How to check your credit score for free online
Wondering how to check your credit score? Our article will guide you through the process and explain the importance of a good credit history
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Last Updated: Jun 10, 2024, 15:45 IST1 min
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Credit score checkers provide a convenient way to access and understand one"s creditworthiness by generating a numerical representation known as a credit score. Users can monitor their credit health, track changes, and receive insights into factors influencing their scores, such as payment history and credit utilisation. Additionally, credit score checkers offer personalised tips to improve credit standing and help users make informed financial decisions.
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In this article, we’ll learn how to check your credit score and its importance.
What is a credit score, and how is a credit score calculated?
A credit score is a three-digit number that represents a person"s creditworthiness. It serves as a key factor for lenders in assessing the risk associated with extending credit. Usually ranging between 300 and 900, a higher score indicates better creditworthiness, making it more likely for a person to qualify for loans and credit cards with favourable terms.Factors including payment history, credit utilisation, length of credit history, types of credit accounts, and recent credit inquiries determine credit scores. Credit reporting agencies use sophisticated algorithms to analyse this information and generate a comprehensive credit score, providing lenders and individuals with an efficient way to evaluate and manage credit risk. Regularly monitoring and understanding one"s credit score is essential for maintaining financial health and making informed borrowing decisions.
Different credit bureaus available in India
A credit bureau acts as a credit agency that gathers and disseminates individuals" and organisations" credit information in the form of a CIBIL score, aiding in evaluating creditworthiness for lenders and creditors. Here are the four credit bureaus in India that can provide a credit score for you:TransUnion CIBIL score:
TransUnion CIBIL is a comprehensive credit bureau providing analyses for organisations and individuals. The credit score scale ranges between 300 and 850, with a score of 720 or above considered excellent.TransUnion CIBIL has a broad membership base, including major financial institutions, lenders, NBFCs, and banks.
You may have heard the terms CIBIL score and credit score used synonymously. It’s important to remember that while all four of the credit bureaus in India can provide you with a credit score, only CIBIL calculates your credit score as the ‘CIBIL score’.
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Below, we have mentioned different CIBIL score ranges and what they signify:
First Published: Jun 10, 2024, 15:45
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