ATM :: Know the difference between CIBIL credit score and report

Jun 19, 2013, 06.33 PM IST| Rajiv Raj |


Having a spotless credit profile is a must these days. The tendency to take a loan or leverage oneself is high given the wide range of options available in the markets. Off late, I encountered a unique situation in which my friend N Rajesh, a Warangal-based businessman asked me: how does the bank come to know whether I am repaying on time by a mere look at my credit score?

This question triggered a thought in me as to a possibility of confusion among borrowers regarding the difference between CIBIL score and CIBIL report. For me, as systems develop and borrowing capacity of people enhance, it is very important that this difference is understood.

Credit score is a number arrived at by using information in your credit records submitted by all your lenders to the credit bureau. Credit score is a numerical value at a given moment of time that helps the lenders to assess the credit risk associated with lending money to you.

Higher the number means lower the risk of default for the lender. In India, a number more than 750 out of 900 is treated to be a good score by lenders when they look at CIBIL credit score.

The credit bureau may use multiple factors such as credit lines offered to you, the repayment history, credit utilisation information, and details of loans secured or unsecured loans to arrive at credit score.

The score changes over a period of time and improves if you keep a tab on the extent of credit you avail of and service your loans on time. If you borrow beyond your repaying capacity and fail to repay in time, this score falls, thereby spoiling your credit profile.

However, the numerical value does not offer any other information pertaining to the borrower to the lender. That is where credit report comes into the picture.

Your credit report is a holistic document, which also includes your credit score. A credit report offers wide range of information, besides this. A credit report offers information pertaining to name, gender, age, address, and PAN card number that helps in identifying an individual.

Credit bureaus also have information about the types of loans you have home loan, personal loans, credit cards and the outstanding on each of these. Credit report provides all loans’ details along with age of each loan and your repayment history too. If you have defaulted on any loan or settled a loan in the past, credit report reveals it to the lenders.

Credit reports also enlist number of inquiries. This is the number of times lenders have accessed your credit report while assessing your loan application.

By now, you must have understood that credit report is far more informative in comparison with credit score. While credit score simply gives one numerical value, credit report offers many more qualitative and quantitative inputs to the lenders along with the identification details.

It helps lenders to take an informed decision while lending money. As a borrower you should keep a track of your credit profile. Hence, it is of paramount importance that one keeps track of one’s investments and liabilities. One of the simplest ways to keep your credit profile is to leverage oneself well within our repaying capacity.

The very decision to stretch oneself at a time when saving money is a daunting task, it is crucial that you leverage less and save more. Lastly, do ask for your credit report at least once in a year.

A look at the credit score mentioned in credit report gives you a fair idea of where do you stand in the eyes of lenders and running through credit report helps you identify if there are any lapses at the credit bureau’s end.

The writer is a Co-founder & Director at

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