Check CIBIL Score Online

What Is a CIBIL Score in India?

Your credit score or CIBIL score isn’t just a number on paper; it’s a door to the opportunity to qualify you for loans and credit cards. And the higher your score, the wider the lenders open that doors for you. It may sound complicated, but this guide will help demystify the concept at length.

The CIBIL Score is a 3-digit number that ranges from 300-900. The closer your score is to 900, the stronger is your credit profile. The score is derived using the credit history found in the CIBIL Report, also known as the Credit Information Report (CIR).

How is CIBIL Score calculated?

CIBIL Score is calculated by using an algorithm that revolves around loan and credit card repayment behaviour of an individual. The following 6 key factors are taken into consideration while calculating your CIBIL score:

Credit Mix

Keep a balanced mix of secured (home loans, auto loans) and unsecured credit (personal loans, line of credit). It can have a positive effect on your CIBIL score.
Debt to Income Ratio

Keep your debts such as credit card bills and mortgages lower than 50% of your income to improve your credit score. A higher ratio pulls down your credit score.
Payment History

Do not default on your EMIs. Making late payments and defaulting can negatively affect your CIBIL score.
High Credit Utilization

If your outstanding balance on your credit cards is high, it indicates an increased repayment burden, which can negatively affect your CIBIL Score.
Multiple Enquiries

If you have recently applied or have been approved for multiple loans and credit cards, the lenders may view your credit profile with caution as multiple credit applications reflect your debt burden.
Negative Status

Incidences like a written-off loan, foreclosure, filing for bankruptcy, account in the collection due to default in payments adversely affect your CIBIL score immediately. This warns your potential lender that you are unable to handle your finances for which they might face difficulty in recovering their money.

What is a good CIBIL Score?

What is a Good CIBIL Score?

Any score higher than 700 is a good CIBIL score. In other words, a score between 700 and 900 is what you should aim for. It indicates that you have been regular with your payments, and banks and financial institutions find you creditworthy. Some of the benefits of having a good credit score are -

A good credit score will fetch you better credit cards with higher limits and better deals.
Higher chances of getting a home loan, car loan, or personal loan. Since banks are assured of your financial behaviour and creditworthiness, they won’t reject your loan on this account, at least.
A good CIBIL score can help you negotiate or get a lower rate of interest on your loans.
You can bargain better and do away with extra expenses like processing fees, etc. on your loan application if your credit or CIBIL score is good.

What is a Bad CIBIL Score?

A score between 300 - 500 is considered to be a bad CIBIL score. A low, poor, or bad credit score is often a reflection of bad credit history. Hence, a bad credit score decreases your chances of getting a loan because your credit profile appears risky to the lender. Even if you are approved for a loan with a low CIBIL Score, it will be with a very high-interest rate. If your credit score falls in this range, it’s a red flag. Take serious measures to improve it.

Importance of CIBIL score for Personal Loan & Credit Card Approval

CIBIL scores play a crucial role when it comes to taking loans. When you apply for any kind of a loan, the first thing the lender does is download your credit report to access your creditworthiness.

If your CIBIL score is high, the odds of you getting a loan are high. You can also negotiate better loan terms and bargain on some fees and charges.

But if your CIBIL score is low, your chances of getting a loan approved are likely to be low. However, if you meet other loan eligibility norms, the lender may grant you the amount you need.

Credit Score	Credit Rating	Credit Report
This is a 3-digit number indicative of an individual’s credit health.	These are the credit scores assigned to a company or business.	This is documentation of your financial behaviour with regards to past and present loans and credit.
This can change over time.	This can change over time.	The information in your credit reports stays for 7 years. It is then replaced by new information.
This varies between 300-900.	These are denoted by grades like AAA, AA, B+, A+ etc.	This is a compilation of information.

Credit Score

Credit Rating

Credit Report

This is a 3-digit number indicative of an individual’s credit health.

These are the credit scores assigned to a company or business.

This is documentation of your financial behaviour with regards to past and present loans and credit.

This can change over time.

The information in your credit reports stays for 7 years. It is then replaced by new information.

This varies between 300-900.

These are denoted by grades like AAA, AA, B+, A+ etc.

This is a compilation of information.

750 and above	Great	Quick approval process and lowest interest rates
700 - 749	Good	Great interest rates
650 - 699	Fair	Limited options but can work in your favour
600 - 649	Doubtful	High interest rates
Below 600	Needs immediate action	Approval chances are very slim

What is a Credit Score?

What is the difference between CIBIL Score and CIBIL Report?

CIBIL Score

CIBIL Report