By Apoorva Rathore

Credit Information Bureau(India) Limited• Founded in August 2000

• Headquarter in Mumbai, Maharashtra, India

• Mr Satish Pillai, Managing Director

• Mr M. V. Nair, Chairman

• 900 strong member base including all leading public &

private sector banks, financial institutions, NBFCs and

housing finance companies

Shareholding Pattern

What does CIBIL do?

• Collects and maintains records of an individual‘s payments pertaining

to loans and credit cards

• Records are submitted by banks and other lenders, on a monthly basis

• Credit Information Reports (CIR) is created

• Credit scores are provided to lenders to help evaluate and approve

loan applications.

Role in the Loan Approval Process• Credit Score helps loan providers quickly determine, who they

would like to evaluate further to provide credit.

300 ≤ CIBIL TransUnion Score ≤ 900

Loan providers prefer credit scores ≥ 750.

• Analysis of the CIR to determine the eligibility i.e. the applicant's

ability to take additional debt and repay additional outflows given

their current commitments.

• The loan provider will request for the applicant's income proof and

other relevant documents in order to finally sanction the loan.

CIBIL for us as an individual

• CIBIL score was made available to the individuals since April

2011.

• Faster loan approvals

• Empowers individuals to see world financial and credit

history more clearly and take better decisions

Example: How good credit history helps in getting lower rates for loans?

Bank A:

11.25% for a tenure of 5 years

EMI = Rs.12,999

Bank B:

10.75% for a tenure of 5 years

EMI = Rs.12,856

Mr. Roy wanted a car worth Rs.10 lakhs and already had Rs.4 lakhs.

Auto loan of Rs.6 lakhs

He called Bank A to decline their offer since Bank B had given him a better

quote. After checking his CIR, Bank A matched the offer by giving him a rate

of 9.85%; where the EMI decreased to Rs.12,601, resulting in a total saving of

Rs.23,880 over the period of 5 years.

Hence, good credit history and credit score earned him a 3% discount on the

loan.