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The CIBIL Score is a key determinant of your financial well-being. It is a 3-digit number that speaks to your creditworthiness, especially when availing of a loan or credit of any type. Lenders consider your CIBIL Score while approving your loan and new credit application and determining the terms to offer. As such, having an excellent CIBIL Score is ideal as this unlocks favourable deals, which may include lower rates or higher sanctions. You can check CIBIL Score to know where you stand and check if you meet the lender’s minimum requirements. 

Unless it is an emergency, you should always be aware of your credit score. Checking before applying can help you avoid sending an application with a high possibility of rejection. Moreover, checking your CIBIL Score often helps you stay aware of any discrepancies or errors in your profile. Often these can be a sign of fraud and only through frequent monitoring can you stay ahead and dispute issues before they get worse. All of these practices are key to maintaining a good CIBIL Score, but what does your score indicate? For answers to this question and to know how to check CIBIL Score, build, and maintain a good score, read on.

How to check CIBIL Score?

With several platforms offering free CIBIL Score checking solutions, it is possible to complete the process online in minutes. You can either log on to the CIBIL website to check credit score or use other service providers and tools from financial institutions for a free CIBIL Score check. You will be required to fill in a simple form with your details. This will include your name, birth date, ID proof, contact no, address, income, and other additional information. Once you get access to your CIBIL Score and credit report, read through to notice any errors and understand the factors that influence your score. 

What is a good CIBIL Score?

TransUnion CIBIL is among the top credit rating companies calculating your credit score. It takes into account the information sent by various financial institutions to generate your credit score. CIBIL considers four important factors, which include your repayment history, credit utilisation, credit enquiries, and the types of credit you have. Each of these factors accounts for a certain percentage of your CIBIL Score. Generally, a CIBIL Score of 850 and above is excellent and implies high creditworthiness. 

Subsequently, a CIBIL Score between 750 to 849 is great for your creditworthiness and a score between 700-749 is considered good. On a credit score check, if your score is below 650, you need to analyse and take the necessary actions to improve your score. 

Way to boost and maintain CIBIL Score

  • Make timely repayment to create a good track record

Your past credit behaviour plays a crucial role in determining your CIBIL Score. With regular and timely payment of your EMIs, you can improve your credit score. Not only that, timely repayment helps you avoid late fee payments. If you have multiple EMIs and find it difficult to keep a record of your payment, you can set autopay or reminders. 

  • Do not close old accounts and showcase a lengthy history

Having a lengthy credit history helps you display consistent behaviour, which can boost your credit score. But it is important to ensure that your oldest account has a positive impact rather than a negative one. This means that if you have an old credit and you have not paid the dues, it is wise to pay the amount and close your account. On the other hand, if a credit account displays good repayment behaviour you should not close it. Moreover, keeping your oldest account active also helps you maintain a good relationship with the financial institution. This can come in handy when you want to apply for a new line of credit or a loan. 

  • Maintain a good credit utilisation ratio

The credit utilisation ratio refers to how much credit you use against the available limit. A high utilisation ratio can negatively impact your CIBIL Score. As a rule of thumb, you should keep your ratio at 30%. If you have a credit limit of Rs. 1 lakh, do not exceed the Rs. 30,000 mark. Utilising a higher percentage of your assigned credit will cause your score to dip.  

  • Avoid displaying credit-hungry behaviour by making multiple new applications

Applying for new credit in a short period has several disadvantages. Firstly, each new application reduces your CIBIL Score momentarily. So, multiple applications will cause a noticeable dip. Secondly, these enquiries in your CIBIL profile are recorded and lenders can view this history. Applicants with several enquiries in a short period are viewed as credit-hungry individuals. This is a red flag to most lenders, and many are less likely to approve your application. 

  • Monitor your credit report 

It is vital that you check and review your credit report regularly. This is because it enables you to make the right decisions and actions at the right time. Moreover, as mentioned above, it can help you notice any misinformation or discrepancies in your report. These can lower your CIBIL Score, especially if it is a reporting error made by your lender. When doing a CIBIL Score check, free downloadable report options are available. Use these to get a detailed overview of your account. Remember that you may only get one free CIBIL Score check every year. 

With the right measures, you can easily improve your CIBIL Score and make the most of it. With discipline and the right credit management habits, you can boost and maintain a good CIBIL Score in no time. Moreover, knowing how to increase CIBIL Score is helpful as it teaches the common errors to avoid. Remember, an excellent CIBIL Score is a huge advantage for any borrower as it not only grants access to the best deals from the top lenders but also ensures easy access to funds via pre-approved offers. 

Disclaimer: This article is a paid publication and does not have journalistic/editorial involvement of Hindustan Times. Hindustan Times does not endorse/subscribe to the content(s) of the article/advertisement and/or view(s) expressed herein. Hindustan Times shall not in any manner, be responsible and/or liable in any manner whatsoever for all that is stated in the article and/or also with regard to the view(s), opinion(s), announcement(s), declaration(s), affirmation(s) etc., stated/featured in the same.

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