What is CIBIL Score 



CIBIL Score is an important factor in the loan underwriting process. Lenders will check your CIBIL Score to understand your credit profile, behaviour patterns and repayment habits before they approve your loan
or credit card application. Discover how it’s calculated, what a good CIBIL Score looks like and what can be done to improve yours.


Your CIBIL Score is a three-digit numeric summary of your CIBIL Report and is a reflection of your credit profile and loan-worthiness, based on your credit history and past repayment behaviour. This score can range from 300 to 900. The higher the score, the more confident providers will be in your financial reliability, giving you a better chance of your loan being approved. 


How is CIBIL Score calculated?


Your CIBIL Score is based on your credit history and repayment behaviour as reported by banks and other lenders to TransUnion CIBIL. It’s calculated based on previous loan payment behavior and outstanding amounts, outlined in the ‘Account’ and ‘Enquiry’ section of the CIBIL Report. 


What is CIBIL Report?


CIBIL Report is a detailed record of your credit payment history based on information provided by banks and financial institutions to help loan providers make informed lending decisions.


The report contains:


  • Your CIBIL Score
  • Personal and contact information
  • Employment information, covering your occupation and income
  • Account information including loan and Credit Card account details such as loan amount, current balance and any amount overdue
  • Enquiry information from all lenders you’ve applied for credit with


What are the factors that impact CIBIL Score?


The CIBIL Score takes into account a large number of data points and macro-level credit trends to assess a consumer’s credit-worthiness and his/her likelihood of repaying a loan. This includes the duration of your credit history, long term trends of outstanding balances, transaction history on credit cards, the ratio of actual repayment amount to total amount due, and the number of new accounts opened and number of accounts closed. 


However, the four main factors that can affect your score are:


  • Your payment history – Late payments or defaulting your equated monthly installment (EMI) will negatively impact your score
  • Your credit mix – A good mix of secured loans (like a car loan) and unsecured loans (like a credit card) could have a positive impact on your score
  • Number of enquiries – Multiple enquiries could make it seem as though your debts have increased; negatively impacting your score
  • Credit utilization – High use could indicate a rising amount of debt, which, again, could decrease the likelihood of your application being approved


How can I improve my CIBIL score?


Whether your score is lower than you’d like, or you just want to be in with the best chance of having your loan approved, there are a few ways to improve your score:

  • Make payments on time
  • Don’t use more credit than you need – control your payments
  • Keep up a healthy credit mix without too many unsecured loans
  • Apply for loans in moderation – it’s a good idea to check your eligibility before applying
  • Keep an eye on joint accounts, too; remember all account holders are responsible for ensuring timely loan repayments
  • Check your CIBIL Score regularly and keep on top of any issues

Improving your CIBIL Score can be a lengthy process. Continuous good credit habits and repayment behavior can help you build and maintain a better credit profile and a higher CIBIL Score.


Thinking of applying for an American Express Card now your CIBIL score is in check? Here’s how. Discover the difference between our Credit Cards and Charge Cards, or view all Cards here.