Learn How To Improve Your CIBIL Score

Credit information bureau of India limited maintains a track record of all loans and credit cards that a customer has of its member banks and financial institutions. It keeps a record of an individual payment status of all the credit accounts and keeps it collated for its members.

All this information is provided to CIBIL by its member institutions only so that a track is there for every customer who applies for a loan or credit card from any of the member.

On the basis of the performance in making the payments regularly or irregularly a specific score is given to every individual on its CIR (credit information report). This score is called CIBIL credit score. The score ranges from 100-900 and has a great impact on the rating of a borrower.

It helps the banks in deciding whether a particular person should be given a loan or a credit card or not. But the final decision is taken by the banks official only. CIBIL rating just reflects the previous as well as current state of the borrower.

A good score can get many benefits to the borrower like; Fast disbursal of loan, waiver in processing fee, loan on lower interest rate, high sanction limit for card etc. Whereas, If an individual has a low rating, he may not get loan and even if he gets the loan, it would be on a higher rate with small sanction amount and less tenure.

And so, it is very important to have a high CIBIL rating to overcome these problems and enjoy all the facilities that you want to avail.

Improve CIBIL Credit Score

Now that you have read all this, you must also be wondering how to increase your CIBIL rating. Here are some tips to improve your CIBIL score:

• First and the most important thing is to pay all your loan installments on time. And especially when you have more than one loan, you may find it difficult to organize and repay. Make sure that you do not miss to pay even a single payment toward your loan.
• Plan a budget for your family so that you are eligible to take a loan. It should not be like your case gets rejected after the processing.
• Make it a point that one of your cheque is bounced on the loan and credit card. Cheque bounces are considered as blunder and badly affects your CIBIL score.
• Always make the minimum payment due on your card and also make the complete payment on the card. The regular you are on your card payments, the more influencing image you gain.
• Do not unnecessarily keep on applying for cards and loans and overburden yourself. Only apply for any credit facility when you actually need one.
• Avoid going for settlements by making your payments regular. Do not be a non performer for months and get your account termed as a write off account. If there is a write off account in the CIBIL, then it will badly affect your score. Your score will be badly low.