Images: Shutterstock; Source: CIBIL
A Credit Information Bureau (India) Limited (CIBIL) score is a 3-digit numeric summary of an individual’s credit history. It ranges between 300 to 900.
The number shows your creditworthiness and is important while applying for loans, credit cards, etc.
A high CIBIL score can get your loans approved quickly. Nearly 79% of loans are sanctioned to individuals with a CIBIL score of 750 or above.
Most financial institutions require a minimum CIBIL score of 700 for issuing loans and credit cards.
Let’s see a list of factors that impact an individual’s CIBIL score.
Late payments or failing to pay EMIs leads to a lower CIBIL score as it impacts creditworthiness.
A balance of secured loans and unsecured loans can have a positive impact on one’s CIBIL score.
Multiple loan enquiries can have a negative impact on the CIBIL score as it indicates a heavy financial burden on the individual.
A high credit utilisation limit, which means that an individual is using a big proportion of their allowed credit limit, can negatively affect their CIBIL score.
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