Credit Information Bureau (India) Limited (CIBIL), is one of India’s leading credit information companies. CIBIL comprises 2,400 financial members including banks, non-banking finance companies (NBFCs), housing finance companies and other financial institutions and holds credit information of more than 550 million Indians.
So, if you are having a credit history by availing loans and credit cards, it is very likely that CIBIL will have your data.
CIBIL creates a credit score and report based on your repayment ability and borrowing behaviour. A good credit score helps increase your credibility as a borrower as you will be allowed to access surplus funds at a nominal interest rate. Hence, knowing your credit score before applying for a personal loan is very important.
In this write-up, let us discuss how CIBIL services can benefit you and what various charges they entail.
How Important is CIBIL for Both Lenders and Borrowers?
CIBIL for Lenders
Lenders can gain insights into your credit behaviour based on the credit score and report generated by the CIBIL. This thereby helps your lender to assess the risk of default associated with your profile. Similarly, many financial institutions make smart lending decisions by filtering the high-risk applicants from loan and credit card applications.
Lenders consider your credit score while approving the loan. Hence, it becomes necessary for you to maintain a good credit score as it enhances your loan approval chances.
Credit score ranges from 300 to 900, and the higher your score, the greater the chances for instant approval. Generally, a score of 750 and above is considered an ideal score by many lenders, as it helps determine your creditworthiness.
CIBIL for Borrowers
You can build a good credit score by:
- Repaying debts on time.
- Maintaining a sound debt-to-income ratio.
- Staying away from applying for too many credit cards and loans.
If you apply for many credit cards or loans, you will be considered credit hungry, which can in turn lower your credit score.
Whenever you apply for a loan, the lender seeks your credit score from the CIBIL, for which the lender has to pay a certain amount as charges.
Additional Perks and Insights Offered
Apart from the credit score and the report, there are additional perks that you are guaranteed.
- Using the score simulator, you can find out how your current credit score can change based on your future credit behaviour.
- Based on your credit score and profile, you can receive customised loan offers.
- You can also receive a personalised credit score analysis and summary.
- If any credit score changes are updated, you can track and monitor the credit health.
Now that you have understood the importance of credit health, it is always advised to monitor and work towards building a good credit score. This will in turn enhance your chances of availing a high-value loan at nominal interest rates.
So, if you are planning to build your credit score, one of the best ways is by applying for a loan and repaying it timely. Why wait? Opt for a line of credit from FlexSalary; a loan offering product of a non-banking finance company (NBFC) called Vivifi India Finance Private Limited, which is registered with the Reserve Bank of India (RBI). With FlexSalary, you can avail the following benefits:
- It is easy to qualify for a loan.
- No fixed EMIs. Only easy repayments.
- Unsecured and open-ended credit.
- Interest will be charged only on the loan amount that is used.