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Mint
5 days ago
- Business
- Mint
Personal credit score vs business credit score: What's the real difference?
If you run a small business or are self-employed, it is very important to know the difference between your personal and business credit scores. Each of these two identities of finance serves different purposes and can affect long-term financial planning, borrowing, and reputation. Your personal credit score is a three-digit number that typically ranges from 300 to 900, and is a measure of your creditworthiness. It is based on: CRIF High Mark, Equifax, Experian, and CIBIL update these reports. Lenders rely on this score to make decisions on personal credit products such as personal loans, credit cards, and so on. The company credit score of your registered business entity is a reflection of how financially secure it is, which is determined by the following: Repayment of company loans. Credit/loan facilities. Trade connections and fulfillment of suppliers' credit terms. Registry data in relation to PAN and associations. It is essentially run by bureaus that may be business-specific and is utilised when you apply for business loans, credit lines, vendor credit, and sometimes tenders and partnerships. For entrepreneurs and solopreneurs: If your organisation is an unincorporated sole proprietorship, your personal credit and business credit scores are connected. In general, many lenders will consider both when they review your loan application. For incorporated entities: Registered businesses are fortunate in that they benefit from distinction since personal and business liabilities are separate. Although if there is a default, it could affect your personal credit score if you provided a personal guarantee for a business loan. Even in the case of commercial loans, poor patterns of repayment on personal loans suggest a degree of risk, which could lead to delays in approvals or higher interest rates. If you have a high personal credit score, you may get personal guarantees for a better deal. A business loan default may affect your personal credit score directly, particularly if you are the personal guarantor on the business loan. Robust business credit reports and financial discipline will help to protect your personal obligations from the liability of your business. Pay your personal credit card invoices on or before the due date. Keep your credit card usage below 30%. Diversify your credit mix (e.g., credit card, car loan, secured personal loan). Register formal business entities (proprietor partnership, Pvt Ltd) to enhance your company's credit score. Open a transactional bank account in the name of the business. Create an invoice through the accounting channels and properly manage trade credit. Use NBFC partners or RBI-approved CIUs to launch your business loans. In conclusion, the cornerstone of a business owner's financial profile is made up of two related elements: the personal and business credit scores. Business credit reveals an entity's financial maturity while personal scores indicate an individual's reliability. By managing and monitoring both personal and commercial credit, business owners can enhance their credit report, safeguard their funds, and obtain better loan terms. For all personal finance updates, visit here. Disclaimer: Mint has a tie-up with fintechs for providing credit; you will need to share your information if you apply. These tie-ups do not influence our editorial content. This article only intends to educate and spread awareness about credit needs like loans, credit cards, and credit score. Mint does not promote or encourage taking credit, as it comes with a set of risks such as high interest rates, hidden charges, etc. We advise investors to discuss with certified experts before taking any credit.
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Business Standard
31-07-2025
- Business
- Business Standard
Paying only minimum due on your credit card? You could be in a debt trap
A credit card debt trap occurs when you are paying only the minimum due, or Using one card to pay off another. To avoid this, spend no more than 30 per cent of the card limit each month Himali Patel Mumbai Listen to This Article Credit card delinquencies in the 91–360 days overdue category rose 44.3 per cent year-on-year, from Rs 23,475.6 crore in March 2024 to Rs 33,886.5 crore in March 2025, according to a report by CRIF High Mark. These figures underline the need for customers to be more cautious in their use of credit cards. Reasons for rising NPAs A major reason for rising credit card NPAs is the minimum payment mindset. 'According to a report by the Reserve Bank of India (RBI), only 40 per cent of Indian credit card holders repay their full outstanding amount every month. This encourages prolonged debt cycles
Mint
30-07-2025
- Business
- Mint
How to check your free CIBIL, Equifax, Experian, and CRIF credit reports online?
