What is CIBIL or Credit Bureau Score? Jump In To Find Out More

credit-bureau-report

Understanding the personal loan process in banks can be complicated for people applying for a new loan. At banks there is delay due to endless documentation, lengthy paperwork, off-line means of submission etc. Among these there is the rejection one has to face due to having No CIBIL Score.

Who is CIBIL and what is a Credit Score?

  • CIBIL stands for Credit Information Bureau (India) Limited.
  • It is India’s first Credit Information Company. CIBIL collects and maintains records of payments for loans and credit cards. They use borrower information to create a Credit Score.
  • This score is then used by banks to evaluate and approve loan applications.
  • It is important because it gives banks a report of what are the borrower’s past credit performances.
  • A good Credit Score depends on how regular you are while paying the monthly installments and if you have defaulted on any installments earlier.
  • Like CIBIL some other credit bureaus are CRIF High Mark, Equifax and Experian.
  • A good score would be anywhere near 900 and a bad score would be the opposite.

This illustration will help you understand the process better:

Illustration-For-How-CIBIL-Works
Illustration For How CIBIL Works

“I had not been prompt in paying my monthly EMIs. Nobody had directed me back then. If I knew my defaulted payments would affect my future loan applications, I would have been prompt.”

These are words of Prasad Seth, a salaried professional working in Bengaluru.

Prasad had earlier cleared a loan from a bank to pursue a Data Analytics Course. Now in need of a personal loan, he goes to another bank to get the funds.

Once Prasad filled up the initial forms and paperwork, his credit history was checked by the bank. Prasad’s loan application was DENIED. The reason given to him was that Prasad had defaulted and in some cases delayed payments of his EMIs while pursuing his Data Analytics Course. This had reflected in his credit history and negatively affected his CIBIL Score. Prasad was disappointed. On being asked what he learned from this experience? This is what he had to say:

“The CIBIL Credit Score takes into account past defaults, more than one loan being paid at the same time, usage of multiple credit cards and promptness in clearing credit card dues etc.”

 

Sounds complicated doesn’t it?

Loan Singh understands that not everyone has availed a loan before.

Just like Prasad realizes now, you need to keep in mind that by paying regular and timely EMIs, you are building a good credit history. Not just Loan Singh, but any other lender you approach, will offer better terms the next time you need funds. While you’re with us, we suggest you heed the reminders sent by Loan Singh’s dedicated Operations Team to be prompt in your EMIs.

  • We provide loans with full CIBIL score check, but if you have never availed credit before, you can still apply.
  • Our proprietary credit scoring model evaluates your current financial position and not your past credit behavior or credit card history.
  • Our loan process is completely online and you can even track EMI status on your personal online dashboard.

While you get your loan approved with Loan Singh, it’s important that you maintain or even improve on your CIBIL score by ensuring you make your EMI repayments on time. Simply ensure that

  • You do not default on our loan repayments
  • Keep enough funds in your account to pay your loan installments without defaulting

To know more, call us on 18008435353  or drop an email to hello@loansingh.com.

 

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