Putting your CIBIL score to use - How?

Opt for a better credit card
If you have been considering offer from a particular card issuer because it gives you significant fuel consumption benefits, frequent flier benefits or even just hefty rewards on shopping, you would most probably take up that card now. However, do ensure that your research and groundwork is thorough and the benefits that your new credit card issuer has assured you of is not a smokescreen. Also bear in mind that when you apply for a new credit card, or any new credit for that matter, your Cibil score comes down temporarily. This is because a "hard inquiry" is made by the lender on your Cibil score and report to review your creditworthiness as a part of their loan approval process. However, if you keep a hawk's eye on your credit card spendings and pay all your outstanding bills on time, you have little to worry about!

Get a balance transfer on your new credit card
If you think that your new credit card is really good and is offering you a better rate of interest as compared to some of your other existing cards, you may even consider a balance transfer on to this new card. A balance transfer may be really lucrative as your interest outgo may come to a naught for the first few months. If maintaining multiple credit channels open is bothersome for you and you are also fearful of the fact that your spending may go out of control, a balance transfer can be your ideal solution.

But do remember that a balance transfer is neither free of cost nor is it a standardised product. Each lender has a different transfer fee and a nominal processing fee that you will need to cough up. The other thing to remember is that even as you carry out a balance transfer, do not close your existing cards. Closing your cards brings down your overall utilisation of credit. This, too, has a detrimental impact on your Cibil score.

Shop for a home loan
If you do not have a house of your own, , you can use your good Cibil score as a trigger to go shopping for home loans. As you might be aware that the economy is on an upswing and the inflation is under control. There have been a series of rate cuts this year and there promises to be more such rate cuts going ahead. In financial parlance, we are in what is called a "low interest rate regime". So if you have been deferring your decision to purchase property, now is the time to take action on it.

What's more? Buying your own house will give a further boost to your Cibil score and will also take it up a few notches. A home loan approval is a stamp of your lender's confidence of you repayment capability over a long term. Do not worry if your Cibil score comes down a bit initially as a hard enquiry is carried out by the lender before approving your loan. As you start repaying your loan on schedule, your Cibil score will go up eventually, taking up your score much above 750.

While these are a few things you can do to get a good Cibil score, do bear in mind always that credit is always a slippery slope. So, keep an eye on your credit card spend, credit utilization and timely repayments. This will ensure that your Cibil score remains intact over a prolonged period of time and you have access to credit whenever you require it. more  

View all 10 comments Below 10 comments
Thanks, Mr.Ganeshan for appreciating my views.
Can CIBIL be prosecuted for spreading false news / marks ?
Can we claim damages from this dishonest site ?



*Mr. MADHUKAR C. SHETH , * more  
CIBIL is nothing but a banker's platform to do data entry as provided to it. Does not bother to verify if the data provided is authentic or not because the bank has provided it.

It is like ICICI PRUDENTIAL INSURANCE which is a group company of ICICI where the dominant player is the ICICI BANK. Also, the MD & CEO of ICICI BANK is the Chairperson of ICICI PRUDENTIAL. Another fact is that the MD of ICICI PRUDENTIAL is an ex-Director of ICICI BANK.

In a matter of credit assure policy for inability to repay loan, ICICI PRUDENTIAL dilly dallied an alleged proposal in my wife's name as a loan co-applicant blindly just because its dominant partner ICICI BANK had given it the premium amount and the alleged application form for loan co-applicant.

ICICI PRUDENTIAL did not bother to reject the alleged application form as it does not have any policy to cover risk of inability to repay loan and it knows very well that its other group company ICICI LOMBARD GENERAL INSURANCE has that particular and specific policy. This is because ICICI BANK has asked it to mock a process as ICICI BANK wanted to cheat the customer.

Secondly, ICICI PRUDENTIAL did not bother to verify from the borrower about the alleged loan co-applicant even when the loan application with ICICI BANK itself clearly shows that there is no loan co-applicant. This act by ICICI PRUDENTIAL was aimed at assisting ICICI BANK to cheat the customer.

Thirdly, ICICI PRUDENTIAL did not reject the alleged application form despite several obliteration of vital data of loan amount, sum assured, beneficiary etc just because it was following the directions of its dominant partner in crime - the ICICI BANK because the customer is to be denied of insurance benefits covenanted. If any ordinary person had given such a form, this ICICI PRUDENTIAL or any other insurance company would have rejected the same on the very first day.

So just like these group companies oblige their dominant partners which are banks, this CIBIL also blindly validates the data provided by the banks irrespective of the authenticity of the data.

There should be a platform like CIBIL where the frauds of the Banks can be recorded with documentary evidence so that the prospective facility seeker gets the same benefit of vetting the bank's bonafides before applying for a facility. more  
I concur with most of the views. There has to be refinement in the system. While CIBIL has no onus on the data provided by the banks they should consider such cases where the facts/data are misrepresented/mistaken. CIBIL should take up the matter with the respective banks/credit institutions in such cases where there is obliteration. Finally the score provider is CIBIL. ONLY CIBIL can correct the data in their servers after thorough enquiry with the Bank/credit institutions. more  
CIBIL platform sud b banned. It honors Banks' complaints but does not take into account customers' response. CIBIL presumes that all Banks or lenders are honest and all card holders are dishonest. Facts are 50/50. Bank managers, in order to get promotion, hires 100 boys to sell cards to people who dont need it, at Malls, at Petrol Pumps, at Stations. They tell you half truth only to sell the cards.
I was persuaded to accept SBI card (no fees). I never used this card but SBI debited me 4000 Rs. to be refunded later !! Why sud I pay this ?? I wrote to CIBIL, it said we have forwarded yr complaint to SBI, wait till SBI replies !! SBI will never reply but my score is down by 250
CIBIL gets more money from Banks and not from card holders. So they side with banks only. more  
CIBIL is an unreliable platform in as much as reflecting credit worthiness of a person - whether with existing record of servicing loan products or not having any loan product history.

My wife had a CIBIL score of over 780 in 2008. Towards end of 2008, we shifted from the tenanted residence

Several banks approached with offers of loans as the loan repayment record was excellent and the CIBIL SCORE in 2008 was over 780 wherein we did not miss any ECS nor was there even one day's delay in making EMI payments and we needed education loan for our son.

We applied for loan after shifting the residence. Strangely some of the banks stated that although we had given bank statements showing repayment record the CIBIL score was "ZERO'" with no loan record.

One of the banks said that there is default in payment reported by the ICICI BANK??? where there was no such default of any nature and the bank statements are enough evidence for establishing the same.

Through a helpful person in a bank, I tried to understand why such contradictory feedback is being given. The result was shocking:

1. The CIBIL score with the previous address showed all the loan repayment record and a score of over 780. It also showed delay of credit card payments reported by ICICI BANK. When we contacted ICICI BANK, they maintained that we are not defaulters of any nature and all our payments are spot on the the due date????

2. The CIBIL score with the new address (all other details being the same) showed no loan record and "ZERO" CIBIL score.

CIBIL maintains that it acts as per data provided by the bank as CIBIL does not go about to collate financial information on its own. If bank has not reported or has wrongly reported in any particular case, CIBIL declines to take any responsibility.

With so much fraud taking place in the present day scenario, CIBIL should vet, investigate the data provided by the banks before applying any score to any person. If it does not do so, then it should be penalized as BANKS blindly rely on CIBIL score and have appetite to look into realities. more  
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