Today we are going to learn how we can improve the Cibil Score? We will tell you 10 effective tips which will prove to be very helpful in increasing your cibil score.
We all know that if your cibil score is not good then any bank will not give you a loan. First of all, you have to get the cibil report because your cibil report is seen first for giving a loan to the bank. Even if your loan gets rejected, the bank does not show your cibil report to you. If you get a cibil report from third-party websites like paisabazaar or any other website then you get 6 to 7 months old data.
Due to this, you are not able to get your correct and updated information and if you get the cibil report from the same official website then it will charge you Rs 550.
If you are active in cibil then your score will be between 300 to 800 and if you are not active in cibil then your score will be -1 or 0. So let’s see how to increase the cibil score
10 Effective Tips to Improve and Increase Cibil Score
Secured Credit Card
The first point to improve cibil score is the Secured Credit Card. Yes, there are many people whose cibil score is so bad that the bank does not give even a small amount of loan. What to do in such conditions? What are the options left with you even after such a bad cibil score?
So here you have the best option Secured Credit Card, in which you give a particular security amount to the bank and in return, the bank gives you a credit card.
Which securities can you keep in a Secured Credit Card?
- Fix Deposit – You can make Fix Deposit (FD) of small or big amount
- Company Share – If you have shares of any company then you can use it
- LIC Policy – If you have any LIC policy then you can keep it as security
If you make a Fix Deposit (FD) of 50,000 in the bank, then the bank gives you a credit card of 40,000 to 45,000 limits. Here the bank does not check your cibil score, you get an instant credit card because the bank is giving you that credit card only when you are depositing some amount in the bank.
After you have a Secured Credit Card, you can increase your Cibil Score. how? You can use that credit card to take a loan of a small amount, such as to buy a mobile phone, to buy home appliances, or to buy small things. But keep one thing in mind that you have to regularize the repayment of that loan.
If you pay the EMI of that credit card regularly, then your cibil score will start increasing gradually and it will have a very positive impact on your cibil score.
If you have a very high cibil score, then you can take a secured credit card. Apart from that, you can take a Gold Loan, because a gold loan is such a loan in which the bank does not check the cibil score before giving you the loan. No matter how bad your cibil score is, you will get a gold loan very easily.
If you want, you can take a small amount of gold loan and if you do its repayment regularly, then it will also have a great effect on your cibil score and will help you to grow it.
Do Not Apply For Multiple Loans Simultaneously
This means that many people need money, then they apply for Mortgage Loans, Business Loans, and many other types of loans at the same time. Not only this, if the loan is not available from one bank, then they will apply for a loan in multiple banks simultaneously.
In such a situation, this thing will affect your cibil score very badly. Therefore you mustn’t apply for multiple loans simultaneously in multiple banks.
Check Your Cibil Report Regularly
Many people never analyze their cibil report. Whether you are doing Businessman, Employee or any other work, it is important for you that you should not be there once in a year but definitely analyze your cibil report.
You will continue to understand what is affecting your cibil score and doing what will keep your cibil score healthy. If you keep checking the report, then you will be aware of all these things and you will avoid doing wrong things.
Raise Online Dispute
Read this point carefully, many people complain these days that there are many such loans in their cibil report which they have never taken. They would never have applied for that loan in the bank, yet he had been reflecting the loan in his cibil and because of that, there is a lot of negative impact on those cibil scores.
So what should be done? If you know that there are many such loans in your cibil report which you have never taken, then you have to Raise an Online Dispute for it. For this, you have to visit www.cibil.com and raise your dispute by going to the help section there.
Example: If a loan of 1 lakh from Abc Bank is visible in your cibil report, then you can click on it and raise the dispute online for it. As soon as you dispute, cibil will send your details to that bank and will say whether the particular customer’s report shows your loan, whether it belongs to him or not because he says that he has never taken it, check it once.
When Abc bank will see the cibil report, it will check whether the loan shown in its report really belongs to him or not. If not then that bank will forward that information to cibil and cibil will remove that loan from your cibil report.
Unutilized Credit Limit
If you use a credit card and make full use of its limit every month, then this thing can also affect your cibil score. Utilized Credit Limit means that suppose your credit card limit is 1 lakh and you use a limit up to 90,000 every month then it means that your credit utilization is 90%.
What should be Healthy Credit Utilization?
According to a report by FICO, if a customer uses a credit utilization limit of up to 30%, it will have a positive impact on his cibil score. In such a situation, we can say that Credit Utilization of less than 30% is very good, Credit Utilization of 30% to 70% is fine and Utilization of more than 70% can negatively impact your score or not good.
Tip: If your bank is giving you a higher credit limit then you should accept it so that your utilization is less and your cibil score is good.
Monitor Your Joint and Guaranteed Loans Many
People also say that I have never delayed my loan repayment, I am paying my EMI regularly, yet how my cibil score is so low? The reason for this may be that you have been a guarantor in the loan of someone who does not pay the EMI of his loan on time, then this thing can also affect your cibil score.
No EMI Payment By Cash
You must have heard or it may have happened to you that some Cooperative banks have asked you to repay your loan in cash. Something happens if our EMI date is 7 but the bank allows us to make late payments sometimes.
Because of this also there is a lot of impact on cibil, the later you make your payment, the more impact will be on your cibil score.
Never Settle / Write Off Any Loan
To understand this, we will look at an example, suppose you have taken a credit card with a limit of 1 lakh from a bank and you buy something which costs 1 lakh and then break it and throw it away. In such a situation, the bank will repeatedly send you reminders that you have to make this much repayment but you did not reply.
On getting the call from the bank, you answered that I have 35 thousand now, if I want to take that much, then take it, otherwise, I am not going to pay anything.
After a little talk or some settlement, you agree to give 50 thousand, in such a situation, the bank will take that 50 thousand rupees from you but in your cibil report, the settlement will be written in front of that transaction. It means that you have forced the bank to take less amount. In this case, your cibil will be bad.
Written Off is even worse than this like you shopped for 1 lakh and told the bank that I am not going to pay a single rupee, do whatever you want to do! In such a situation, the bank will cancel your credit card and it will be mentioned in the cibil report that this credit card is written off. This can make the cibil score very bad.
At Least Pay Minimum Due
Understand it in such a way that your credit card’s total due or bill payment is 10 thousand and it is minimum due is 1000. This means that if your financial situation is not good and you cannot fill 10 thousand, then they say that you should fill at least 1000.
If you cannot even pay the Minimum Due, then this thing can also affect your cibil score badly.