indicative number on
where he/she stands when it comes to credit score and make amendments to ensure
the credit score is improved in the future. I tried to arrive at my credit
score and it was very close to the actual one.
Why to wait ??? Go ahead and check your credit score for Free!!!
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