Every individual in the country is entitled to one free credit report every year from each of the four leading credit bureaus, according to the Reserve Bank of India guidelines. The four bureaus are TransUnion CIBIL, CRIF High Mark, Equifax, and Experian. Here is a step-by-step guide that will assist aspirational individuals in procuring their free credit report directly from the official website of the above-mentioned credit bureaus. Visit the TransUnion CIBIL website: and register using your name, PAN, date of birth, mobile number, and a valid email address. Complete identity verification using the OTP sent to your registered contact to access and download your free credit report. This free report is available only once every 12 months from the date of your last request. Visit the Equifax website: and create an account by providing details such as PAN, address, mobile number, and a working email ID. After successful identity verification, your free credit report will be generated online. Further, you can also request a credit report offline by mailing a properly filled credit report request form with ID and address proof to the credit bureau. Keep in mind that on similar to CIBIL, you are entitled to one free credit report every 12 months. Reach out to the website at and enter your basic details such as PAN, Aadhaar, mobile number, and a working email ID to initiate the process. Verify your identity by using the OTP, i.e., one-time password sent to your registered mobile number, to access your credit report. Experian, like the other credit bureaus, provides one free credit report every year, i.e., every 12 months. You can view, download, and save this report for your records. First, visit the CRIF High Mark website at and complete the registration process by submitting the form with details such as PAN, Aadhaar, address, email ID, and mobile number. Authenticate your identity through the OTP sent to your registered mobile number to proceed. This will help in making sure that the report is downloaded by you, i.e., the concerned person only. Once the process of verification is complete, you can download your free annual credit report in PDF format for future reference. Therefore, do keep in mind to always use the official portals of each credit bureau for maximum data security and privacy. Furthermore, checking and downloading your credit report is a 'soft inquiry' and it does not negatively influence the credit score. On the contrary, reviewing your credit report consistently helps in detecting inaccuracies and mistakes. It also helps in reducing fraud risk and helps in maintaining appropriate financial health. Finally, in case you face any doubts with regards to the entire process of obtaining your free credit report, you can also reach out to the customer service team of the above-mentioned credit bureaus. This can be done through their official websites under the customer grievance section. For all personal finance updates, visit here. Disclaimer: Mint has a tie-up with fintechs for providing credit; you will need to share your information if you apply. These tie-ups do not influence our editorial content. This article only intends to educate and spread awareness about credit needs like loans, credit cards and credit scores. Mint does not promote or encourage taking credit, as it comes with a set of risks such as high interest rates, hidden charges, etc. We advise investors to discuss with certified experts before taking any credit.
Mint
28-07-2025
- Business
- Mint
Personal loan volume spikes, year-on-year growth drops in FY 2025: Report
Resorting to borrowing when the credit need arises is a typical behaviour of consumers. Be it for car, home, consumer durables or for personal needs, borrowing is the part and parcel of life of consumers everywhere. CRIF High Mark released its annual report listing out latest trends relating to borrowing trends of Indian consumers. The report highlights that personal loan POS grew from ₹ 10.7 lakh crore to ₹ 14.6 lakh crore over two years but year-on-year growth fell sharply from 25.2 percent in FY2024 to 9.1 percent in FY2025. The report titled How India Lends Credit Landscape in India FY 2025 provides in depth insights into originations, portfolio and delinquency trends across major product categories. When it comes to the lender type, the share of NBFCs has increased from 27.6 percent to 36.4 percent in the past two years from 2023 to 2025. During this time, the share of private banks fell from 32.5 percent to 29.2 percent. The share of PSU banks declined from 35.3 percent to 30.5 percent. The share of origination value for personal loans over ₹ 10 lakh has risen steadily from 28.2 percent in FY24 to 30.9 percent in FY25, indicating a growing preference for higher-value loans. Meanwhile, the share for loans between ₹ 1 lakh and ₹ 10 lakh has declined, suggesting a shift away from mid-sized lending. Interestingly, loans under ₹ 1 lakh are also gaining market share in origination value, driven by the increasing adoption of digital and small-ticket lending solutions, especially by NBFCs. Loans below ₹ 1L also continue to dominate in volume, increasing from 87.1% in FY24 to 89.3% in FY25. The origination value of two-wheeler loans jumped from ₹ 99,543 crore in FY24 to ₹ 110,056 crore in FY25, though the growth rate moderated from 25.1 percent to 10.6 percent over the same period. The report suggests that tighter credit policies aimed at managing default risks, along with increasing stress among sub-prime borrowers, may have influenced this slowdown. Two-wheeler loan delinquencies increased across all lender types from Mar '24 to Mar 2025, with PAR 31-90 percent for PSU Banks climbing from 1.27 percent to 1.61 percent and private banks rising from 3.27 percent to 3.62 percent. In terms of credit cards, the share of private banks fell from 70.8 percent to 69.6 percent (active loans) and from 69.9 percent to 68.9 percent (portfolio outstanding). New card originations fell to 216.4 lakh in FY25, down 26.4 percent YoY, reversing the strong growth seen in FY22 and FY23. This follows a peak of 294.1 lakh cards that were issued in fiscal 2024, indicating a clear slowdown in momentum and tightening credit criteria. For all personal finance updates, visit here Disclaimer: Mint has a tie-up with fintechs for providing credit, you will need to share your information if you apply. These tie-ups do not influence our editorial content. This article only intends to educate and spread awareness about credit needs like loans, credit cards and credit score. Mint does not promote or encourage taking credit as it comes with a set of risks such as high interest rates, hidden charges, etc. We advise investors to discuss with certified experts before taking any credit.
