What is credit score?

      Now a days we always get news or information to check your credit score but whats is it?.

 Had you ever think how it is related to your credit received.You must read this blog to understand the credit score concept. This is very good step taken by Central Government of india, this will be very good decision for indian feature.

Why Credit Score Concept Implemented:-

    As we always required loan or else we get the credit for some time period. But we have to pay this credit received amount in the installment basis. But in some case installment is not get paid totally or partially or not get paid on time.

    Customer apply for loan and get the loan from one Bank but some time customer does not paid it's

Installment. In this case he can't take second loan from same Bank. But as credit score concept was not there he can get loan from another company and Bank does not know who is  not paying it's regular installment in another Bank.So how to stop this. to identify the same this concept come into picture.

What Is Credit Score ?

     As customer get the loan from Bank or any credit from any credit providing company. If customer does not pay the installment regularly, then after defined period of time Bank send your NPA classification with your name under PAN no to CIBIL (Credit Information Bureau (India) Limited).

Know more about Credit Score

Who is CIBIL ?

     CIBIL is the one of the best credit information company. CIBIL get the data from all Banks and shops, Post Etc. on monthly basis. CIIBL analysis this data and create the credit score under PAN no and saved in database.

Click here to visit official website of CIBIL

Who can submit the record to CIBIL?

     Any organization which provide the credit to there customers in legal way can submit record to CIBIL. If customer buy a mobile phone from shop on installment basis and if  he does not paid the 

installment properly. The shopkeeper simply send his name in CIBIL under his pan No.

In What Case Record Can Submit To CIBIL?

      1. If you not paid Installment on regular basis.

      2. If you not paid your pending mobile bill amount for long time.

      3. If you not paid Installment of Credit Card on the due date.

      4. If your cheque bounce frequently.  

How Credit Score Concept Work :-   

     When you get the loan from ban, and if you paid the installment on time then Bank send the your NPA classification as STANDARD on monthly basis with all other related information like address, Phone,Overdue amount,Sanction Amount, Overdue Since date, under your PAN card no. if you not paid your installment on regular basis Bank will define your  NPA classification  based on the overdue amount and overdue since date as below

      1. STANDARD ASSETS.

      2. SUBSTANDARD ASSETS.

      3. DOUBTFUL ASSETS.

      4.LOSS ASSETS.

      5.SUIT FIELD.  ( In this case Bank can case you in the court ).

(Click here for RBI circular)

(Image Source -Google)

       If customer  had dose not paid it's previous loan totally. then he had bad credit score in CIBIL under his PAN and in this period of time if he go to another Bank or try to buy the any goods on installment then he will definitely get refused, as every time you apply for loan or buy something on credit. Bank will check your credit score under your PAN card and if it is good then only they accept your loan.  

Thanks You 

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