Credit Score vs. Credit Report – What is the difference?

Confused about the difference between your credit report and credit score? The two may look more or less the same to new users but they are not. Let’s see how.

Difference between Credit Report and Credit Score 

Credit Score

Credit Report

Credit Score is a 3-digit number that represents how well you have managed credit, like a personal loan or  home loan or your credit cards, in the past. A credit score shows lenders whether you are a reliable borrower or not. When you apply for any kind of loan or a credit card, the lender bank or NBFC looks at your credit score and credit history that is maintained in your credit report.  Your credit score is calculated out of 900 and the higher your credit score, the better it is as lenders are more likely to approve you for new credit. Generally, a credit score of 750 and above is considered a good credit score.

A credit report is the collective data of your credit history which is used to calculate the CIBIL Score. It basically provides detailed information on your financial history such as history of loans, credit cards, etc.  A credit report is issued by various credit bureaus namely Experian, CRIF Highmark and Equifax. All matrices that are required to calculate the credit score are present in your credit report. These details include repayment history, number of loan accounts, age of credit accounts, number of hard enquiries recently, etc.

Who Provides Credit Reports and Credit Scores in India?

In India, credit reports are provided by various institutions, but the most commonly used is the one provided by CIBIL TransUnion. 

Other leading credit reporting organizations that currently operate in India include High Mark Credit Information Services, Experian Credit Information Co. of India and Equifax Credit Information Services. Most lenders consider the CIBIL TransUnion credit report as well as CIBIL score.

Note: At Paisabazaar.com, you can check your updated CIBIL score for free. The score thus reflected shall mirror with the one displayed on CIBIL’s official website.  

Connection between Credit Score and Credit History 

There is a direct connection between your credit score and credit report. If your credit report is good, so will be your credit score. A lot of red flags in your credit report are very likely to lower your credit score. 

A higher credit score on your report represents a lower credit risk for new credit provided to you and vice versa. Therefore higher your credit score, the greater is your creditworthiness as determined by the bureau and the lower is the perceived risk of lending you more money. So while your credit report contains your entire credit history, your credit score is a summation of the same and acts as a snapshot of your credit history with respect to all past and current debt instruments.

When you apply for a loan or credit card, the lender checks your credit score. It will help them determine the prospective borrower’s credit risk. The closer your score is to 900, the more will be the chances of your loan or credit card application being approved by the bank.

How to Access Credit Report and Credit Score?

To know how to get your credit score, follow the steps mentioned below:

Step 1: To check and download your free credit report, click here

Step 2: You need to enter the following details:

• Gender (Male/Female) 
• Full Name
• Date of Birth (DD-MM-YYYY format)
• PAN
• Email Address
• PIN Code 
• Mobile Number

Step 3: Now, enter the OTP sent to the mobile number in the pop-up screen

Step 4: Once done, tick mark the checkbox to provide Paisabazaar with the authorization to receive your credit information from credit bureaus

Step 5: Click on the ‘Get Your Credit Score’ button

Step 6: Your credit score will appear on the screen

To know how to access your credit report, follow the steps mentioned above till step 6 and then:

Step 7: Click on the ‘download report’ button

Step 8: Choose the language and month and then click on the ‘download’ button

Step 9: You need to enter the password i.e. Date of Birth (DD-MM-YYYY format)

Step 10: Your Credit Report will be downloaded

FAQs

Q. How many credit reports can I download and from where?

You can download free credit reports every month and this facility is available for lifetime at Paisabazaar.com.

Q. How many credit reports are provided by CIBIL every year?

One CIBIL Score and Report is provided by CIBIL without any charge every year.

Q. Do I need to provide my PAN to access my credit score?

Yes, it is mandatory to provide your 10-digit PAN number to access your credit score.

Q. My CIBIL Score is 450. How can I improve my score?

To improve your CIBIL Score, you must keep the following things in your mind:

• Pay your dues on time
• Keep your credit utilization ratio low
• Maintain a healthy credit mix
• Regularly check your credit report
• Keep your old accounts opened

Q. What should be the ideal CIBIL Score for loan/credit card applications?

 There is no minimum CIBIL score mentioned by lenders for approving the loan application. However, a Credit Score above 750 is usually considered good for availing a loan/credit card. 

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