The Most Effective Tips To Improve CIBIL Score


Every lender verifies before issuing a loan to a borrower on various parameters. In India, RBI has made it mandatory for every bank to check CIBIL score of every applicant. The lender can fetch all your information from your CIBIL report, which includes personal information, credit limits, employment details, your account details and many more.

Any organization can view this CIBIL report before granting a loan or credit card. To avail a loan, you generally need to have a good CIBIL score which does not happen overnight. CIBIL score or Credit score depends upon your past behavior also and not only your present actions. People generally want to improve their credit score only when they need to apply for a loan or credit card, and their score is low.

However, below are a few basic tips which you can follow to improve your credit score.

Timely analysis of credit report: 
The basic step is to check the credit report regularly. It is a good practice as it helps you to keep track of two things, firstly to analyze is there is any default or delay in payment which can lower down your credit score. Secondly, it gives complete information recorded in your credit report which helps you to fix if any negative information is recorded about your credits, in the form of delay or non-payments, which you can then check with the bank and get corrected.

Clear your credit card balance: 
The other thing you should do is to clear your credit card balance. Always spend only as much as you can repay     within your billing dates. Balance includes your EMIs and due on loans also.

Always pay the complete amount within the time limit which helps you to pull up your credit or CIBIL score. It is suggested to keep one or two credit cards which you can keep a check on easily.

Correct any Inaccuracy: 

Make sure to raise any sort of inaccuracy or mistake immediately on once you have found any in your credit report.    

Mistakes can happen from either side. A lender may make any incorrect data entry which you can get rectified, and it is mandatory for the financial institutions to work on the entries within 30 days. Once the error gets resolved, it shows improvement in your credit score. 

Mention of your good old debts in the credit report: 

Many a time people try to get their old debts, which are paid off, removed from their credit reports, but this is not a good practice. Good debts are those debts which you have paid timely, and it also marks your creditworthiness. Thus, it is suggested to let the good debts be on the credit report as long as possible as it helps you with improved CIBIL score.

Clearing EMIs timely: 

Clearing off your EMIs on time, helps you to increase your credit score. If you are planning to purchase a new car, home or home appliances, clear off your EMIs and bills on time as if it creates a drop on your CIBIL score, it may hamper your purchase decision.     

Avoid Taking Risks: 

The best way to improve your CIBIL score is to avoid risks. Two most significant risks are: missing one of your payments and suddenly paying less than usual. The other risky thing is using the card for cash advances which creates much stress.

Authenticate Bill payments: 

Although your utility bills and phone bills are not mentioned here, still you should clear those payments as well, as the service provider may report your debt to a credit rating agency and ask them to mark them as credit defaults in the credit report. 

Check your Credit Utilization Ratio: 

Try to keep your credit utilization ratio within 30% or lesser. It will help you to create a positive impact on the CIBIL score.     

An Increment in Credit Limit: 

If the bank increases the credit limit of your credit card, it does not mean that you can spend beyond your means  now. Instead, if used wisely, helps you to increase your credit scoring. However, you should always spend based on your payback capability.

Joint Applicant Scenario: 

If you have taken a joint loan or credit card then it becomes risky because if the other person doesn’t pay back, then even your credit score will be impacted. The best solution is to check that the loans and EMIs are paid off on time and limit yourself from applying on a joint basis. 

Importance of CIBIL score:

We all live in a time where we need money for our financial requirements. Although there are various banks and lending agencies which lends you money but availing this includes proper verification. CIBIL score is one of them.

CIBIL is the most trusted credit agency of India, and many banks and NBFCs trust its scoring technique. Credit score shows your creditworthiness. A good credit score not only ensures improved chances of getting a loan but also a better interest rate.


The above mentioned ten tips will help you to increase your credit score, but it generally takes some months to develop so always keep patience while your score changes over time.

SEE ALSO: How to stay creditworthy always?