How To

Step by Step Guide on How to Check Credit Score Online

Your credit score is a three-digit figure that represents your financial creditworthiness. It ranges from 300 to 900, and a high score means that you have a stable financial history with no late payments or defaults.

Lenders evaluate your credit rating whenever you apply for an advance to understand your money management skills. Usually, a credit score of 750 or higher is recommended for availing feature rich unsecured credits like business loans. It also improves your chances of getting a lower interest rate or better terms on the loan application.

Who determines the credit rating?

Credit rating is calculated primarily by four financial agencies. These include –

  1. Experian
  2. Highmark
  3. Equifax
  4. TransUnion

TransUnion CIBIL is rated as India’s top credit agency that collects, maintains and calculates the credit score. The primary role of CIBIL is to maintain a financial database of all lenders and borrowers. Keeping track of your CIBIL score can help you determine your eligibility to avail a credit from the financial market.

How to check credit rating?

You can check your credit report and score online from CIBIL’s official website. It is one of the fastest and most convenient methods of checking the details. The service is free for everyone for once every year; however, you must have an account on CIBIL’s website to check the rating and report. Here’s how you can do it.

  1. Visit the CIBIL website.
  2. Complete the provided application form with the necessary information like name, contact number, email address, and submit it.
  3. It will ask for some additional details like PAN, some other personal details, etc.

You will also have to answer some basic questions about your past loans and credit cards. These will be recorded to create a credit score and report. You will also receive a login ID and password which you will need to use to log in to the site in future and check CIBIL score.

Importance of the rating

CIBIL score is one of the foremost eligibility criteria used by financial institutions across the country. Lenders use it as an easy to understand representation and processed information to understand how much risk a borrower represents. Lending organisations prefer applicant’s with a high credit rating (750 or higher) as they are likely to have more chances to repay the debt on time.

Maintaining a high CIBIL score

A good CIBIL score improves the chances of unsecured credits like a personal loan for self-employed or a business loan and helps you reduce the processing time significantly. There are several factors that you can follow to ensure your business CIBIL score stays above 700; let’s take a look.

  • Consolidate and repay all your debts within the predetermined period to prevent any adverse effect on your credit rating.
  • Borrow funds only after repaying existing debt. It will keep the Flow and help you repay the debt without straining your finances. Maintain a positive working capital flow at all times. It will ensure you have enough capital to pay for the necessities and prevent draining your savings.

These methods are also some of the important things to do if your business credit score is low.

Credit score has become one of the most crucial eligibility criteria since the growth of the Indian lending industry. Thanks to the advent and implementation of the internet, the process to check one’s credit rating and report has also become significantly streamlined and time-saving.