Understanding how to make a credit score is a key part of financial planning. A CIBIL Score is a three-digit number between 300 and 900, based on your credit history. If you're starting out, it’s important to know how to build a CIBIL score—this helps determine your eligibility for loans and credit cards, along with the terms and interest rates offered by lenders.
How can I generate my own CIBIL Report?
Generating your own CIBIL Report is both essential and straightforward. Most credit bureaus in India, including TransUnion CIBIL, allow you to download one free credit report annually. You can use this free access to check your CIBIL Score as well.
Visit the official website of TransUnion CIBIL and click on ‘Get Your CIBIL Score’. If this is your first time and you do not possess a CIBIL Login, then you will be directed to register and create your user ID and password. To do so, complete the registration form by providing the information requested and accepting the terms and conditions. An OTP or one-time password will be sent to the mobile number you have provided to authenticate your identity. Once this verification process is completed, you can sign in and download your CIBIL Report. It is important to note, however, that beyond the free annual credit report, you will need to opt for one of the subscription plans for subsequent downloads.
Bajaj Finserv Credit Pass for credit monitoring and management
If you are looking for an excellent tool to help you keep an eye on your credit health regularly, consider the Bajaj Finserv Credit Pass as your perfect companion. When you sign up now during the limited-time offer period, you gain free year-long access to these impressive benefits:
- Personalised dashboard, for a total overview of all your credit accounts in one place, highlighting the factors that influence your credit score
- Real-time insights into your Credit Health Report
- Monthly updates to your CIBIL Score
- Credit Score Simulator, for predicting the impact of a new credit product on your CIBIL Score, before you apply for it
- EMI Calculator, to understand the monthly commitments involved when you opt for a new loan before you apply for it
- Pre-approved offers, so you are never left in a lurch
- Tips and tricks to improve your credit health
Tips to build your CIBIL Score
Building your creditworthiness takes time and patience, but it is more or less straightforward with prudent credit habits.
- Start early: The sooner you begin building your credit history, the better. If you are just starting out, consider applying for a credit builder loan or a secured credit card. You can also look into becoming an authorised user on someone else’s credit card.
- Regular payments: Paying your bills on time is one of the most crucial factors in determining your credit score. Late payments can adversely impact your score, so make sure to always pay your loan EMIs, credit card bills, and other financial obligations on or before the due date. Maintaining a clean history of repayment goes a long way in ensuring your score is healthy.
- Low credit utilisation ratio: Your credit utilisation ratio is the amount of credit that you use compared to your total credit limit. Keeping this ratio below 30% shows that you are not over-reliant on credit and can manage your finances responsibly.
- Healthy mix of credit: Diversify your credit portfolio by having a mix of secured and unsecured loans. Secured loans like home loans and auto loans, along with unsecured loans like personal loans and credit cards, can positively impact your credit score when managed well. However, this does not mean that you should apply for credit you do not need simply for the purpose of diversification. Remember, hard enquiries that occur when you apply for new credit temporarily bring down your score, and too many of them within a short span can make lenders nervous.
- Monitor your joint applicant’s credit behaviour: If you are a joint holder or guarantor of a loan, remember that any defaults made by others will affect your credit score as well. Stay vigilant and ensure that joint applicants are responsible borrowers.
- Check your credit report regularly: Reviewing your credit report regularly can help you spot errors and discrepancies that might be hurting your credit score. Immediately dispute them with CIBIL to get them rectified and safeguard your credit health.
Remember, financial discipline is the key to a high CIBIL Score. Start early, stay disciplined, and watch your creditworthiness grow.
How long does it take to improve your credit score?
- Improving your CIBIL score is a gradual process and can take 3 to 6 months with consistent credit behaviour.
- If you're wondering how much time does it take to improve CIBIL score, it depends on timely repayments, credit usage, and responsible financial habits.
- Wondering how much time it takes to update CIBIL score? Typically, CIBIL updates your score within 30 to 45 days after receiving new information from lenders.
A good CIBIL score can help you secure a personal loan with better terms and interest rates.
