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Overview of CIBIL

Set up in the year 2000, CIBIL, Credit Information Bureau (India) Limited or TransUnion CIBIL is the oldest and highly-reliable Credit Information Company in India which offers credit-related services to its member organizations. It has been gathering and maintaining credit-related information of Indian people, regularly supplied by various banks and nonbanking financial companies in the country.

CIBIL generates individual-level credit report and credit score based on all the financial information gathered from these lending establishments. On the other hand, the lenders make use of this CIBIL credit report to analyze the creditworthiness of loan/credit applicants, to ascertain if they should be extended the said loan/credit facility or not. 

As a result, CIBIL plays a very important role in the financial ecosystem of India. Going by the latest records, CIBIL has 2600 members on board, comprising of several leading private and public sector banking establishments, nonbanking companies, housing finance companies and other financial institutions.

The credit score calculated by CIBIL is popularly referred to as CIBIL score, which constitutes an important factor for lenders while they’re reviewing the loan/credit applications. It’s a 3 digit numeric figure that summarizes an individual’s credit history, and is calculated based on details found in the ‘Enquiries’ and ‘Accounts’ sections of the CIBIL report, factoring in all kinds of financial information including that of credit cards, loan accounts, payment status and outstanding amounts. This score is a reflection of a person’s credit worthiness, providing a fair idea about his/her repayment and borrowing habits, as reported by the lenders. It can range from 300 to 900. The higher this score is, the better will be the person’s chances of getting his/her loan approved. Almost 79% of all the loan applications in India are sanctioned for consumers with CIBIL score greater than 750.

Who all use CIBIL score?

CIBIL score as well as the CIBIL report is actively used by a large number of banks and financial institutions for evaluating the credit card and loan applications of people. It can be said that CIBIL score is the first financial impression that a lender gets of the prospective borrower. Not only do they consider it for deciding whether credit should be extended or not, but also while deciding the credit limit or the loan amount. Banks and NBFCs also keep a periodic check on the CIBIL score to ascertain the credit health of the borrowers.

Nowadays, even telecom operators are increasingly referring to the CIBIL score to figure out the credit limit that should be offered to their postpaid customers. Not just that, there have been cases wherein employers have checked CIBIL score and CIBIL credit reports of potential employees to determine how well they manage their finances.

Furthermore, CIBIL score is also regularly checked and used by individuals themselves, to stay updated about their credit health and how they get projected in front of the lending establishments. Based on this information, anyone can take remedial measures to improve their credit score.

Understanding CIBIL Report

A CIBIL report consists of multiple sections which provide detailed information related to the credit score and credit history of the individual. These components are:

CIBIL Score – The first component of the CIBIL report is the 3 digit credit score, calculated on the basis of the person’s credit behavior, as shown in the ‘Enquiries’ and ‘Accounts’ section of the report.

Personal Details – This section comprises of personal details like your name, date of birth, gender and various identification-related numbers such as voter ID number, passport number, PAN number, driving license number and Aadhaar number.

Contact Details – Your address and telephone numbers go into this particular section of the CIBIL report. Please note, there can be up to 4 addresses in this section.

Employment Details – Your annual or monthly income details as reported by various member financial institutions and banks, go into this section.

Account Details – This section consists of information related to your past credit record such as the kind of credit availed (overdraft, home loan, personal loan, car loan etc.), opening date, account numbers, lending establishment, loan amount, current balance, date of last payment, ownership details and monthly record of the repayments.

Enquiry Details – Anytime you submit an application for a credit card or a loan, the concerned bank or financial institution will access your CIBIL report to check your credit health. Every such enquiry gets listed in the CIBIL report and contains the name of the vendor, credit type, credit amount applied for and the application date.

How to get CIBIL Report?

As per an RBI directive, every credit bureau of the country including CIBIL must mandatorily provide one free-of-cost credit report, upon request of the individual, once every calendar year.

To access this free-of-cost CIBIL report, you’ll need to visit the official website of TransUnion CIBIL and access the ‘My Account’ tab on the top right hand side of the screen. Thereafter, click ‘Get Your Free Report’, which will provide you instant access to your CIBIL score and CIBIL report.