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The Credit Information Bureau (India) Limited, also commonly called TransUnion CIBIL, is the first Credit Information Company of India. CIBIL has taken the task of maintaining records of all credit-related activities of individuals and commercial establishments like companies and business, such as loans and other forms of credit. CIBIL gathers this information from various banking and financial institutes.
The CIBIL stands for catalysing growth of credit in India through solutions that enable well informed Credit decisions. So let’s bust some myths related to and around CIBIL.
CIBIL has refused my loan: CIBIL does not approve or disapprove loans. It just provides data about your credit score to the credit institution or bank.
CIBIL is a governmental or quasi-governmental entity: CIBIL is governed by an act of the government of India and has RBI authorisation. However, it is not a government entity.
CIBIL maintains the defaulters list: This is a common myth among people. In reality, the CIBIL does not maintain nor issue a defaulter list.
Information provided by CIBIL is fully accurate: Kindly note that data like personal details, account details, amount overdue etc. can sometimes be wrong within the CIBIL database, due to deliver erroneous reports.
CIBIL can change, my credit behaviour or info: CIBIL cannot change any information or data related to your credit history whatsoever. CIBIL can only include or update the changes with the authorisation of your bank.
CIBIL alone can give your Credit Report: RBI has also given this authorisation to other credit rating agencies like Equifax, Experian, CRIF and CIBIL to maintain and provide your credit report.
My CIBIL score is poor, no one will give me a loan: You can improve your CIBIL score and each credit institution has their own parameter to read a given CIBIL score.
My CIBIL score is good, can I get a loan from any bank? Apart from CIBIL Score there are also other criteria such as your income, loan amount, loan security and KYC which affect the approval of a bank loan .
I cannot check my CIBIL score: In order to check your CIBIL Score you will have to purchase a subscription from the options available which will give your own CIBIL report anytime.
Anyone can check my CIBIL anytime: You or only registered lenders like Banks can access your CIBIL, if you have applied to them for a loan or any kind of credit.
CIBIL score goes up if I file ITR: CIBIL has nothing to do with your ITR. Improve your credit behaviour if you want better scores.
Prepayment of a credit can adversely affect my CIBIL score: No, it does not affect your CIBIL score in any way, except shortening your credit history.
Checking my own CIBIL can pull down my credit score: It does not affect your credit score when you check your own CIBIL.
My income is high so my CIBIL score would be high: CIBIL is based on your credit record, not your income records.
A default of utility or post-paid bill will bring down my CIBIL score: Most utility bills do not report any of your transaction to CIBIL.
Using a debit card can improve my credit rating in CIBIL: CIBIL identifies your credit behaviours post utility of debit cards.
I am a co-borrower and second applicant so my CIBIL won’t be affected: If the main applicant has made any default, then all applicant and borrowers will be impacted and the credit score of all applicant including guarantor will be affected largely.
My name is in CIBIL so I won’t get a loan: Seeing your name in CIBIL is normal and if you have taken any loan from any banking institution or any bank then CIBIL will have your name for sure. As long as your repayment track record is good, having your name in CIBIL is good.
What is TransUnion CIBIL?
TransUnion CIBIL Limited is the first Credit Information Company in our country. It was previously known as a Credit Bureau. Here credit information is collected and collated.
These records are gathered from banks and other financial bodies and other lenders on a monthly basis. This report is used by lenders to approve loan applications.
Why is my CIBIL Score important?
The credit scores are very important for the loan application process. After the applicant has filled out the application form and handed it over to the lender, the lender checks the CIBIL score and report of the applicant. If the credit report is bad, the lender may not even consider the application.
What is a CIBIL Score and what factors affect my CIBIL Score?
Your CIBIL Score is a 3-digit number that sums your credit history. This history is derived from details collated from all banks, credit institutions, NBC and represented in the form of ‘Accounts’ and ‘Enquiries’ tab on your report that ranges from 300 to 900.
How can I improve my CIBIL Score?
Remember that your CIBIL Score will stay sunny as long as you understand the importance of timely repayment and a few other things:
Keep Your Defaults Low: Don’t use credit too much or too often.
Pay Dues on Time: Late payments are viewed negatively by lenders.
Take New Credit After Good Thought: Don’t show that you are continuously credit hungry.
Monitor accounts monthly: In a setup where there are co-signed, or jointly held accounts, as a borrower you are equally liable for missed payments.
A mix of credit: It is better to have a mix of secured and unsecured loans.
Review your credit history frequently: Monitor your CIBIL Score and Report regularly.