Credit bureaus are essentially an information warehouse that collects critical information about you and sells it to lenders in India and others who are interested in learning more about your borrowing habits. Whatever information they supply is necessary for lenders to determine the loan borrower’s creditworthiness and eligibility for a loan. This implies that before granting you a loan, lenders want to know if you have the ability to repay the loan on time. The information provided by the credit bureaus is used to calculate your credit score, which is utilised by lenders to determine whether or not to approve your loan.
India’s credit rating agencies
A credit rating agency is a company that assesses a person’s creditworthiness before granting them a loan or approving them for a credit card.
CIBIL
In India, it is one of the most widely used credit bureaus. It is linked to a significant number of non-bank financial companies (NBFCs) as well as banks. To assist individuals in applying for loans, CIBIL provides a thorough and detailed report. Individuals are given a three-digit credit score ranging from 300 to 900, with 900 being the best and 300 being the worst. The higher your credit score, the more likely you are to get approved for loans or credit cards.
CRISIL
Another credit bureau available in India is CRISIL. It is a multinational analytical firm that offers services such as ratings, research, risk management, and policy advice. The global firm was founded in 1987 and was India’s first credit rating agency.
Equifax
Equifax was granted permission by the government to begin full operations in 2010. Individuals are ranked from 1 to 999, with 1 being the lowest and 999 being the highest. Presently, the company is offering a variety of services to individuals such as risk scoring, portfolio reviews, credit information reports, etc.
ICRA
ICRA Limited is one of India’s most well-known credit rating agencies. It is a partnership between Moody’s investors and a number of other financial services organisations. It is primarily responsible for ranking mutual funds and rating the performance of real estate firms and hospitals.
Highest CRIF Score
It is India’s only all-round credit rating company, catering to the needs of all types of borrowers, including retail, small business, and MSME loans, among others. CRIF High Mark is in charge of providing credit rating and analytical services.
All credit bureaus are crucial since they assist lenders in determining your creditworthiness before granting you a loan. They provide a credit score that helps lenders understand your credit profile and credit history.
Summary
The credit bureaus play a vital role in assisting lenders in determining your eligibility. Credit bureaus assist lenders in understanding your credit history and determining if you are eligible for a loan or best credit cards in India and have the means to repay it. They calculate your credit score, which is a three-digit figure that assists you in obtaining a loan to satisfy your financial needs, based on your previous credit history. If you have a low credit score, you can contact any of these credit agencies, who can advise you on how to raise your credit score in a timely manner. A credit bureau can aid loan borrowers in determining their credit standing. To aid lenders in providing you a loan, a credit bureau collects, retains, utilises, and discloses personal and credit-related information about individuals and businesses to credit bureaus.
