CIBIL Score: Bank is not giving loans due to bad CIBIL score, this way your problem will be solved..

If you are thinking of taking a loan and your CIBIL score is bad, then you do not need to worry. Because you can easily take a loan only after having a bad CIBIL score. For this, you have to keep some important things in mind. Taking a loan to complete any important work is considered a conscious decision. However, your credit score can create some ‘problems’ for your future loans.

The Credit Information Bureau (India) Limited (CIBIL) score is a 3-digit numerical summary of your credit history. This is achieved using the details found in the ‘Account’ and ‘Enquiry’ sections of your CIBIL report. Reports are obtained including (but not limited to) your loan accounts or credit cards, and their payment status, as well as past due amounts. These details can be extracted with the help of a PAN number. The score reflects your creditworthiness based on your borrowing and repayment history shared by lenders (like banks).

Know when the CIBIL score is good
Let us tell you that your CIBIL score ranges between 300 to 900 and the higher your score, the greater the chances of getting your loan approved. The closer your score is to 900, the better your credit rating. Credit Information Bureau (India) Limited was incorporated in 2000 and started its operations in April 2004.
Following the enactment of the Credit Information Companies (Regulation) Act (CICRA) in 2005, three other Credit Information Companies (CICs) were also established. They are Experian, Equifax, and Highmark. However, the most popular credit score in India is the CIBIL score.

Why is the CIBIL score important?
Your CIBIL score is an important factor that lenders look at while evaluating a loan application. CIBIL score acts as a first impression to the lender, the higher the score, the better the chances of your loan being reviewed and approved. However, you must note that the lending decision entirely depends on the lender and CIBIL does not in any way decide whether the loan/credit card should be approved or not.

CIBIL score is affected by these reasons
Payment History: Making late payments or defaulting on EMIs has a negative impact on your score.

Multiple inquiries: Too many loan inquiries can have a negative impact on your score as it indicates that your loan burden may increase in the future.

High credit utilization: A high credit utilization limit indicates an increasing debt burden over time and can negatively impact your score.

Improve CIBIL score like this
You can improve your score by adopting a disciplined financial cycle, paying your credit card bills on time, not miss loan EMIs, never defaulting on loans, use credit wisely.

Timely payment of loan EMI is considered to be one of the important habits that helps in maintaining a proper credit history and a good credit score.

Monitor your CIBIL score report regularly. This will act as a warning for any possible inaccuracies. If you find any discrepancy/mismatch, you can report the same on the CIBIL website or request the lender to report the correction to CIBIL.

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