The oldest credit rating agency of the country, Credit Information Bureau of India (CIBIL) has been known for providing credit reports of borrowers to banks. The reports help banks in indentifying the credit worthiness of the prospective borrower and thus aid in deciding whether to offer him a loan at all and if yes then the amount to be offered, repayment period and interest rate to be charged.
CIBIL has recently announced that it would be offering credit scores to customers too. The idea of offering credit scores to customers is to help them in judging as to where are they actually falling short of in being eligible to get a loan.
The score has been developed in partnership with TransUnion and named as CIBIL TransUnion Credit Score. It would be offered to the customer at a price of Rs 450.
The credit score and its features
The CIBIL TransUnion Credit Score calculation is done on the basis of rating given to customers in the range of 300 to 900.
Score is given to the customer based on various factors like:
2.Delinquencies in loan repayment
3.Type of loan offered: secured/unsecured
4.Queries for loans
5.Loan request rejections
6.Frequency of setting up loan account
The benchmark would however be different for each bank in considering a score to be decent or not. E.g. For one bank a credit score of 700 may be a decent one for sanctioning a loan while it may not be for some other bank which has kept a higher benchmark for the same.