Updated on 21 Jan 2020.
CIBIL Score (also called Credit Score) shows the creditworthiness of an individual. Banks and financial institutions check the creditworthiness of the applicant by checking the CIBIL Score, especially in case of unsecured loans or credit cards, to evaluate the probability of whether the loan seeker could repay his debt or not.
Due to this reason, CIBIL score is a very important term in personal finance.
You can check your CIBIL score online for free at any time during the year ( January to December) free of cost. Before 2017, everyone has to pay INR 550 for getting a one-time credit score.
CIBIL Credit Score Meaning
CIBIL (Credit Information Bureau of India Limited) is the Credit Information Company (CIC) which collects & maintain the records of individual’s payments towards loans & credit card.
On the basis of such information, Credit Information Report or CIBIL credit score is created. The score is shown in a three-digit number ranging between 300 to 900.
The more is the CIBIL score, the better the chances of loan repayment.
Factors Affect Your CIBIL Credit Score
- Late payment of EMIs or credit card bills.
- If you default your credit card bills.
- Having multiple unsecured loans and credit cards.
- Overdue credit card limit.
- You are the guarantor of a defaulted loan.
- You have an add-on credit card and the primary cardholder is not paying the bills.
Why Check Your CIBIL Score
In case, you visit banks and other financial institutions for a loan, first of all, they check your CIBIL credit score to know about your creditworthiness. In a case of a low credit score, you will not get a loan easily (in most cases loan request gets rejected). A low credit score indicates, inefficiency to repay the debt.
To avoid such a situation, it’s better to check your CIBIL credit score at least once in a year. If you find something wrong or a low credit score, then you can take significant steps to improve this.
What Is The Best Credit Score
The more is the CIBIL score, the more will be the chances of approval of your loan. Score more than 750 is considered as the best score. Also see, utilize what CIBIL report says about this.
Improve Your CIBIL Credit Score
You can take the following steps to improve your CIBIL Credit Score
- Pay your EMIs and credit card bills on time. Never make late payments.
- Avoid having multiple loans and credit cards on a single name.
- Don’t utilize the full limit on your credit card. 60% -70% utilization of the specified limit is considered as good.
- Don’t even think about overdue balance on your credit cards.
- Make a gap of 1 year in between the two loans.
- Never be a guarantor because any default in payment will automatically affect your credit score. It’s better to avoid this.
I have also written a detailed article on how to improve CIBIL score.
Accounts Reflect In CIBIL Report (CIBIL Credit Report)
- All Loan Accounts
- Credit Cards
- Settled and Unsettled Accounts
- Joint Loan Account
- All Closed Loan Accounts
- Accounts Where You Are As Guarantor
- Holding Add-on Card
Your savings account, FD, RD or other investments are not taken in CIR.
What if You Never Had a Credit Card or Loan Before? Will You Have a Credit Score?
When you have not borrowed any loan or never have a credit card, there will be no updates about you with the credit bureau. CIBIL marks such cases as NH (No History).
Due to the lack of details, CIBIL will be unable to say anything about your payment behavior. In such cases, banks may not provide you unsecured loans or credit cards.
How Do You Establish a Credit Score?
Banks often check other factors such as your salary, income and employment stability, in the case of no credit history to determine your repayment capacity. These factors become the deciding factor in your creditworthiness.
The easiest way to build a credit score is, get a secured credit card. Banks offer a secured credit card against the fixed deposit. Due to security, you will get easy approval. Once you get the credit card, start using it on a regular basis and pay credit card bills every month on time.
Following this process for 6 months-12 months will establish a good credit score.
If you want to build your CIBIL Score through credit cards you can find your ideal card here 13 Best Credit Cards In India
Check CIBIL Score Online Free
Visit CIBIL.Com. You will land on the homepage as shown in the image below.
Scroll down the page and you will see the option of Free Annual CIBIL Score report.
Click on “Click here”.
Or Visit Directly Free CIBIL Report Page. The page Looks likes
On this page, You will see “Get Yours Now” button and click on that to go to create account page. You have to create an account on Cibil’s website to get the Free Annual CIBIL Score Report.
- “Create account” page will ask you about your personal information. You have to fill information related to Your name, Date of birth, Gender, Identity Proof ( Pan Card), Income type, monthly income, Full address with pin code, Telephone number and Email address.
All the Fields are Mandatory, so you cannot skip anyone.
- At the end of the same page, you see the submit button. After filling all details click on the submit button.
This is the process of registration with the CIBIL. Once you complete registration, you will receive an email on your registered email Id. You will get a one-time password (OTP)for login to check your CIBIL Credit Score.
Go to MyCIBIL Login Page . The same link you get by email. You will reach the following login page.
Fill your registered email Id, password (receive in email) and captcha. After submitting, you may ask to change your password. First, change your password and again login with the new password.
Once you have logged in, then you will get the below home screen where you will notice your credit score as below. You can also check your credit report by clicking on the ‘View Report’ link, as shown in the screenshot below.
Checking the CIBIL score is as simple as I have shown in the article. Just follow the above-mentioned steps & check your CIBIL Score for free.
Keep your CIBIL score healthy that will help you get easy loan approvals (also considering other factors) for important cases like home loan or personal loan.
The best way to keep CIBIL score healthy is by using a credit card regularly and paying credit card’s bill in time.
Hope this article will be helpful for you. Let me know your thoughts in the comments.