The first step towards availing any form of credit starts with CIBIL score. Today almost all banks and NBFCs consider this score to be the benchmark of an individual’s credit worthiness. What is so special about this CIBIL score? Read the below article to find out.


What is CIBIL score?

A CIBIL Score is an important number in India, especially if you plan to apply for a loan or a credit card. It is a three-digit number that represents your financial past and implies your credit worthiness. The CIBIL Score starts from 300 to 900, and if your score is closer to a score of 900, it is considered good . On the other hand, if your score is closer to 300 then it is normally considered bad . Therefore CIBIL Score check is done because once your score drops below 600 then you go into the "risky" zone and banks can deny lending to you.

Full form of CIBIL

CIBIL full form is Credit Information Bureau (India) Ltd. It is the most popular of the four credit information bureaus active in India and so the Reserve bank of India has licensed Transunion CIBIL, the parent company to generate credit reports of the borrowers from any Indian banks.

What is CIBIL 2.0?

CIBIL 2.0 is a boon for new to credit users. In case you are wondering why we are saying so, let's get on with the specifics below.


  • Individual has no loans/credit facilities & is not reported on the bureau.
  • Individual has no loans/credit facilities & has only been enquired upon.
  • Individual has loans/credit facilities on bureau, but all have been closed 24 months prior to enquiry.
  • Individual has loans/credit facilities but none have been reported in the last 24 months.
  • Individual has no loans/credit facilities with performance history greater than 6 months, hence a risk index is returned. 
  • Higher the index, lower the risk.
  • Greater than 6 months of performance history (last 24 months)
  • Higher the score, lower the risk.

What’s new in the CIBIL 2.0?

Earlier users who had negligible or no credit activity in the last 24 months were rated as NA or NH signifying the lack of enough credit activity. To simplify things Transunion CIBIL has come up with CIBIL 2.0. Now, customers who have less than 6 months of credit history will be rated on a scale of 1-5 with 1 signifying “high risk” and 5 signifying “low risk”.      
If you are in the habit of seeing a higher CIBIL score, there’s an update –

  • The credit score in CIBIL 2.0 will be lower than your CIBIL score
  • You will also get the Risk Index in your updated report. The RI ranges from 1 to 5 with means the following things –
Risk IndexWhat it means
1-2High risk
3Moderate risk
4-5Low risk

Difference between CIBIL score and Credit score

CIBIL score is a Credit Score generated by a credit rating agency called TransUnion which is licensed by RBI to generate credit reports of users who wish to take any form of credit. While there are several Credit Bureaus that issue credit scores, CIBIL is the one that holds most weight with banks. So you see, 
Every CIBIL score is a credit score but every credit score is not CIBIL score.

Steps to Check CIBIL Score Online

You can check CIBIL score online directly on the official site of Transunion CIBIL. There you can also check your CIBIL score using PAN card

How to check CIBIL score by PAN card?

Today almost all credit activities are done by looping in your PAN card and so checking CIBIL score online using PAN is something which is a reasonable service that benefits the borrowers both old and new to credit.

Step 1 - Log in at the CIBIL portal 
Step 2 - Click on the button at the top right corner of the screen that says “Get your CIBIL Report” 
Step 3 - Choose any of the subscription plans 
Step 4 - Provide basic details like DOB, mobile number and email address 
Step 5 - Create a password  
Step 6 - Select “Income Tax ID(PAN)” as your ID type and enter your PAN number 
Step 7 - Proceed to “Verify your identity” and answer all questions accurately 
Step 8 - Complete the process by making the payment depending on the subscription 
Step 9 - Login to your account by verifying with OTP  
Step 10 - Enter relevant details in the form 
Step 11 - Get your online CIBIL score along with your Credit Report

How can I check my CIBIL score for FREE?

As a show of good faith and practice, Transunion CIBIL allows users to do one free CIBIL score check using PAN card online. In order to avail that service, you can directly login your account after verifying your identity and then follow step 10 and 11 from above to get your free credit report and get your free CIBIL score.

What is a CIBIL Report?

A CIBIL report is a single consolidated document that contains an in-depth overview of your credit history across different lenders over a significant time period. The credit report includes the following information

  • Personal details of an applicant (name, age, gender and address)
  • Employment details and earnings
  • Number of hard enquiries made by potential lenders on receipt of the loan/credit card application
  • Records of previous and current loans along with the payment record
  • Any defaults on loan mentioning the months you defaulted
  • The details of settled loans
  • Total credit limit and the amount spent monthly (Credit Utilization Ratio)
  • Any credit card payment defaults
  • Credit score which in this case is your CIBIL Score

The credit report  gives lenders detailed information on the applicant’s creditworthiness based on previous and current credit behavior. Based on this, lenders take the lending decision whether to approve the credit request. 

