CIBIL/Credit Score Range - Complete & Updated Information
Your CIBIL score will range between 300 and 900. The higher the score the better your creditworthiness is.
In case you apply for a loan or credit card, the CIBIL score is an important factor that is considered by lenders. Lenders provide loans at low interest rates if your CIBIL score is high. On the other hand, interest rates on loans are high if your credit score is low.
The CIBIL score determines an individual's creditworthiness. However, loans are not provided immediately even if your CIBIL score is high. Several factors such as your income and financial portfolio will also be considered before the lender provides a loan or credit card.
Different CIBIL Score Ranges:
The different CIBIL score ranges are mentioned below:
Below 500
In case your CIBIL score is below 500, the loan or credit card application in most cases will be rejected. A score below 500 is likely because of several default payments. It is possible to improve your credit score, however, it will take some time.
Between 500 and 600
In case you fall within this bracket, it may be very difficult for you to avail a loan. You will need to maintain the right credit mix, pay your Equated Monthly Instalments (EMIs) on time, and pay your credit bills on time to improve the CIBIL score.
Between 600 and 700
If your CIBIL score ranges between 600 and 700, lenders may provide a loan at high interest rates. It may also be difficult for you to avail a loan with better terms. A CIBIL score in this range indicates that there has been a default or delay in payments in the past.
Between 700 and 900
If the CIBIL score falls between 700 and 900, your creditworthiness is high and loans may be provided at low interest rates. A credit score between this range also indicates that bills are paid on time and you are financially responsible.
Why is a Good CIBIL Score Important?
A borrower with a good or high credit score is considered low risk to lenders as it reflects their creditworthiness and past credit behaviour. Therefore, it facilitates easy loan application processes and quick credit card approvals for customers. A high credit score improves the borrower's negotiating position and raises their likelihood of being approved for the best loan offers.
How Does the CIBIL Score Impact Loan Applications?
In India, the RBI has granted licences and authorization to four credit bureaus to compute and produce credit scores for individuals all over the country. Based on the credit data provided by banks, non-bank financial institutions, and other financial institutions, these credit bureaus create credit rankings and scores for businesses, companies, and organisations each month.
The four major credit bureaus in India are as follows:
- TransUnion CIBIL
- CRIF High Mark
- Equifax
- Experian
It is important to note that the algorithms used by each Indian credit bureau to determine credit score and credit rank vary. Higher credit scores are associated with a decreased likelihood of loan applications being denied by lenders.
Ways to Improve the CIBIL Score:
The different methods by which you can improve the CIBIL score are mentioned below:
- Grow your credit history slowly.
- Check your credit history on a regular basis every year.
- Apply for a loan or credit based on your limit.
- Maintain a good credit mix.
- All dues and EMIs must be paid on time.
It is important that you have a good CIBIL score when you apply for a loan or credit card. Your application may be rejected or the interest rates will be high in case you apply for a loan with a low credit score. Any rejections will lower your credit score even further. You must pay all the dues on time and have the right credit mix to improve your credit score.
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FAQs on CIBIL/Credit Score Range
- What is a good credit score range?
A credit score ranging between 700 and 799 is considered a good credit score. If your credit score is more than 700, banks will most likely approve a loan.
- What is a bad credit or CIBIL score?
If your credit or CIBIL score is less than 600, it is considered a bad CIBIL score. People having poor CIBIL score will reduce the chances of getting loans as it is highly risky for the lender to approve loan applications.
- What is an outstanding credit score?
If your credit score is at least 800, it is considered a good credit score. If your credit score is 800 or above, the bank will instantly approve your loan application.
- What is an acceptable credit score range?
An acceptable credit score range varies from lender to lender. However, CIBIL score range more than 600 is known to be acceptable.
- What to do if my CIBIL score is in the poor range?
If you have a poor CIBIL score, your loan or credit card application will be rejected. In order to improve your CIBIL score, you need to pay your outstanding dues on time.
- Are credit scores the same across the world?
Yes, credit scores are mostly the same across the world.
CIBIL Score Requirements for Loans
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