- HOW IT WORKS?
- Credit Score & Report
- Credit Bureaus
What is a CIBIL Report? And Components of a CIBIL Credit Report:
Credit Information Bureau India Ltd (CIBIL) is a top most bureau in India which provides credit scores and credit reports for individuals and businesses. CIBIL has the highest security standard in the world and it has been given an ISO 27001 rating, which is quiet prestigious. It is a third party agency which gathers information about borrower’s credit history periodically in order to provide them with a credit report or credit score whenever there is a loan or credit requirement from a bank. CIBIL is one of the oldest among other credit bureaus in India, however there few which came up recently like Experian and Equifax. Credit Information Bureau India Ltd (CIBIL) is a top most bureau in India which provides credit scores and credit reports for individuals and businesses. CIBIL has the highest security standard in the world and it has been given an ISO 27001 rating, which is quiet prestigious. It is a third party agency which gathers information about borrower’s credit history periodically in order to provide them with a credit report or credit score whenever there is a loan or credit requirement from a bank. CIBIL is one of the oldest among other credit bureaus in India, however there few which came up recently like Experian and Equifax.
Credit Information Report (CIR) is the report provided by CIBIL and these reports have information related to an individual’s credit history usually sent by the financial institutions in India. The report usually consists of the history of payments made for various loans over a period of time; it does not include any information related to the individual’s savings or investments. The CIBIL score is a three-digit number that indicates the creditworthiness of an individual and that score is derived using the information provided in the credit report. Credit Information Report (CIR) is also called as CIBIL Report. It contains the detailed information about any credit facility availed in the past like home loans, personal loans, credit cards, automobile loans, business loans etc.
In simple words, the credit report allows lenders to identify the creditworthiness of the borrowers and avoid borrowers with poor credit history. Before they approve any sort of lending to you, the banks do some background check of any debt linked to your account and how regular the payments have been for those debts.
To be more specific, some of the major sections covered under this report are as follows:
- Overall standing: The first section shows the overall standing of the credit score. The score anywhere in between 300-900 is assessed based on the details collected in the inspection and accounts section of the report. The score generated is visually presented in different colors i.e. the closer score to the color green the better the score is. Any scores which are ranging b/w 700-900 are considered for approvals.
- Personal Information: This section is self-explanatory and it has general information about the individuals. Some examples are the name, DOB sex, PAN card number, passport, ID proof, and driving license and so on.
- Contact Information: This section contains all the contact details of the borrower like residence address, mobile or landline numbers and email address if any.
- Employment Information: This section has the employment type details and most importantly the income details i.e. individual’s income at time of opening the account for crediting the income and also their occupation. When it comes to occupation whether it is salaried or business, monthly income in case of salaried employee, annual income for proprietor or Partnership Company. Lastly the income indicator in terms of gross or net is also displayed.
- Account Information: This section is the most important sections of the CIBIL report is the account information part. It shows all the loans, credit cards, home loans, auto loans held by the individual singularly or jointly across all banks. If in case of joint accounts it includes loans availed by others where you may be a co-borrower and a guarantor. Along with all these details the opening date, last or latest payment date, amount of loan bought, current balance, any overdue amount and lastly the record of every payment starting from the first month to till the 36 month payments.
- Enquiry Information: This section will show the information about the vendors who may have probed into the credit application. The vendor’s name, loan type, loan amount, application date etc. can be found in this section. Any credit facility applications such as home loans, vehicle loans, LAP, personal loans, credit cards, are checked by the banks through this enquiry information.
CIBIL reports: How important are they?
- So just how much does a CIBIL score or report matter?The answer is very much, so much so that we can boldly affirm that your financial well-being is only as good as your CIBIL score or report, as they are the only sources relied upon by lenders in order determine whether or not you’re worthy of availing credit. Needless to mention, have a below par CIBIL score and bear the rejection brunt! Yes, a sub-par score of under 750 would mean that any credit cards or loans you apply for stand a good chance of being rejected. Have a score over 750 and you’re at the generosity of the lenders, see a great deal of credit cards and loans coming your way, with attractive interest rates to boot. This is simply because of your fabulous CIBIL score, as it clearly segregates the good borrowers from the risky ones, making lives of both lenders and borrowers easier than ever.
