Your Credit Information Report (CIR) holds valuable credit information that defines your eligibility in availing credit facilities, such as loans, credit cards, overdraft, etc. Primarily, it is necessary for you to analyse your credit information report before applying for any new credit products. Your credit report highlights your credit score that further assists lenders in the loan approval process. TransUnion CIBIL, being India’s most trusted credit bureaus, generates and maintains CIBIL credit reports for millions of consumers across the nation. You can check your free CIBIL score, download reports, and receive monthly updates without negatively impacting your credit score.
Importance of Credit Information for First-time borrowers
New borrowers may witness no credit history (NH-No History) or New-to-credit (NA-Not Applicable) remarks in their CIBIL report. To remove these remarks, firstly they need to start building their credit history by availing a secured credit card. Secured credit card is the best available option to begin with, as it is secured with investments and deposits that makes the borrower risk free for lenders. Secondly, fresh borrowers can also start building their credit history by applying for a personal loan based on their monthly income. To begin with, they can even start with a Short-term Personal Loan (STPL) that can be repaid within a few months to a maximum of 1 year.
Know your CIBIL Score
Knowing new borrowers’ CIBIL score is highly important before applying for any new credit product, as no bank or NBFC shall approve credit applications without any satisfactory CIBIL score. The CIBIL score depicts your creditworthiness and past payment behavior, which is signified by the three digit number that ranges from 300-900. Ideally, it should be maintained around 700 or above for new borrowers. However, first-time borrowers should strive to achieve their CIBIL score as close to 900. it might seem not easy initially as credit score increases gradually and is not an overnight process. Remain calm and be patient to witness the change by consistently and diligently trying to improve it.
Ways to Improve your CIBIL Score
By following the below mentioned measures, you can improve your CIBIL score and avail various borrowing benefits:
∙ Pay all your loan EMIs and credit card bills before due date
∙ Set reminder for payments to pay in time
∙ Avoid applying for multiple credit products in short time
∙ Maintain minimum credit utilization of available credit
∙ Maintain old credit accounts or credit cards to lengthen credit history
∙ Opt for longer repayment tenure
∙ Maintain healthy credit mix of loans – Opt for more secured loans rather than unsecured
Components of CIBIL Information Report
CIBIL Information Report or CIBIL report stores and maintains your CIBIL score, as well as contains vital credit related information of your availed credit products, such as loans, credit cards and various other credit products. Some of its key sections are mentioned below:
This section consists of your full name, gender, date of birth along with identification numbers, including PAN, Voter’s ID number and passport.
This section contains information about the borrower’s address, contact numbers and telephone numbers. In this section, you can add up to 4 addresses in your credit report.
Employment section contains information of the borrower’s monthly or annual income details, as provided by the lenders.
In this section will find all the account details of the lenders and availed credit facilities, such as loans, credit card, overdraft, etc. This section also contains information related to ownership details, account numbers, loan amount, first and last payment date, as well as current balance and a month on month record of your payments up to 3 years.
Enquiries section provides information of each enquiry being made by the borrower for any loan or credit card application that you may have made. Enquiries are registered in your credit report when lenders request for it from credit bureaus.
By now, you must have a fair idea and realised the importance of your Credit Information Report, as it provides all the necessary details of your credit products along with debt if any. Knowing about your CIBIL score and credit information report is always an added advantage, as it helps you take informed decisions regarding availing credit products. So, start building your CIBIL score now to enjoy all the borrowing benefits later and make yourself credit secure.