What is CIBIL?
CIBIL – Credit Information Bureau (India) Ltd. is an online agency which scores the credit history (credit repayment history) of a person. It bases its report on data collected from various financial institutions who are members of the Bureau.
CIB IL is licensed by the Reserve Bank of India and is governed by the Credit Information Companies (Regulation) Act of 2005. Their mission is to provide credit information that will help businesses grow faster and at the same time give cheaper and quicker credit to the people.
CIBIL Data and CIBIL-Score
Credit Information Bureau (India) Ltd. collect all the financial transactions of a person that related to the bank or any financial institution. The data includes,
- KYC (Know Your Customer) of a person
- Type and quantum of loans and
- Repayment history of the loans
Both prompt repayment and delayed repayment are recorded in the report. Even if you a guarantor or joint borrower to a loan, the data is captured.
The bureau summarises all these data and based on the set of data and scores it over a scale of (three-digit number) 300 to 900.
Benefits of CIBIL-Score
Financial institutions, mostly Banks depend on the score and credit history displayed in the report (CIR -Credit Information Report) to assess the credibility of a prospective borrower.
In most financial institutions there is a benchmark set for CIR scores and if the scores are below these benchmark levels the person might not be eligible for the loan. Ensuring prompt repayment of your loans ensures a healthy CIR score in turn.
A good CIB IL-Score ensures that you get a number of advantages over those having no CI BIL-Score or those having a lower score.
- Easy Credit from Lenders
- Quick Approval of Loans
- Low interest rate credits
- More Negotiation Authority
- Higher Approval Limits
- Exciting Credit Card Offers
Other Credit Information Agencies
We started off with the nameCIBIL because it is more familiar to us. But you may also note that there are other such companies too (commonly called as the Credit Information Company) too like CRIF, Experian etc. that work on similar grounds to score and provide data on your credit performance.
How to Check CIBIL Score Online for Free?
More than 70% of the loans are approved for an applicant who have a CIBIL score of more than 750. If you want to know your CIBIL score, you can follow the link.