The cibil score between 750 to 900 indicates the genuine profile of an individual. Due to scores in excellent ranges, you will get loans quickly at competitive interest rates. Although, a low cibil score affects adversely who requires money immediately.
Today all banks, NBFCs, and lending institutions make it compulsory to verify the CIBIL score of all applicants whether they’re defaulters or not. But there are smart steps to improve CIBIL scores.
You can face problems every time if your cibil score is below 750. CIBIL is one of the trustable credit rating agencies in India, it is the guidelines of RBI to report to the CIBIL in case of any default by a borrower.
If you are curious enough to improve CIBIL score, check your credit health status as per your score.
CIBIL SCORE | CREDIT HEALTH STATUS |
Below 750 | o Poor CIBIL score o Non-uniform repayment behaviour or late payment behaviour of EMIs o High/low risk of turning into a defaulter o Higher interest rate o Numerous credit inquiries |
750-900 | o Excellent CIBIL score of applicant o Uniform and No defaulted payments o Credit management wisely o economical interest rates o Easy for negotiation o decent credit report |
Continuous activities for CIBIL improvement
Improve cibil score is not include only one-day activity. It is the combined efforts of many days with extreme patience and self-disciplined. Group of activities for cibil improvement are:-
Find reasons for low cibil- It is one of the highly recommended steps, because without finding the cause you’re not able to find the best solution. Figure out the main causes behind your low cibil score and take steps accordingly.
Open Credit Account with Suppliers or distributor- If your business frequently does vendor financing, you can start a credit account with the suppliers. It will help to increase CIBIL score and create a positive impact on the credit profile of the business.
Maintain strong communication with a lender- If your communication with the lender is not strong in case of any default by mistake, they may take strict action. If you have any financial discrepancies ask the lender for more time.
Intensify credit card limit- Raise your credit card capacity and reduce card usage ratio, it builds your self-disciplined behaviour for a long time. It helps to keep a good constant credit score.
Full repayment of long-lasting loans- collective liabilities on your credit score report create an adverse effect on your credit health. Loans for the long term bring down your score lower and close all pending long-term loans.
Frequently asked questions [FAQs] for improve CIBIL score
How promptly my CIBIL score will increase?
It will take 6 to 12 months on average to reinstate your credit score. It is not possible to fix it immediately to achieve the credit goal you need hard commitment.
Is 600 a fair CIBIL score?
CIBIL score depends upon your credit history. A score between 500-650 is considered a fair score but you face some difficulty to get a personal loan because of the lower risk of default associated with it. Try to improve CIBIL score by more than 750.
Also read-
Details for Personal Loan Top-up