CIBIL also known as TransUnion CIBIL Limited is one of the premier Credit Information Companies in India. Established in the year 2000, the credit bureau is India’s oldest Credit Information Company. It was formerly known as Credit Information Bureau (India) Limited, which was renamed to TransUnion CIBIL Limited later on.
Since its inception, the company has been primarily responsible for collecting and keeping record of the credit information. Currently CIBIL keeps the credit information of over 800 million people. Every month, member lenders, credit card grantors and other financial institutions submit financial reports of individuals and organizations. The credit bureau collects this data and refines it into comprehensible information, which is known as the CIBIL credit report. On the basis of the credit report, CIBIL credit score is given to every individual. The CIBIL credit score is later on used by the concerned entities to determine the creditworthiness of an individual or an organization.
What is a CIBIL Credit Report?
CIBIL credit report is a document that contains credit information of an individual. It reflects an individual’s ability to repay loan. A credit report usually includes an individual’s personal information, contact information, employment information, account information and enquiry information. An important thing to note here is that the credit report only shows your credit history, therefore, your net worth does not affects your credit score. Hence, your salary, business turnover, bank balance, investments, etc. does not constitute your credit report. However, owning a good number of assets may have an importance in getting loans in the future.
What is a CIBIL Score?
One of the segments in the CIBIL credit report is of the CIBIL score. The CIBIL score, also known as the TransUnion CIBIL score, numerically reflects the creditworthiness of an individual. It is a three-digit score that falls anywhere between 300 and 900. Good credit score implies that you have paid your credit bills and loan amount on time. Whereas, the bad credit score implies that you had defaulted in your loan and credit card payments.
Importance of CIBIL Score and Credit Report
Since there is always a risk involved in lending money especially in case of collateral-free loans, the banks and credit card grantors use the CIBIL or any other Credit Information Company’s credit score and credit report to make an informed decision regarding loan or credit card approval. Doing so will reduce the risk of loan defaults, thus, benefiting both the borrowers and the financial institutions. For the similar reasons, the Reserve Bank of India (RBI) has made compulsory for the banks and other financial entities to check the credit report and credit score of loan or credit card applicants before lending them money. The CIBIL score and credit report reflects an individual’s financial stability. It shows the lenders whether that individual will be able to repay the loan on time.
The credit reports are considered trustworthy as they are generated on the basis of data, which is submitted by the member banks and credit institutions every month to the CIBIL and other Credit Information Companies. The CIBIL classifies sorts, refines and compiles this data to give lenders and consumers a presentable and comprehensible credit report, which contains meaningful insights on different segments. People with good credit report have high credit score, which further increases their chances of getting a loan approved. Higher credit score also helps individuals to get favourable deals on loans from the lender. Whereas people with bad credit history, have low credit score, which becomes a hurdle for them when they need a loan approval. Low credit score also puts you at a disadvantage when negotiating loan policies. If you wish to improve your poor credit score, it is advisable to check your CIBIL score in every six months.
Is it Possible to Get CIBIL Score for Free?
If you are planning to apply for a loan, it is always good to check your credit score before applying for a loan or credit card. Doing so will help you to view your mistakes and check your eligibility for the loan. There is also a possibility that your report might have some errors, which you will need to report in time to avoid any delays in future. You can get your CIBIL credit score and CIBIL credit report, but it may not come for free. However, if you’re willing to pay, than you might get it for free as CIBIL allows anyone to get a CIBIL score and report for free from CIBIL’s website. As per the policies set by the Reserve Bank of India, it is mandatory for all Credit Information Companies to give CIBIL score and CIBIL credit report free once a year. In addition, you can also contact Paisabazaar.com to give you a CIBIL equivalent credit score and credit report that too free of cost.
How to Get the Free CIBIL Score?
If you wish to get your CIBIL score and credit report, you can apply for it online on the CIBIL’s website. On the CIBIL’s website, fill out the online Free CIBIL Score and Report Order Form. The form asks for your personal details such as name, address, gender, income type, monthly income, PAN details, and email address. Once you have filled out the form, don’t forget to accept the Terms and Conditions. Once you have submitted the form, you will be required to answer three to five questions about your Loans & Credit cards. This step is to authenticate yourself, therefore, perform it carefully. After successfully authenticating yourself, you will get your CIBIL credit report and credit score at your registered email address or via postal service. But if you don’t pass the authentication test, you will have to upload your KYC (know your customer) documents. After passing the authentication test, a hard copy of your CIBIL report will be mailed to you in about seven business days via postal services such as speed post or courier. If you have not received your CIBIL credit report and credit score within the stipulated period, enquire about the CIBIL’s credit report delivery status on their website.
There is another way through which you can get your free credit score and report. You can apply for free credit score and report at Paisabazaar.com. Paisabazaar.com has a simplified procedure to get access to your credit report and credit score. In fact, the company allows you to access your credit report free of cost anytime anywhere. In addition, where most companies charge money to give the consumers monthly updates, Paisabazaar.com charges nothing to help you meet your financial needs.