Also, your CIBIL report gives you an opportunity to analyze your credit habits and take corrective action if needed. Being aware is the first step to good financial health. As the number of loans and cards pile up, even the most disciplined credit users can lose sight of their credit reality and end up in a debt trap.

How is CIBIL Report Generated?

Credit Information Bureau of India Limited (CIBIL), India’s first Credit Information Company, collects and maintains the records of an individual’s and non-individuals (commercial entities) credit-related transactions such as loans and credit cards. These records are provided by banks and other lenders every month to the Credit Bureau. Using this information, a Credit Information Report (CIR) and Credit Score are developed.

So essentially there are 2 types of CIBIL report

  • For individuals who are looking to get loans, cards etc. This is called Individual Credit Report
  • Commercial entities who are looking to apply for credit from banks. This is known as Commercial CIBIL Report

How is CIBIL Score Calculated?

The member banks and financial institutions report monthly the details related to the credit activity of the customers to the credit bureaus. This includes data of each loan or credit card repayment made by the customer during the period and even the late or skipped payments. The report comprises new loan applications, interest rates, the credit limit on cards, the status of all loan accounts including those ‘written-off' or ‘settled’ or ‘closed’. After a complex statistical analysis of the provided information, the CIBIL score is calculated. Timely credit payments generally lead to a good score. Individuals with a high score have better chances of getting a loan or a credit card.

Factors affecting CIBIL Score

CIBIL score is a rating system that indicates an individual’s credit history. CIBIL is India's oldest and most reputed credit bureau that assigns credit scores to individuals handling credit. The cibil score ranges from 300 to 900. The higher the credit score, the bigger the loan amount an individual may avail, and the lower the applicable interest rate. CIBIL score calculation depends on several factors that work together to affect the CIBIL score. These include the following: - 

Repayment History

It is important to make timely payment for your EMIs and credit card bills. Delaying or defaulting on any credit payments can lead your credit score to plummet. It accounts for around 35% of your Credit score or CIBIL score.

Credit Utilization Ratio

You will need to monitor your credit utilization ratio and ensure that it remains 30% or less. You may have to limit your spending to maintain a 30% credit utilization ratio.

what makes your credit history

Credit History

The duration for which you have been a credit enabled individual also matters. This accounts for around 15% of your credit report. This is why it is advisable to never cancel your oldest credit card because that is the oldest reminder of your credit worthiness.

Credit Mix

Credit mix, or the diversity of your credit accounts, is one of the most common variables used to calculate credit scores. It accounts for 10% of your credit score. Having a right mix of secured and unsecured loans show lenders that you can manage multiple types of debt at the same time. It also helps them gain a better understanding of your financial situation and willingness to repay debt.

New or Multiple Inquiries

If you have recently applied for any credit too many times then it is considered a big red flag by the lenders. Why? Your repeated application for new loans or credit cards can be seen as a credit hungry behavior and so it gives negative points to your credit score. Normally this is done by financial institutions who do an online CIBIL check of your financial credit profile before approaching you with offers. This accounts for 10% of your CIBIL score and it is also known as Hard Inquiry on your credit report.

Why is my CIBIL score important for getting a loan?

The CIBIL Score plays a critical role in the loan application process. After an applicant fills out the application form and hands it over to the lender, the lender first checks the CIBIL Score and CIBIL Report of the applicant. If the CIBIL Score is low, the lender may not even consider the application further and reject it at that point. If the CIBIL credit score is high, the lender will look into the application and consider other details to determine if the applicant is credit-worthy. The CIBIL Score works as a first impression for the lender, the higher the score, the better are your chances of the loan being reviewed and approved. The decision to lend is solely dependent on the lender and CIBIL does not in any manner decide if the loan/credit card should be sanctioned or not.

What is the CIBIL Score required for Personal Loan?

A CIBIL score of 750 or above is considered good for any kind of unsecured  loan like personal loan and short term loans also known as STPL.

Below is the data provided by Transunion CIBIL on its official website to denote the percentage of credit offered against borrowers with CIBIL scores. You can very well see the majority of sanctioned loans in the score range of 750+. A whooping 81.4% of sanctioned loans have a CIBIL score of 750 and above.

Read more: CIBIL Score for Personal Loan

What is the CIBIL score required for Home Loan?

Home loan is a secured loan where the lender has the security in the form of the property for which the loan is being taken. In this case also having a CIBIL score of 750 and above is considered good. This confirms your reliability to pay off the loan in lieu with all your financial engagements. 

