022 4012 4545
10,000 people are
CreditVidya certified. Are you?
Visit Bootcamp Center
Imagine
that you are giving an important exam. Would you not like to know
the pattern in which the exam paper is set? What are the marks
allotted to each question? Which of the topics are more important
and require extra attention while studying? On what basis
will the examiner mark you? Is there negative marking.for instance?
Similarly we need to understand the CIBIL report to figure
out where the score can be improved.
CIBIL's Transunion score is a three digit number that the equivalent to marks that you get in an exam. Often due to blunders and ignorance, your credit score can be very poor. Luckily, the score can be improved and CIBIL regularly re-examines the elements of credit report and adjusts the credit score to reflect it. So if you are looking to improve your CIBIL score you need to understand the scoring pattern.
There are 5 parts to your CIBIL report
1. Actual Score
Your score is shown at the top of the report on a scale. Score of people with credit history longer than 6 months are between 300 and 900. The higher the score, the better your credit report. An ideal score would range between 800 and 900. If your score is below 700, it is time take a serious look at your finances and make some important changes.CIBIL has also provided for a risk index for people with less than 6 months of credit history. They will be graded on a risk index ranging from 1 to 5, where 1 would mean highest risk and 5 would mean lowest risk of default.
2. Personal Data
This section has nothing to do with your score, it is just information available for the creditor. It includes the borrower's name, date of birth, gender, PAN card details, other identifying proof details that have given for the Know Your Customer (KYC) norms including address and contact numbers.
3. Employment information
Again this section does not affect your score. It gives the employment information that has been mentioned while applying for the loan or credit card. At times lenders give preferential rates or pre-approved loans to borrowers working for certain employers such as large Indian or Multinational Companies.
4. Account information
This is the juiciest and longest part of the report. It is where different elements affect your score, pushing it up or bringing it down.
5. Enquiry information
This is a list of all of the people who have enquired about your credit: yourself, a lender, or any other authorized organization. Multiple "Hard" enquiries bring down the credit score they are enquires which come to CIBIL from lenders when you apply for a loan or a credit card. "Soft" enquiries do not affect your credit score. These soft enquiries generate when you ask for a report or a lender asks one without an application from you.
Rajiv is a credit expert with 10 years of experience in personal finance and consumer banking industry and another 7 years in credit bureau sector. Rajiv was instrumental in setting up India’s first credit bureau, Credit Information Bureau (India) Limited (CIBIL). He has also worked with Citibank, Canara Bank, HDFC Bank, IDBI Bank and Experian in various capacities.
Follow Rajiv on Google+ Email Rajiv© 2012 CreditVidya.com.
All rights reserved. Disclaimer: This information has been compiled and provided by CreditVidya.com as a service to the public. While our goal is to provide information that will help consumers to manage their credit and debt, this information should not be considered legal advice. Such advice must be specific to the various circumstances of each person's situation, and the general information provided on these pages should not be used as a substitute for the advice of competent legal counsel.