Credit Score India: CIBIL

Credit Score India: CIBIL

Credit Score is a new concept in India. In the debt ridden western countries (USA & Europe), Credit score is a routine practice and there are several credit score rating agencies over there.

However, in India there is only one Credit Score rating agency and that is – CIBIL – Credit Information Bureau (India) Limited.

Who Owns CIBIL?

The company is owned by a syndicate of banks now, but was originally promoted by the State Bank of India (SBI), Housing Development Finance Corporation Limited (HDFC), Dun & Bradstreet Information Services India Private Limited (D&B) and TransUnion International Inc (TransUnion). A number of banks, including Bank of India, HSBC, ICICI, Central Bank, etc, now hold stakes within this firm.

How do CIBIL Works?

CIBIL is a privately owned company, which collects credit information on over 140 million credit card holders and loan takers.

It gathers all of your credit information and store it on their servers. It helps banks, financial institutions and other financiers to share credit histories of retail and commercial customers. The bureau provides both positive and negative information about bank's borrowers, which empowers lenders in assessing the credit worthiness of potential customers.

So suppose if you go to ICICI Bank or HDFC Bank for the home loan than your bank may ask CIBIL for your credit score. And based on your credit score, your bank will approve or reject your loan application.

What is Credit Score?

A Credit Score is a 3 digit number between 300-900. Higher the credit score, the better.

It is decided based on your payment history, how many times you have default on your loan and many other factors.

So don’t think anymore that if you will default from the credit card from one bank, there is no problem. It is quiet possible that in the future you may not get approved for the home loan by any bank because of your bad credit score.