A credit score is a numerical summary that lenders check to ascertain your creditworthiness before approving any loan. This 3-digit number ranges between 300 and 900 and helps financial institutions evaluate your repayment capacity.
Maintaining a good credit score of 750 or above is important to avail loans on favourable terms. The RBI has authorised four credit bureaus in India to generate your credit score, of which TransUnion CIBIL is the most popular.
Read on to understand the process of checking your credit score online and the significance of a good credit score.
How to Check Your Credit Score Online
There are various methods to check credit score online. Here are some ways you need to be aware of.
Through the CIBIL Website
You can check your credit score by visiting the official portal of CIBIL and requesting a free CIBIL score. All you have to do is follow the process mentioned here.
- Visit the CIBIL website at https://www.cibil.com/freecibilscore
- Click on the ‘GET YOUR FREE CIBIL SCORE’ tab
- Register on the website by providing details, such as your email address, mobile number, etc.
- Choose a specific ID type: your PAN, Voter ID, Driver’s license number, etc.
- Click on the ‘ACCEPT & CONTINUE’ to proceed further
That’s all, and you can get your free credit report and your score in just a few minutes. However, remember you can check your score for free only once a year. If you wish to check your credit score online regularly, you may have to pay a specific amount.
You can gain easy access to your credit score effortlessly without causing any impact on your credit score. When you check your report via these services, it is considered a soft inquiry.
A soft inquiry does not harm your score. On the contrary, a hard inquiry is one that is initiated by lenders, and this can lower your credit score. Naturally, multiple such inquiries will lower your score by a lot, so keep your credit applications minimal.
That said, keeping a tab on your score and checking it thoroughly before applying for any loan is best.
Through the Website of Your Bank
Another method to check your credit score online is by accessing the website of a bank that you have an account in. Most financial institutions allow their customers to get free credit reports online through their websites annually.
You may check your bank’s website or speak with the concerned representative to understand if they offer the service to check your CIBIL score for free. For instance, ICICI Bank allows you to check your credit score, albeit at a cost, via the iMobile Pay app.
Such checks will not lower your score, but if you were to apply for a loan with the bank, your score would dip temporarily.
Through Third-party Apps or Websites
There are many NBFCs offering the facility of free credit score checks through their mobile applications and websites. Make sure to register before you proceed to check your credit score.
You may also use paid versions if you need to get regular updates on your CIBIL score or monitor your credit profile frequently. Using these apps, you can get your score along with a detailed analysis. Some apps even offer you tips on how to boost your score.
All you have to do is simply fill in essential details, such as your name, employment type, PAN, etc., to calculate your score instantly. Furthermore, some apps provide access to curated loan offers that match well with your score.
Why is a Good Credit Score Important?
Maintaining a healthy credit score can increase your eligibility for loan approvals. While a score of 750 or above is considered a good credit score by most lenders, you can also get easy loan approvals.
However, if your score is 650 or less than that, you may find it hard to get loans. Lenders consider such borrowers as high-risk individuals as there is a higher chance of defaulting on loan repayments.
So, it is crucial to maintain an optimal credit score to get loans on favourable terms. Here are some other benefits of maintaining a healthy credit score:
- You get to enjoy higher loan amounts
- You can avail loans at affordable interest rates
- Your loan application is approved quickly
- You can get better repayment terms
- You have many options to choose from
While you are familiar with the significance of a good credit score, know that there are 4 critical factors used to calculate your credit score. These include:
- Your credit type and its overall duration
- Your payment history
- Your credit utilisation ratio
- Your credit enquiries
Hence, keeping a mix of secured and unsecured forms of credit is ideal for boosting your score. Apart from that, timely payment of your loan EMIs or credit card bills and utilising less than 30% of your total sanctioned credit limit are some ways to maintain a healthy score.
That said, building a good score is a slow process and requires patience and financial discipline. Being responsible and utilising credit wisely is key to building a healthy credit score.
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