A good credit score of 700+ will help you easily obtain loans and that too at cheaper rates.
In this article, you will know 3 simple steps on how to check the CIBIL score for free in India. Before that, let’s understand what the CIBIL score stands for.
What is CIBIL score
CIBIL is a Credit Information Company in India that assigns a score to every individual who has taken a loan or credit card.
CIBIL score helps the financial institutions to manage risk and reduce the number of bad loans.
A high score indicates a balanced risk profile and better repayment capacity of individuals. Hence, banks and financial institutions prefer approving loans to people with a higher credit score.
Let’s check how to check CIBIL score in India
3 Easy Steps to Check CIBIL score FREE of Cost
Every year you can obtain one credit report free from CIBIL. You will be charged for more than one report.
I will help you with step by step process to obtain a free CIBIL report.
Step 1 – Create your account
Click here to access the myscore webpage of CIBIL website.
You will find a screen as shown below. The page asks you to create an account with CIBIL.
Which can be done by entering your username, password, first name, last name, email address, and mobile number.
When you are done click on the button “Continue to Step 2”.
Step 2 – More about you
Here you have to enter your date of birth, gender, address, and identity proof.
Acceptable identity proofs at CIBIL are
- PAN number
- Passport number
- Voter Id number
- Driving License
- Ration Card
You can also go through the terms and conditions details given at the last.
After you enter the details, click on the button “I Accept and Continue to Step 3”.
Step 3 – Verify your identity
Here you will receive an OTP on your mobile number.
Enter the same in the text box for OTP and click “Continue”.
Next, you will get the screen as shown below. Click on “Go to Dashboard”.
The dashboard will immediately show your CIBIL credit score.
You can also click on the tab – Credit Report to view the following information.
1. Personal Information
This gives your personal details like your PAN number and ID numbers of any other identification proofs that you have provided to your bank such as passport number, voter ID etc.
2. Contact Information
This will display the list of the addresses, telephone numbers and email addresses which you have provided to banks and other financial institutions over the last 10 years.
3. Employment Information
This will display the employment details you have provided to your bank in the last 10 years.
4. Account Information
This will display the details of all the loans you have availed, all the credit cards you have owned and all the overdraft accounts you had, since the time you first availed credit.
5. Enquiry Information
This will display the number of times your credit report was requested, the name of the bank/financial institution which requested a report, the date and the amount for which the request was made.
If you find that any of the data displayed in the Credit Report is not correct, you can raise a dispute by clicking on Dispute Center.
You can select the particular information for which you want to raise a dispute and click Submit.
The above steps entail you to obtain a free credit score from CIBIL.
There are other additional reports available for purchase such as
- Credit score analysis
- Unlimited access to credit reports
- Credit summary
- Score history
Financial accounts considered to calculate your CIBIL score
Irrespective of how much money you have in your bank accounts, if your repayment history is poor, no bank will approve loans to you.
CIBIL score ranges between 300 to 900.
Between 750-900 is the best CIBIL score
Banks would be too happy to lend credit to you and give their best offers.
Between 600-750 is a good score
You would get credit from banks but not their best offers.
Between 450-600 is an average score
You might still be able to get loans from some banks but the credit given to you will be categorized as a high-risk loan.
The loan be subject to additional terms and conditions.
Between 300-450 is poor score
Rarely, any bank would approve you a loan.
Factors that affect the CIBIL score
Debt repayment pattern
Any missed EMI will have a negative impact on your credit score.
Too many unsecured loans
CIBIL score drops when you have too many personal loans or high outstanding balance on credit cards.
A high number of applications
Your credit score reduces when you apply for too many loans within a short time period of 2-3 months.
Keep balance in using of credit limit
Have a higher credit limit and keep the utilization low in order to keep your credit score healthy.
Guarantor/Co-borrower for loans
Be careful when taking financial guarantee of anyone, their default will impact your credit score as well.
What should you do with low or zero credit score
Many people get shocked when their CIBIL score shows up as zero or -1.
CIBIL score of 0, means that there is absolutely no credit track record for the borrower. A score of -1, means that the credit track record is available for less than 6 months period.
In such a case just wait for some more time after availing a loan or credit card.
Below are some steps which you can take to improve your credit score.
#1. Clear your credit card dues
Clear all the EMIs and dues on time as any unpaid outstanding amount accumulated over a period of time not only increases your interest but also decreases your credit score.
You can even take a personal loan or borrow from family or friends to clear the outstanding.
#2. Avoid late repayment or EMI cheque bounces
Bank report delays in repayments to credit bureaus and the loan get marked as substandard.
Which degrades credit score. Hence, repay all your dues and EMIs for loans on time. If you have issued a cheque for EMI, ensure that there is sufficient account balance to honor the cheque.
#3. Obtain a small loan or entry-level credit card
Apply for an entry-level credit or get a secured credit card on fixed deposit. Use the card judiciously and repay dues on time. Which will be helpful for you to build a good credit score over time.
You can also avail a small loan from banks by submitting your pay slips or ITR.
#4. Use the oldest credit card to maintain credit history
The oldest credit card carries a proof of your borrowing and repayment histories over a long time. A credit card account maintained over a long period of time with a good repayment track record gives a big boost to your credit score.
#5. Avoid applying for fresh credit
Frequent requests to CIBIL for credit score decrease the credit score. Applying frequently for loans indicates that you are desperate for money. You can better to wait for a minimum period of 6 months before applying for fresh credit.
CIBIL score is one of the most important factors that banks consider while sanctioning any kind of loan.
Since one report is given free per year you can always check your score before applying for the loan.