credit scores

Tweets on 2011-09-14

by Vinaya HS on September 14, 2011

in Finance

Something interesting I found in the comments archive and which I felt would benefit a wider audience.

I once had a Savings Account with Standard Chartered Bank (SCB) through my employer. Once I shifted my job, I naively emptied the account to have a zero-balance and left it at that. About 6-years later, I got a Manhattan Credit Card (Manhattan is a venture being run by SCB). When I registered for online access I noticed that it was automatically linked to my old Savings Account and the Account had a negative balance of about Rs 3,500. Upon contacting the Bank, they said that since the PAN number was the same, it was my account. Luckily upon my request, they wrote the balance off and closed the account (after I gave a letter in writing for the same).

The moral of the story is that it is always better to get a Savings Account closed rather than just emptying its contents and assuming that it will get closed on its own.

The biggest problem now is that CIBIL (the Credit Bureau in India) is collecting data on all defaults. So you could end up getting a black-mark against your name just because you got ‘lazy’ or tried to save a Rs 100 closing charge.

Looking back, I’ve always advocated (here, here, and here) full closure of your accounts.

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According to this circular issued by the Reserve Bank of India, we’ll now have three credit information companies:

  1. Credit Information Bureau (India) Ltd. or CIBIL
  2. Experian Credit Information Company of India Private Ltd.
  3. Equifax Credit Information Services Pvt. Ltd.

CIBIL is in operation since January, 2001; the other two are yet to commence the business of credit information in India.

That said, I still haven’t asked for my credit report. Have you?

Awareness Fridays is my initiative to spread awareness on topics relevant to personal finance — every Friday. I urge you to take some time off and absorb this information — it’s pretty useful. And, as always, do spread the word if you find this useful.

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Six months back, I’d complained that,

While one can request for a copy of one’s credit report while applying for credit, what about those who’re not inclined to avail credit right away. How then does one access one’s credit information report? What about those who’ve already availed credit facility? Surely, they’d like to know their credit scores too.

Here’s some great news — you can now apply for and obtain your credit information report from CIBIL. A quick extract reads,

You can now access your Credit Information Report (CIR) directly from CIBIL. As you may be aware, your CIBIL CIR is a factual record of your credit payment history compiled from information received from credit grantors. The purpose is to help credit grantors make informed lending decisions — quickly and objectively, and enable faster processing of your credit applications to help provide you speedier access to credit at better terms.

Read the sections under the menu heading “Your CIBIL Credit Report” for a thorough understanding. I plan to apply for and obtain my CIR in the coming week. Let me know if you’ve been able to obtain yours.

Tip Tuesdays is my initiative to share practical personal finance tips — every Tuesday. I’d be delighted if you could share a tip or two from your own experiences. Drop a comment to submit your tip. And, as always, do spread the word if you find this useful.

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I’d raised a few questions when I last wrote about accessing your credit scores in India. A couple of days later, the Economic Times published an interview featuring Credit Information Bureau (India) Limited (CIBIL) addressing these very concerns. It’s a must read, especially if you’ve previously availed credit or are planning to.

Awareness Fridays is my initiative to spread awareness on topics relevant to personal finance — every Friday. I urge you to take some time off and absorb this information — it’s pretty useful. And, as always, do spread the word if you find this useful.

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I’ve previously written about the Credit Information Bureau (India) Limited (CIBIL). To repeat,

CIBIL or Credit Information Bureau (India) Limited is India’s first credit information bureau and is a repository of information, which contains the credit history of commercial and consumer borrowers. CIBIL provides this information to its Members (i.e. banks and other financial institutions) in the form of credit information reports.

But what about you? Can you access your own credit report? According to this recent circular issued by the Reserve Bank of India,

  • Any person, who applies for grant or sanction of credit facility, from any credit institution, may request such institution to furnish him a copy of the credit information obtained by such institution from the credit information company.

  • Every credit institution shall on receipt of such requests, furnish to such person a copy of the credit information subject to payment of charges.

  • A maximum fees of Rs 50 can be charged for this purpose.

It’s certainly a step in the right direction — and good for you if you’ve been thinking of availing credit, but what about those who’re not inclined to avail credit right away. How then does one access one’s credit information report? What about those who’ve already availed credit facility? Surely, they’d like to know their credit scores too. And what exactly does credit facility include? Is credit cards, loans (any type), and overdrafts an exhaustive list?

Raises more questions than it answers. What do you think?

Awareness Fridays is my initiative to spread awareness on topics relevant to personal finance — every Friday. I urge you to take some time off and absorb this information — it’s pretty useful. And, as always, do spread the word if you find this useful.

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Awareness Fridays: Have You Heard of CIBIL?

by Vinaya HS on February 27, 2009

in Finance

Have you ever been rejected for a loan or some other form of credit (such as a credit card) and then wondered why your case was rejected? Though a financial institution must now tell you why your application was rejected, there is a lot more that goes on behind the scenes.

Enter CIBIL.

CIBIL or Credit Information Bureau (India) Limited is India’s first credit information bureau and is a repository of information, which contains the credit history of commercial and consumer borrowers. CIBIL provides this information to its Members (i.e. banks and other financial institutions) in the form of credit information reports.

I’ll let the Frequently Asked Questions explain the rest.

Awareness Fridays is my initiative to spread awareness on topics relevant to personal finance — every Friday. I urge you to take some time off and absorb this information — it’s pretty useful. And, as always, do spread the word if you find this useful.

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