From Bad to Good: How to Transform Your CIBIL Score and Achieve Financial Success

CIBIL score plays a crucial role in managing our financial affairs. In India, the CIBIL score is often used to measure the creditworthiness of an individual or business. The CIBIL score, also known as Credit Information Bureau (India) Limited (CIBIL) score, is basically a three-digit number ranging from 300 to 900. It measures your creditworthiness based on your credit history and repayment behavior. The higher your score, the better your chances of getting approved for loans and credit cards.

How to Check CIBIL Score

To understand how to check CIBIL score, follow the steps below:

• Visit the Bajaj Finserv official website bajajfinserv.in/check-free-cibil-score.    
• Search for the “Check Your CIBIL Score” section to understand how to check your CIBIL score.
• Click on the “Check Score” link.
• Enter your mobile number to receive a One Time Password (OTP).
• Enter the OTP and click the “Submit” button.
• Fill out the form with your name, date of birth, PAN card number, and other required details to understand how to check CIBIL score.
• Accept the terms and conditions.
• Click “Submit” again to complete the process.
• After submitting, your CIBIL score and report will be displayed on the screen. 

Important Factors Affecting Your CIBIL Score

• Repayment History: Your repayment history has the most significant impact on your CIBIL score. Late payments, defaults, or settlements can negatively affect your score. Maintaining a record of timely payments can help you keep a high CIBIL score.
• Credit Utilization Ratio: This is the current total credit card balance ratio to your total credit limit. A high credit utilization ratio can indicate higher repayment risk and negatively impact your CIBIL score. 
• Length of Credit History: The length of your credit history, which accounts for how long you’ve been borrowing, can impact your score. A longer credit history generally improves your score as it gives more data about your borrowing behavior.
• Defaulting on loans: If you have defaulted on any of your loans or credit card payments, this will severely impact your CIBIL score. Ensuring all loans and credit card payments are made on time is important.
• Settling with your bank: If you have settled any previous loans or credit cards with your bank, this could negatively impact your score. A ‘settled’ status implies that the bank had to take a loss on your account, which could make future lenders cautious about lending.

How to Increase CIBIL Score

Listed below are the important steps to know how to increase your CIBIL score:

• Make Payments on Time: Your payment history makes up a significant portion of your CIBIL score. Timely payments of your EMIs and credit card bills demonstrate your responsibility towards your financial obligations. This, in turn, can help you to know how to increase CIBIL score.
• Keep a Balanced Credit Mix: A balanced mix of secured (like home loans, car loans) and unsecured loans (like credit cards, personal loans) can improve your CIBIL score. It shows lenders that you can handle different types of credit responsibly.

• Limit Hard Enquiries: Whenever you apply for a loan or credit card, the lender will conduct a ‘hard inquiry’ to check your CIBIL score. Multiple hard inquiries can negatively impact your score. Limit your loan applications and only apply when necessary to maintain and increase your CIBIL score.
• Maintain a Healthy Credit Utilization Ratio: The credit utilization ratio refers to the percentage of your available credit limit that you’re currently using. A lower ratio is always better for your CIBIL score. To increase your CIBIL score, keep your credit utilization ratio below 30%.
• Regularly Check Your CIBIL Score: Knowing how to check your CIBIL score regularly is as important as understanding how to increase your CIBIL score. Regular checking of your CIBIL score on reliable online services such as Bajaj Finserv Credit Pass can help you track any positive or negative changes in your CIBIL score. It also allows you to identify and rectify any errors in your credit report. If you spot inaccuracies, you can report them to CIBIL and get them corrected. This practice is an integral part of maintaining and improving your CIBIL score.

Conclusion

In the journey from a bad to a good CIBIL score, understanding how to check the CIBIL score and how to increase the CIBIL score is key. By regularly checking your CIBIL score on Bajaj Finserv Credit Pass and taking steps to improve it, you’ll be well on your way to achieving financial success. A good CIBIL score can open the door to better interest rates, higher credit limits, and more favorable loan terms. By understanding how to check your CIBIL score and with a good CIBIL score, you can confidently negotiate for better credit terms. Whether you’re applying for a loan, a credit card, or a mortgage, a high CIBIL score makes the process much smoother.