Role of good CIBIL score in getting your home loan at better interest rate

The power of good CIBIL score are plenty but in case of home loans, read below

  • If you are applying for a home loan, it is most important that you have a good credit score. If upon doing CIBIL check online you find out having a low credit score, the chances of rejection of your home loan becomes much higher. Every lender would want to give credit to a person with a high credit score as the chances of repayment are higher. 
  • You can also have the power of negotiation when selecting banks for your home loan when your CIBIL score is healthy. How? Lets see a quick example - Mr Chetan wants a home loan of Rs 30 lacs and upon doing his CIBIL score check online he found that it is 780. He is approached by Bank A with a loan offer at 7.8% rate of interest and Bank B with an offer of 7.7%. Here the bargaining power lies with Chetan and he can ask Bank A to give him the same rate as Bank B.

Read more: CIBIL Score for Home Loan

What is the CIBIL score required for a Credit Card?

The minimum CIBIL score required for credit cards is 750 as most of the banks also reject credit card applications of individuals who do not have a credit history or score below 750. But, the fact remains that those who have a score of 750 or above are eligible for a lot more than those who are not in this category.

What benefits do you get on a credit card with a good CIBIL Score?

A good credit score is a double edged sword that grants you not only your desired financial remedy but it opens a ton of offers, cashbacks and similar benefits nonetheless. 
Below are the direct and crisp benefits that you can enjoy when your CIBIL score check online gives you a 750+ score

  • Eligible for top credit cards in popular segments like shopping, travel, cashback and fuel
  • Suitable for a higher credit limit 
  • Easy credit card approval process
  • More negotiating power on credit card interest rate
  • Eligible to convert heavy transactions into small installments 

What are the benefits of having a good CIBIL score?

In a nutshell, we can say following are the benefits of you having a good CIBIL score

  • Reduced interest rate on home, auto and personal loans
  • Higher credit eligibility in case of Personal Loans
  • Higher credit limit in case of credit cards
  • You can get better deals on new cards and loan top-ups
  • More negotiating power with lenders 

How can I improve my CIBIL Score?

If this question is popping through your mind then keep reading for the complete answer. You can improve your CIBIL Score by maintaining a good credit history, which is essential for loan approvals by lenders. 

Follow these 6 steps which will help you better your score: 

Always pay your dues on time

Late payments are viewed negatively by lenders


Keep your balances low

Always be prudent to not use too much credit, control your utilization.

Maintain a healthy mix of credit

It is better to have a healthy mix of secured (such as home loan, auto loan) and unsecured loans (such as personal loan, credit cards). Too many unsecured loans may be viewed negatively.

Apply for new credit in moderation

You don’t want to reflect that you are continuously seeking excessive credit; apply for new credit cautiously.

Monitor your co-signed, guaranteed and joint accounts monthly

In co-signed, guaranteed or jointly held accounts, you are held equally liable for missed payments. Your joint holder’s (or the guaranteed individual) negligence could affect your ability to access credit when you need it.

Review your credit history frequently throughout the year

Monitor your CIBIL Score and Report regularly to avoid unpleasant surprises in the form of a rejected loan application. 

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What is a good CIBIL score?


A score of 750 or above is considered as a good CIBIL score.

Who issues CIBIL?


Since June 2002, compilation and dissemination of credit information covering data on defaults to the financial system have been taken over by Credit Information Bureau of India Ltd. (CIBIL) from RBI. This is issued by Transunion, an Indian company which was formed after direction from the RBI Siddiqui committee

Does CIBIL score affect visas?


Some countries might require your CIBIL score before granting you a Visa.

How much loan can I get if my salary is 25000?


According to experts, you can get upto 60 times of your salary as home loan if only your credit score falls in line with their loan sanctioning criteria.

How can I get a 900 CIBIL score?


Although it is tough to get a score of 900 but with disciplined approach and cautiousness, you can try to get closer to this CIBIL score.

What are CIBIL report fees?


For first time users it is free. However, there are various subscription models which you can purchase from the official CIBIL website. If you wish to check your Credit Information Report after utilizing the free option then you will have to pay Rs 550 for every single rep[ort generation.

Does FD increase CIBIL score?


No, simply having an FD won’t affect your CIBIL score. But getting a secured credit card against that FD and maintaining a disciplined bill repayment record can definitely increase your CIBIL score.

How can I raise my credit score in 30 days?


It is tough to do it in 30 days as lending institutions submit your credit activities every 30-45 days to the credit bureau. Still if you want to improve your CIBIL in short time then paying loan EMIs, credit card bills and maintaining a decent credit mix is something you should practice in a disciplined manner.

Why do lenders check CIBIL score before approving a loan?


Because nobody will lend you money without verifying your capability to repay that amount back. In this case your CIBIL score acts as a necessary benchmark for lenders to trust your creditworthiness.

Why is my CIBIL Score zero or negative?


Having a CIBIL score of 0 simply means that the credit bureau has insufficient data from your credit history and they are unable to assign you a fair credit score. This usually happens when your credit account's history is less than 6 months or you have not done any credit activity in last 2 yrs. 
A credit score of -1 means that there is no credit history of any kind

CIBIL ScoreWhat it means
0History not available (NA)
-1No History (NH)