Banks give a lot of importance to the credit history of an individual before approving a loan application. In order to minimise the risk of default, banks prefer lending money to people with a decent credit history. It is thus important to know how loan and Credit Score relate. Banks look into the ‘Credit Score’ of a person to learn whether he or she is a responsible borrower. A Credit Score is a three-digit numerical expression that will predict the credit behaviour of a person. When assessing creditworthiness, one will come across terms like CIBIL report, CIBIL Score, etc. which can be confusing at times. 

Let’s find out the difference between a CIBIL report and a CIBIL Credit Score. 

What is CIBIL’s Credit Score?

The term ‘CIBIL’ is an acronym for Credit Information Bureau (India) Limited. CIBIL is amongst the top four credit bureaus in India which is licensed by the Reserve Bank of India (RBI). While scores from other bureaus are valid, most banks typically prefer to check the CIBIL Score. Hence, knowing the power of your CIBIL Score is important.

How is the CIBIL Report Different from the CIBIL Score?

A CIBIL Report differs from a CIBIL score. The major difference is that the CIBIL score indicates marks, while the CIBIL report is the mark sheet. Your credit report contains a comprehensive explanation of your credit history, the number of credit cards you own, active loans, outstanding/ overdue amounts, etc. All these factors are considered while calculating credit scores A glance at the table below will help you to quickly understand the key differences between credit scores and reports.

Credit ScoreCredit Report
It is a three-digit numerical score indicating the range in which your credit profile falls in. Credit scores are categorized as Excellent, Very Good, Good and Poor, depending on the score.A comprehensive list of details like previous credit cards and loans, outstanding/overdue amounts, credit card expiry/loan expiry dates, credit utilization ratio, etc.
Used by payday lenders and quick loan lenders for soft enquiries to determine an individual’s creditworthiness.Referred to by banks and other financial institutions for hard enquiries to process bank loan applications.
Credit score is part of the credit reportA credit report indicates factors other than the credit score to help banks and financial institutions determine an individual’s reliability before sanctioning loans.

Apart from the data relating to debt, it includes personal details as well. Additionally, every time you apply for a loan, the lender will inform the CIBIL about the same and this information will get recorded in the CIBIL report.  The following table will give you a clear idea on how CIBIL report and CIBIL scores are separate.

What Information is there in the CIBIL Report?

  • Credit Score

CIBIL will calculate your Credit Score by taking into account your credit behaviour, which will be reflected in your CIBIL report’s ‘Accounts’ and ‘Inquiries’ sections. Your CIBIL Score can be any number between 300 and 900. Generally, you should maintain a score above 700 to be considered good. 

  • Personal Information

This section includes your name, Permanent Account Number (PAN), permanent address, contact number, etc. Depending on the information collected from different financial institutions, the report may sometimes contain multiple addresses and contact numbers. 

  • Employment Details

The details about your monthly income will be shown here. This information will be collected from banks or other financial institutions. 

  • Account Details

This section provides all the information relating to the credit facilities you have availed. It includes data such as the name of the lenders, type of credit facilities that have been availed (such as home loan, vehicle loan, personal loan etc.), account numbers, whether it is a single account or jointly held, date of opening, when was the last payment made, loan amounts, current balance and a month on month record of the payments made for up to 3 years. 

  • Inquiry Details

This section will detail the number of times any bank or financial institution has accessed your credit report for verification purposes. 
Knowing about key credit report terminologies is important, along with knowing the difference between a Credit Report and Credit Score. Before applying for a loan in India, you must do a CIBIL Score check, especially if you have used credit cards or taken loans in the past. If your CIBIL Score is below 700, it is recommended that you practice financial discipline to improve your creditworthiness. If you need help improving your CIBIL Score, get in touch with Team Oolka.

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