You have to be credit-worthy

You have to be credit-worthy
 
Of late, banks and other lenders are obtaining the credit history of loan applicants from CIBIL and are offering credit facilities only if the credit report is found satisfactory.
 
The CIR (Credit Information Report) of consumers circulated by CIBIL will henceforth be one of the important factors to consider a loan application.
 
What is CIBIL?
 
Credit Information Bureau (India) Ltd., known as CIBIL, is an independent organisation, rather a storage house of credit information of individuals and commercial establishments. CIBIL is promoted by State Bank of India and HDFC and has equity from the world’s leading credit repository agencies such as Trans Union and Dun & Bradstreet Information Services. CIBIL collects credit information of consumers and commercial establishments from its members, collates the information and circulates the information back to its members, on request.
 
The working pattern
 
Once an individual consumer (or commercial establishment) takes a credit facility from any bank/lender, the latter will forward the details of the borrower to CIBIL.
 
Similarly all member organisations will supply credit information to CIBIL. The members will also update the CIBIL at regular intervals on fresh credit facilities availed if any, repayment patterns, delinquencies, write-offs, legal action initiated etc, pertaining to their consumers.
 
The executives of CIBIL will pool such credit information, analyse the credit worthiness and prepare a report called CIR (Credit Information Report). The CIR will contain the gist of critical analysis of credit history of the consumer (or commercial establishment) with credit scoring.
 
The member establishments i.e. the lending institutions will have access to the particular CIR, which is stored on the website of CIBIL, which can be downloaded. The CIRs are stored on highly secured platforms and only authorised individuals of member organisations, who have been provided with the appropriate decoding software, can unscramble the information.
 
Credit score
 
Although the CIRs contain details of all credit facilities availed from different lenders, and types of loans like personal loan, housing loan, car loan, credit card facility etc. will be mentioned, the lenders’ names/loan account numbers are not revealed.
 
High scores (800-900) indicate excellent credit history, which is basically due to the individual’s good repayment track record, lesser exposure to credit, no cheques bouncing/delays and lesser enquires made for credit facilities in the past 12 months etc. A score ranging between 600 and 800 indicates good credit history and scores less than 600 indicate mediocre credit history.
Credit Sudhaar is India’s first Credit Health management & improvement company whose goal is to help clients to Restore, Enhance and Protect their Credit and make them credit healthy.
Courtesy: The Hindu
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