- CIBIL report and the bank:Financial institutions and banks gather borrower information to make sure they are entitled for credit cards or loans. From the statistical data, as much as 70% of the gathered borrower information matches with their CIBIL score and report. This is just how accurate the CIBIL report is. Given the fact that the financial institutions and banks are scrupulous and stop at nothing when it comes data or information collection about borrowers, and for 70% of this data to match with the CIBIL report is a testament to the veracity of the report, as it provides insights on a certain individual’s credit history. So, bank almost always rely on the CIBIL report for borrower information than any other source or information, and despite the fact that they themselves collect and retain borrower information. They check if at all you have defaulted on your payments in your financial life, as such events would have been recorded in the report. In summary, your CIBIL report or score will determine whether or not you are eligible to avail credit cards and loans.
- Where else does it matter?Do not take your CIBIL score lightly as it can make or break your financial life. Depicted below are a few factors that are affected by your CIBIL report or score.
- Credit card approval – A low or bad CIBIL score can dampen your odds of getting a credit card. More so, if you have previously defaulted on any of your cards, as this would have been recorded in the CIBIL report, and banks do not take such incidents in positive light. Only a decent CIBIL can tip the odds in your favor, resulting in easy issuance of credit cards.
- Loan approval – Your CIBIL score is a direct indicator of your creditworthiness to the lender. So, it’s safe to assume that a good score will get you the loans and a bad one doesn’t.
- Interest rates – The mantra is simple…the higher your CIBIL score, the lower will be your interest rates. This is because a good CIBIL score or report will set you up for competitive interest rates on loans and credit cards, and it also lets you negotiate the terms.
- Housing – An attractive housing loan can easily be availed through a good CIBIL score. You can even rent a place with a decent score.
- Approval for higher limits – Financial institutions and banks favor individuals with higher CIBIL scores. So, the higher your CIBIL score, the higher your credit limit.
A CIBIL report is an important source from where financial institutions and banks analyze an individual’s credit worthiness based on their borrowing history and repayment discipline. Some of the important features of CIBIL reports are:
- A combined report capturing your current and previous credit history.
- Helps you steer clear of debt traps.
- CIBIL reports are the foundations of approving loans to a debtor.
- Nurtures financial discipline through detailed reporting.
- Better CIBIL report score gives the leverage to negotiate interest rates.
Types of credit reports:
Credit Information Report (CIR) is a report that projects the credit history of the individuals from all the credit history details collected from the banks and financial institutions. Usually it is a numerically derived, 3 digit number and is also called as the credit score. A CIR is an important document of an individual which is usually referred to before approving any loans or credit cards by the banks or financial institutions.
The CIR comprises information pertaining to your credit history. Below is a list of the items outlined in typical CIR:
- Payment patterns – This is where you’ll find your last 3-month repayment history, including credit card and loan payments. Days Past Due (DPD) is the number of days by which the payment was delayed.
- Current unpaid balance – – Show your current dues to be compensated. This will show how good you are in making EMI payments, and whether or not you can benefit from more credit.
- Inquiries – This section has information on all the recent enquiries made with regard to your credit score. One should be wary of more number of enquiries, as prospective lenders may see it as extreme anxiety for credit. Rise in enquiries can also mean you were not an eligible candidate and as a result were trying to seek credit by approaching too many lenders.
- Latest credit requests – This section has your recent credit approvals.
- Company Credit Report (CCR) – A CCR typically gives a snapshot of a company’s credit history, collated from the statistics distributed by many financial institutions and banks in India. Whereas the CCR in no way does not replace credit reports for companies provided by a recognized agency, it is an important factor in processing loan applications.
The prime difference between a CCR and a credit rating is that the former is drafted from data put forward by banks, while the latter is generally sought by a rater and as a result, delivered by a relevant credit bureau after the related documents are evaluated and the company’s management are interviewed.
Lenders often make use of CCRs to make swift, informed decisions regarding loan approvals. A good CCR is a testament to the company’s strong financial posture and can be used to avail better credit terms from business associates.
How to get a TransUnion CIBIL report and score
The best way to get a credit report is by logging on to the official CIBIL website (www.cibil.com) report online and click on the “Know your score” tab in order to get a CIBIL report. This process if a complete paper less process and everything is dealt online.
The second step would be to fill a form which requests some personal and professional details. There will be fields related to their name, address, income, ID proofs, contact information etc. Once this is done, the page will redirect you to the payments page and you will have to pay a fee of Rs. 470/- for the request to be processed. Payments can be made through cards or net banking.
On making the payment, a verification page would appear and that will show about 5 questions related to your credit history. You must fill in those questions appropriately and you have to ensure at least 3 out of 5 are answered correctly in order to verify and validate your identity. Only when your identity is authenticated, the report would be generated within 24 hours. In some cases where the authentication fails, the paper copy of the completed application and address or ID proofs have to be sent to CIBIL by post.
