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Only 3 in 10 individuals have credit score over 800: Report
- Only 36% of the 50 million users of BankBazaar, an online financial product marketplace, have credit scores of 800 or more
- Most banks offer lower interest rates on loans to borrowers with credit scores above 800
Most banks in the country offer lower interest rates of 10-100 basis points (bps) on loans to borrowers with credit scores above 800. This shows how important credit score is to an individual's financial health. Yet, only 36% of the 50 million users of BankBazaar, an online financial product marketplace, have credit scores of 800 or more, as per a report revealed by the company.
The fourth edition of the BankBazaar Moneymood 2022 report added that close to 70% of the company’s customer base have a credit score of over 700 points. This includes the 36% users with a score of 800 and more points. The report highlights the credit purchase trends of the current year and the outlook for 2022.
The report further revealed that women are more conscious of their financial habits compared to men as over 72% women users hold a score of 700 or more, compared with 66% men. In the high scores category, 40% women reported scores of 800+ compared to 35.6% men, the report said.
To compare salaried and self-employed taxpayers, the former did better. About 69% salaried people had a score of 700 and more compared to 61.25% self-employed people and for scores above 800, the divide increased further with only 27.5% self-employed individuals falling in this score band compared to 40% salaried ones.
“In the last few years, there is greater transparency on how interest rates on credit products are set, and the role of credit score in the entire process. Consequently, people understand the need for a good credit score, and are actively tracking them. Women, especially, have been doing a better job of maintaining a good credit score, and thereby improving their chances of accessing credit. Nevertheless, there are gaps that need to be filled. While 67% people who check their credit score on BankBazaar had a score of 700+, only 36% of them had a score of 800+ – a score that would enable you to get the best rate on any credit product from most financial institutions,” said Adhil Shetty, CEO, BankBazaar.com.
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First Published:26 Dec 2021, 05:10 PM IST
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