Credit Score: What is a Credit Score? Get all details about Credit Score.
Credit Score: Wondering what a credit score? Don't fret, we've got your back. A credit score is a number that represents your creditworthiness. This article provides detailed information about credit score, how to check your credit score, how to improve your credit score, and what is the impact of different range of credit scores. Read on to know it all!
by Monika
Updated: May 18, 2020 10:10 IST
What is a Credit Score?
A credit score is a 3 digit number that represents the creditworthiness of an individual. This number ranges from 300 to 900. Higher the credit score, higher the creditworthiness of an individual. There are 4 credit bureaus or Credit Information Companies (CIC) namely TransUnion, CIBIL, Experian Equifax, and CRIF High Mark based on the credit information held by these companies about individuals.
What is the impact of different range of credit scores?
These scores fall into one of the following grades and impact an individual’s chance of getting a loan approved as well as the interest rate paid on these loans. An individual with a higher score has a higher chance of getting a loan approved, also pays lower interest rates on these loans.
| Grade | Credit Score Range | Impact |
| Excellent | > 750 | Quick loan approval and low-interest rates |
| Good | 700 – 749 | Good chance of loan approvals |
| Fair | 650 – 699 | Low chance of loan approval and high interest on loans |
| Poor | 500 – 649 | No chance of loan approval - need to improve the score |
| Bad | < 550 | No chance of loan approval - takes years of effort to improve the score |
How can Credit Score be improved?
Paying bills in time – includes credit card and utility bills
Using only 30 – 40% of credit limit on credit cards
Not applying for too many credit cards
Not defaulting on loan obligations, paying them in time, every time!
Not applying for too many loans
How can one know their own credit score?
Individuals can obtain their credit scores for free from the CICs for up to 2 times a year. One can look at their scores from these websites, note: one needs to open an account with the CIC, provide personal information and pass verification test.
For Free CIBIL Credit Score: https://www.cibil.com/freecibilscore
For Free Experian Credit Score: https://consumer.experian.in/ECV-OLN/signIn
For Free TransUnion Credit Score: https://membership.tui.transunion.com/tucm/orderStep1_form.page?offer=3BM10246&PLACE_CTA=top_right_search
For Free CRIF Credit Score: https://cir.crifhighmark.com/Inquiry/B2C/B2CFFCRPortal.action
Credit Score - FAQ
Yes, it is extremely important to maintain a good credit score to avail of loan from any financial institution. The institution will provide your loan based on your credit score.