There are no free credit reports issued by CIBIL as on date. But as per RBI notification dated September 1st, 2016 which was titled “Free Annual Credit Report to Individuals”, a free annual CIBIL report must be made available to everyone who wants it. Hence, from 1st of January, 2017, all credit bureaus including CIBIL, Experian and Equifax have to provide one free base level credit report with credit scores per year. That credit report should be almost the same as the one provided to the banks and financial institutions. Note: Once you have received your CIBIL score you can upload the same in creditseva.com to get detailed analytics, Close/Settle Old Loans and Credit Cards, Rectify errors in Credit Report, select options to improve Credit Score, Protect Credit Profile from fraud & ID Theft, Monitor Credit Report & get timely Alerts. Furthermore, to get a Free Experian Credit Report and Score just sign up with Creditseva.
The first step towards your financial well-being is signing up with Creditseva. tool and uploading your credit report that you have obtained from CIBIL. Once the report is uploaded this smart tool analyses the same and with the help of detailed analytics and graphical representation, understanding the report becomes very easy. Now you can settle old accounts, rectify errors, protect your identity from fraud, and also set reminders for various financial transactions. Once you have attained the desired score and making all your payments on time, you can avail new loans and credit cards from various banks.
Now it’s easy to become credit healthy!
Difference between a CIBIL report and CIBIL score?
CIBIL Score is a three-digit numeric summary of one’s entire credit history. This score is the resultant numeric summary derived from the information provided in the Credit Information Report (CIR). This score normally ranges between 300 and 900. The higher the score towards 900, the better the borrowers’ chances are, of their loan getting approved and vice versa.
One of the most important eligibility criteria for an individual to get a loan from bank is to have a good credit score. The credit score is a score based on the credit history of the individuals and is usually checked by the banks though CIBIL (Credit Information Bureau India Limited). It is an indicator of the credit history of an individual, and it is something which reflects the record of late payments, defaults on their loans and credit cards held in the past or current loans or cards. In many cases, the number of loans and credit cards applications submitted by an individual.
Dedication and diligence shown towards repayment towards loans or cards works in contributing positively for a CIBIL score. Any sort of negligence in repaying the payments for loans and credit cards will result in a bad credit history resulting in a bad score. A good CIBIL score determines the credit-worthiness of the borrower and loan/credit card approvals faster.
Whereas a CIBIL credit report on the other hand is a complete record of the credit history of a customer. It is basically a complete record of all the loans, credit cards payment behavior one had or has at the moment. Usually the payment behavior and credit history is noted down or recorded by any of the credit bureaus in our country.
In other words a credit report consists of all the information related to your lending from banks. It will project the loan amount, payment patterns, outstanding balance, opening date of the loan account, last payment made and any delinquencies or payment delays.
CIBIL Credit Report FAQs:
- How can you correct your CIBIL report errors?
In case of any errors in your credit reports or in case of any declines of credit card or loan Application, you can then contact CIBIL and communicate details of any errors in the reports. The Email Id is email@example.com.
- Is there any form that needs to be filled to apply for a credit report?
Yes, there is an application form on the CIBIL website that needs to be filled in order to get your credit report.
- What is the time duration to receive a credit report? It takes approximately ten days for the credit report processing and then it would be sent out. This will be done only when CIBIL receives the application form, supporting documents and processing payment online.
- What are the documents needed for the processing of credit report?
Application form, Photo ID and an address proof is all you need for the processing of the cred
it report. There may be a requirement of any additional documents if need be.
- Is there any time limit for the support documents to reach CIBIL?
Any support documents like Id or address proofs should be reaching CIBIL no later than 7 working days since the application for generating the credit report.
- How the report is be sent to me?
Usually, the credit report will be mailed by post or any courier service CIBIL is tied up with.
- In case the report is delivered in the absence of the receiver then what happens?
There will be only two attempts to deliver from CIBIL’s end to the address provided. If failed to receive both the times then the report will be sent back to CIBIL and the whole process has to be repeated from the scratch.
- What happens in case of any mistakes in the application form itself?
At any given point of time, CIBIL will allow up to 3 mistakes on the report. If in case there are any mistakes more than 3 then the application will not be processed further.
- What happens in case of any discrepancies regarding the address mentioned on my CIBIL account and the address on the address proof mismatch?
If there is any mismatch in the addresses on the CIBIL account and address proof, then the request simply be discarded. The address needs to be corrected and made to match by updating on the KYC documents and the supporting documents without fail.
- What are the means of payments for the processing the credit report?
Debit card, credit card, net banking or DD are the modes of payments for processing the Credit Reports.
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