CIBIL Score in Detail

CIBIL score in detail
What is CIBIL score?
A CIBIL Score is a consumer's credit score. Simply put, this is a three-digit numeric summary of a consumer's
credit history and a reflection of the person's credit profile. This is based on past credit behaviour, such as
borrowing and repayment habits as shared by banks and lenders with CIBIL on a regular basis
India’s pioneer information and insights company, TransUnion CIBIL maintains one of the largest collections of
consumer credit information globally.
What is a CIBIL Report?
A CIBIL Report is a consolidated credit report that includes the consumer's CIBIL Score and credit summary,
personal information, contact information, employment information, and loan account information. It is
important to note that lenders consider both the CIBIL Score and Report to assess a person's loan eligibility.
CIBIL score range
CIBIL scores can range anywhere between 300 and 900, with 900 denoting maximum creditworthiness. A CIBIL score of 750 or
above in your credit report is ideal and will aid in qualifying you for personal loans and credit cards.
If your CIBIL score is below 750, however, you will find it harder to borrow funds from banks and NBFCs. You may be offered a
loan at a higher interest rate, if your score is close to 750, or your application may be rejected outright if it is much lower. Thus,
keeping your CIBIL score above 750 is essential.
NA is no credit activity in last couple of years and NH if there is no credit history

How is CIBIL score calculated?
1. Credit History
2. Credit Utilization
3. Credit Mix and Duration
4. Other factors
Why CIBIL score drops?
1. Defaults in loan repayment due to:

• Financial Hardship
• Missed payment on credit cards
• Disputes with lender on account of fraud, extra charges etc.
2. High amount of unsecured debt:

• More credit card and personal loan
• Less/no secured loans (home and car loans)
3. Leverage:
• Using credit limit to extreme margins
4. Others:
• More loans in short time
• More credit/loan enquiries in short time
5. Impact of joint/add-on Credit/Guarantor

• Joint loan impacts credit score of all borrowers
• Add-on card impacts the CIBIL score of main card holder
• If borrower defaults then the guarantor’s CS is affected
• If company defaults then the CS of partner/proprietor/director is affected
How to improve CIBIL score?
1. Pay all loans/ Credit cards on time and in full

• Adopt automatic payment modes – Electronic clearing system (ECS), Post dated cheques (PDC)
• In case any dispute with lender clear the amount before due date.
2. Credit mix and duration

• Don’t take too many loans in short time
• Limit your unsecured credit ( credit cards, personal loans)
3. Don’t be credit hungry

• Limit your credit card spending
4. Manage credit cards

• Don’t take too many credit cards
• Pay monthly dues in full
• Keep oldest credit card with good repayment history
5. Monitor your loan accounts

• If you have joint loan account
• If you are guarantor of a loan
6. Report inaccuracies to CIBIL once a year

• Check credit report once a year
• Check for incorrect open accounts
• Report inaccuracies to CIBIL consumer dispute
Data universal numbering system (DUNS)
The DUNS number provides information related to a company such as its official business title, name,
financial data, trade name, payment history, economic status, and executive names. Further, the number
allows a company to search for information about other companies and helps businesses find potential
customers, partners, or vendors.
Tax Deduction and Collection Account Number (TAN)
The primary purpose of the Tax Deduction and Collection Account Number, commonly known as TAN, is
related to deduction or collection of tax at source. Under Section 203A of the Income Tax Act, obtaining TAN
is compulsory for individuals or businesses who are mandated by the government to deduct or collect tax.
Corporate Identification Number (CIN)
CIN number is used to track all the activities of an enterprise after its registration by RoC. This number
contains the identity of an organization and additional information regarding registered company under
RoC. Company’s information can be accessed using 21 digit alpha numeric unique identification number by
RoC.
XXX
Means that the lender has not reported the credit data for the specific month. 000 means your payment is
not overdue and made on time.
Standard (STD): payments made within 90 days.

Sub-standard (SUB): payments being made after 90 days
Doubtful (DBT): The account has remained Sub-Standard for 12 months.
Special mention assets (SMA)
Special Mention Accounts are those assets/accounts that shows symptoms of bad asset quality in the first 90 days itself.
The Special Mention Accounts are usually categorized in terms of duration. For example, in the case of SMA -1, the overdue
period is between 31 to 60 days. On the other hand, an overdue between 61 to 90 days will make an asset SMA -2. In the case
of SMA -NF, non-financial indications about stress of an asset is considered.
SMA Sub Category Classification basis
SMA – NF Non-financial (NF) signals of stress

SMA-0 Principal or interest payment not overdue for more than 30 days but account showing signs of incipient stress,
Delay of 90 days or more in (a) submission of stock statement / other stipulated operating control statements or
(b) credit monitoring or financial statements or (c) non-renewal of facilities based on audited financials.

SMA- 1 Principal or interest payment overdue between 31-60days.

SMA – 2 Principal or interest payment overdue between 61-90 days.

Portfolio at risk (PAR)
In the portfolio at risk analysis, we mainly use PAR to measure how much risk that our loan portfolio has
in percentage compared to our total portfolio. The term risk in this ratio refers to the risk that the loan’s
clients may not pay or not be able to pay back the loans that we provided them.
Formula: PAR (X)= loan portfolio within x days overdue or more

total loan portfolio
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What is a CIBIL score and report?

What is a CIBIL score and report?

What factors affect a person's CIBIL score?

What factors affect a person's CIBIL score?

CIBIL score in detail

What is CIBIL score?

What is a CIBIL Report?

NA is no credit activity in last couple of years and NH if there is no credit history

3. Credit Mix and Duration

1. Defaults in loan repayment due to:

2. High amount of unsecured debt:

5. Impact of joint/add-on Credit/Guarantor

1. Pay all loans/ Credit cards on time and in full

2. Credit mix and duration

3. Don’t be credit hungry

4. Manage credit cards

5. Monitor your loan accounts

6. Report inaccuracies to CIBIL once a year

Tax Deduction and Collection Account Number (TAN)

Standard (STD): payments made within 90 days.

Special mention assets (SMA)

SMA – NF Non-financial (NF) signals of stress

SMA- 1 Principal or interest payment overdue between 31-60days.

SMA – 2 Principal or interest payment overdue between 61-90 days.

Formula: PAR (X)= loan portfolio within x days overdue or more

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