Credit Score: How to Check & Why is it Important to Maintain?

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A credit score is a three-digit figure that represents your level of creditworthiness. Lenders look at it first when a borrower applies for a loan or credit card. It gives them a clue as to whether you’ll be able to pay back the loan on time. So, it’s important to keep your credit score high. You can maintain your credit score by making all your payments on time, checking your credit reports periodically, paying off any current credit card debt, and maintaining your credit utilisation rate under 30%.

How may one most effectively check their credit score?

CIBIL (Credit Information Bureau (India) Limited) should first be defined. A prominent credit rating agency that evaluates your creditworthiness in India is called CIBIL. Due to CIBIL, India can easily be called a financially literate nation. To increase understanding among financial institutions and enterprises about how to manage risks and limit bad loans, it has strengthened the financial markets’ openness, dependability, and organisational structure.

An online CIBIL score check is conducted. Banks and other financial organisations evaluate the CIBIL score before approving any loan. Regularly check your credit profile to make sure it appropriately reflects your creditworthiness and is free of mistakes and irregularities. This enables you to monitor changes and identify suspicious activities. Here are several ways to check someone’s CIBIL score online.

  1. Through the CIBIL website
  • Click “Get Your CIBIL Score” on the CIBIL official website.
  • Complete the form with the necessary information (Name, DOB, ID proof, loan history).
  • After submitting the form, you will be directed to the payment page. To obtain a credit report, CIBIL charges a fee.
  • After you’ve made your payment, you’ll be directed to the authentication page. For authentication, at least three of the five questions about your credit history must be answered accurately. The report will be provided to your mailbox within 24 hours after it has been validated.
  1. Use your PAN card to check your CIBIL score.
  • Visit the TransUnion CIBIL website to get a free CIBIL score.
  • Complete the form with the necessary information (name, DOB)
  • For ID proof, choose ‘Income Tax ID Number (PAN)’ and fill in the required details.
  • Select the sort of income and the amount of money you earn each month.
  • Submit your address and contact information, such as your phone number and email address.
  • Within 24 hours, you will receive the free report in your mailbox.
  1. Use your Aadhaar card to check your CIBIL score.

For address verification, an Aadhaar card is necessary. For all the ways to check CIBIL score online, the address given must match the address on the Aadhaar Card.

  1. Obtain a CIBIL Score by Entering Your Phone Number

Personal information must first be entered on the site to check Credit score via mobile number. The user must then confirm their identification by sharing the one-time password (OTP) that they are given. To see their CIBIL score, they must submit the same information on the next page.

Besides income, CIBIL Score is one of the most important factors lenders consider when approving loans. The Credit Information Bureau India Limited, in collaboration with different authorised credit bureaus throughout the nation, calculates the CIBIL score. Your payment record, payment behaviour, current credit outlets, and the quantity of credit you have are factors in your score.

The Indian lending industry has changed dramatically during the previous ten years. The credit bureau has increased financial literacy and urged consumers to keep their credit ratings in good standing. Since a personal loan is unsecured, such rules cannot be established. So, you can go for a personal loan for a CIBIL score of 550. Borrowers that are curious may get their CIBIL report and see where they are financial. When people know how much money they can borrow, it pushes them to keep their finances in order.

Why is it important to maintain a good credit score?

Most people will save hundreds of thousands of dollars over the course of their lives if they have a decent or exceptional credit score. Mortgages, vehicle loans, and other forms of finance are more affordable for people with good credit. Better credit scores are considered lower-risk clients, and more banks are fighting for their business by offering better rates, fees, and bonuses. Those with bad credit, on the other hand, are higher-risk customers, with fewer lenders competing for them and more firms getting away with illegally high annual percentage rates (APRs) as a result. Furthermore, because your credit score influences your ability to rent housing, rent a car, and even receive life insurance, having a bad credit score might make it difficult to find rental accommodation, rent a car, or even get life insurance.

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