How to check your Credit Score?

3 MinsDecember 11, 2019

If you have any kind of credit line, that is, credit card/personal loan/two-wheeler loan/car loan/home loan, etc, you will have a Credit Score with one or more of the four Credit Bureaus operating in India.

A credit score tells lenders about the creditworthiness of the borrower. In other words, a credit score indicates if a borrower is likely to repay his/her loan on time or default on the payment. It tells the bank if the borrower is high risk or low risk.

credit score

What is a credit score?

A credit score is a score based on various parameters such as your age, postal address, the number of loans and the outstanding loan amount, repayment history-how regular you are in servicing your existing loans, etc. These are the broad factors that determine your credit score. There could be others too depending on the data available with the credit bureau.

The credit bureau gives a score between 300 and 900 based on these factors, with 300 being low and 900 being high. A high score means the chances of the loan application being approved are higher. In some cases, the bank could also offer a lower interest rate if your score is high.

The four Credit Bureaus operating in India are TransUnion CIBIL, Experian, Equifax, and CRIF Highmark. Banks share data about their customers with the bureaus and based on that data the bureaus give the score. While the data for an individual is the same, the score may vary across bureaus based on how much weightage the bureau gives to the parameters.

[Also Read: Choose your Credit Card]

Checking your check credit score

As per the Reserve Bank of India regulations, an individual is entitled to a free credit score and report in a year. If you want to access your credit report more than once, you will be charged a fee.

Here is how you can check your credit score:

(1) Visit the website of a credit bureau and look for the link for a free credit report.
(2) Create an account with the credit bureau by providing your email id, name, date of birth, gender.
(3) Also, provide details for verifying identification and address such as PAN/Aadhaar/passport number/license number.
(4) After you accept the terms and conditions you will get the credit score and the report will be sent to you by email.
(5) In some cases, you may have to select a personal/business report. Individual borrowers have to select a personal report.

Why should you check your Credit Score?

It is good practice to check your credit score if you are looking to avail any loan. You will know the chances of your loan application getting approved. If you have a high score your loan could be processed faster. Or you could even request the bank for lower interest rates.

If the credit report shows an error, such as a loan that you have not availed of, or a loan that you have settled or paid off but is still showing as unpaid, you could ask the bank to rectify it. But remember checking your credit score too frequently is not considered good credit behaviour. Your credit score could see a negative impact on this account.

Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision