CIBIL and Credit Score in India

Credit History is a an alien term to 99% of the Indians. So lets explore the necessity of Credit History in India.

Prior to 2003, many businessmen[small / petty traders / contractors etc] including large business houses such as Essar, Jindals etc would borrow heavily from one bank and due to their mismanagement would default on loan payment @ that bank and go and avail a second loan at another bank without the knowledge of the first lender. This led to severe rise in Non Performing Assets of Banks, mainly PSU banks.

In 2002, all the banks came together to form a Credit Bureau which would share only the Credit[Any type of Loan or Credit or Money borrowed] information of borrowers indexed on the basis of IT – PAN number. Thus Credit Information Bureau of India Ltd [CIBIL] was born. In countries like the US & Canada, even defaulting on paying your Rent or Cell Phone Bill, you can get reported to the credit bureau as a defaulter.

Thus if you avail a loan in SBI @ Kashmir and if you default on the payment, you can’t goto Mumbai and avail a loan in any bank because your data from SBI Kashmir is now reported to CIBIL.

Credit Lenders request for a copy of CIBIL report before lending. CIBIL report comes with a statistical score based on various factors and is known as CIBIL Score. This score is an estimate of an individual’s creditworthiness. The score tells the risk of lending to a person. So be very careful the next time you default on paying something.

5 Responses to “CIBIL and Credit Score in India”

  1. hello can u please tell within how many days they include my name in defaultrs list in cibil if i use the credit card and refuse to pay

  2. How can we calculate thc cibil score.what is the process of it.

  3. When a person has run into deep financial trouble due to heavy loan repayment & credit card outstanding, will any bank come forward for a debt consolidation loan at a moderate interest rate but for a long term so that with the funds available the person can foreclose all outstaning high interest loan commitments?

  4. Hello Sir,
    I am facing a lot of problem regarding which i need some expert guidance.

    I Ravinder Kumar Budhiraja and my DOB is 09-10-1981 . I have never take credit card from any bank but when apply a loan from bank bank told me that ur name is in CIBIL .and your a/m is 96270 is pending . But I know that I have never ever receive credit card from any bank .So kindly please let me know that how to know the name of the bank it is and to whome should i contact for ..? I have contacted the CIBIl by sending them lots of Email but I don’t think so that they people are in the mood for giving me any support, they just asking me the money and when I raised the issue at Consumer Court http://www.consumercourt.in/personal-loan/12006-defaulter-list-cibil.html they just told that I have a strong reason to drag the Bank to the Consumer Forum .If any one have any idea or faced such issue in past or facing such issue please contact me I need some help in Removing my name from defaulter list and form a group to fight against such agency who are forcefully taking our hard earned money.

    Regards
    Ravinder

  5. Thanks a million for sharing the information,

    This will also help other users.

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