CIBIL: If you want to take any loan, then banks check you CIBIL score. What is this CIBIL score? Understand this, if someone asks you for money and you have to pay a large amount then you will see that will there be any problem in getting the money back. Is the other person capable enough to return the money? What is his track record? Has he borrowed from anyone before? If you have borrowed then how many days will it take to return it? Was there any hesitation in giving it back? If the money is returned in instalments, then were the instalments given on time or not? You will pay attention to some of these things. CIBIL is related to all these things. CIBIL score is mentioned while taking loan from the bank.
Let us tell you that Credit Information Bureau (India) Limited (CIBIL) is now known as TransUnion CIBIL Limited. This is a credit bureau and it is called a credit rating agency. It keeps records of credit related activities of people as well as companies. This includes credit card transactions, their clearance, review of loans and loan repayments.
CIBIL has its own website and accordingly the bureau provides information and tools for a clear understanding of credit history and financial credit. As far as business is concerned, the bureau provides powerful information solutions. This helps in taking better decisions.
CIBIL score or credit score in India is calculated between 300-900. Any person must take all possible measures to bring his credit score closer to 900. The higher the CIBIL score, the greater are your chances of getting a good deal on personal loan as well as credit card. It is easy for you to get any kind of loan. Let us understand the ranges of CIBIL score and what it means.
NA/NH
This means that it is either not applicable or the person does not have a history. If you have never used a credit card or taken a loan, you will have no credit history.
350 – 549
If your score is in the range of 350 – 549 then such CIBIL score is considered as a bad score. This makes it clear that you have been delayed in paying your credit card bill or loan EMI. With a CIBIL score in this limit, it will be difficult for you to get a loan or credit card as the risk of you becoming a defaulter is high.
550 – 649
If your CIBIL score is in the range of 550 – 649 then it is considered a fair CIBIL score. This shows that you are struggling to pay your dues on time. However, when you apply for a loan, you may have to take a loan at an expensive interest rate.
650 – 749
If your CIBIL score is in the range of 650 – 749, then you are on the right track. You must continue to demonstrate good credit behavior and raise your score further. For this you should follow more financial discipline. On this score the bank or lender will consider your credit application and may offer you a loan. However, you may still not have the negotiating power to get the best deal on the interest rate for the loan.
750 – 900
If your CIBIL score is in the range of 750 – 900 then it is considered an excellent credit score. This shows that you make regular credit payments and have an excellent payment history. Banks will also offer you loans and credit cards easily. This is because your risk of becoming a defaulter is lowest.
