5 Ways to Increase CIBIL Score After Job Loss

A job loss is not good for your self-esteem, personal life, professional record, and financial profile. But it is a temporary phase of your life. Therefore apart from facing this traumatic time with utmost mental and emotional strength, you should also strive to increase your credit score to keep your credit profile unscratched.

The credit score is also known as the CIBIL score in India. You might be thinking about improving your CIBIL score and surviving in this challenging time. You can improve or repair your credit score by altering your lifestyle habits and resetting your priorities. Let’s dive deeper!

Is Credit Score Relevant for Job Search?

Although checking CIBIL score is not a widespread norm in India, certain employers do that to be doubly sure about your financially responsible behaviour. And whether it’s popular or not, your potential employer can access your credit score through your provided documents.

So, to be on the safer side, it’s recommended to increase your CIBIL score to improve your chances of getting hired. Also, if you work in the financial sector and your job provides you with the right to handle cash or finances of people and companies, your employer will be more inclined to check your credit score.

5 Ways to Increase CIBIL Score After Job Loss

Losing your job may sometime hurt your credit profile due to a lack of regular income. But you can turn the tables by being mindful of your finances. Here are 5 things you can do to increase and repair your CIBIL score.

Work on Your Repayment History

Your repayment history is a vital part of your credit profile. When you miss the due date of your utility or credit card bills, it gets reflected in your repayment history and ultimately in your CIBIL score. You can maintain your repayment history by paying all your bills on time. Try to make these payments before the due dates.

It will take time for your CIBIL score to improve. But by being consistent with regular bill payments, you will gradually reach an excellent CIBIL score.

Cut Down on Debt

You may have limited savings in your hands at such a crucial time. But while searching for your job, you can use some of your savings to close small loans. A nominal extra credit card bill payment also goes a long way to increase your credit utilisation ratio.

You always get good marks for being financially responsible with your debt from the credit bureau, which decides your credit or CIBIL score.

Don’t Request New Credit

While you minimise your debt to repair your CIBIL score, you also need to be careful to not apply for new credit. It might be tempting if a bank is offering you a personal loan. But applying for a loan without the means of repaying it would be a sure-shot way of disrupting your credit profile. Therefore try to manage your finance from whatever emergency funds or savings you have.

New credit or loan also means that a hard enquiry is run on your profile, which is not suitable for your credit profile. You should avoid it as much as you can.

Monitor Your Credit Report

It’s recommended to keep checking your credit report for inaccuracies every once in a while. But a human error causing inaccuracies such as not reflecting a payment or foreclosing a loan is possible. In that case, you will keep scratching your head about why your CIBIL score is terrible despite paying all your debts on time.

As a thumb rule, check your credit report every 6 months. Request correction in the report if you spot an error to repair your CIBIL score.

Clear All Your Dues

One of the quickest ways to increase your CIBIL score is to clear all your outstanding payments immediately. Late payment or penalties does not reflect a financially stable profile. If you keep your dues clear timely, you can get new personal loans or credit cards in the future.

Although applying for new credit is not advisable, you may need to do that when you have no money to fulfil your basic expenses.

A Quick Recap!

A low credit score may not be detrimental to your job search. But there are chances that you may lose a good job to a competitor candidate because of a low score. Therefore follow these 5 good practices to increase your credit-worthiness CIBIL score:

• Work on Your Repayment History
• Cut Down on Debt
• Don’t Request New Credit
• Monitor Your Credit Report
• Clear All Your Dues