Indian Express
27-07-2025
- Business
- Indian Express
Debt on Plastic: Credit card delinquencies surge 44% to Rs 33,886 crore amid rising consumer spending
India's credit card economy, a symbol of growing consumer confidence and digital empowerment, is showing some signs of strain. Credit card delinquencies in the 91–360 days overdue category have soared by a staggering 44.34 per cent over the past year, reaching Rs 33,886.5 crore as of March 2025, up from Rs 23,475.6 crore in March 2024, according to the latest data from CRIF High Mark. This sharp rise highlights a growing vulnerability among borrowers, particularly in the 91–360 days category, a segment that banking regulations categorise as non-performing assets (NPAs) in the case of bank loans. Effectively, credit card holders have defaulted on nearly Rs 34,000 crore of debt that has remained unpaid for over 91 days. The breakdown of distress A closer look at the numbers reveals a disturbing trend. In the 91–180 days overdue segment alone, the delinquent amount jumped to Rs 29,983.6 crore, compared to Rs 20,872.6 crore a year earlier, and has almost doubled from the March 2023 level, data prepared by CRIF High Mark for The Indian Express says. This reflects not just a growing reliance on credit but a mounting inability — or unwillingness — to repay on time. CRIF High Mark, a credit bureau registered with the Reserve Bank of India (RBI), noted a steady uptick in the percentage of portfolio at risk (PAR), which tracks overdue payments. In March 2025, PAR in the 91–180 day bucket reached 8.2 per cent, rising from 6.9 per cent in March 2024 and 6.6 per cent in March 2023 — a consistent three-year climb. For loans overdue 181–360 days, the PAR rose to 1.1 per cent, up from 0.9 per cent in 2024 and 0.7 per cent in 2023. These trends signal both short-term and long-term stress in the unsecured credit market, especially as consumers lean heavily on plastic for everyday and discretionary spending. Credit card outstanding was Rs 2.90 lakh crore as of May 2025 as against Rs 2.67 lakh crore in May 2024, according to the RBI. A credit-driven consumption boom The increase in delinquencies is set against the backdrop of an explosive rise in credit card usage across the country. The value of credit card transactions reached Rs 21.09 lakh crore by March 2025, surging from Rs 18.31 lakh crore the previous year — a nearly 15 per cent jump. This boom mirrors India's post-pandemic economic recovery and reflects rising consumer confidence. Credit card spending in May 2025 alone was Rs 1.89 lakh crore, up dramatically from Rs 64,737 crore in January 2021. Likewise, the number of credit cards in circulation has ballooned. As of May 2025, 11.11 crore credit cards were active in India, compared to 10.33 crore in May 2024 and just 6.10 crore in January 2021, according to RBI data. People tend to borrow and spend more when they're optimistic about their financial future, but may also rely on credit cards to maintain their standard of living when wages stagnate or prices rise, said an investment analyst. Rewards, offers — and debt traps What's fuelling this sharp uptick in usage? Banks and fintech firms have aggressively promoted credit card adoption with attractive incentives: cashback rewards, travel perks, interest-free EMIs, and airport lounge access. For many consumers, especially in urban and upwardly mobile segments, credit cards have become synonymous with convenience and lifestyle. But the ease of swiping has come with a hidden cost. Credit card debt is among the most expensive forms of borrowing in India. Banks typically charge between 42 per cent and 46 per cent annual interest on unpaid balances beyond the interest-free period. 'Customers often get lured by flashy offers and rewards. But if they don't repay on time, they end up paying exorbitant interest,' said a senior bank official. A few missed payments can quickly spiral into a debt trap.' Why it matters The sharp increase in delinquencies poses a risk not just to individual borrowers but also to the broader financial system. Credit card loans are unsecured, meaning they are not backed by collateral. Rising defaults can affect banks' balance sheets and prompt tighter lending norms, thereby slowing credit growth, a key driver of consumption in India. The RBI indeed hiked the risk weight on credit card outstanding in 2023. Moreover, defaults affect credit scores. For individuals who fall behind on payments, the financial impact is immediate and long-lasting. A damaged credit score or history can limit future access to loans, credit cards, or even rental agreements and job opportunities in some sectors. While credit cards offer flexibility and financial freedom, their misuse or overuse can have serious consequences. As more Indians embrace digital credit, the focus must now shift from spending to managing debt responsibly, experts say. Banks, regulators and fintechs need to step up educational initiatives around interest rates, billing cycles, and repayment discipline. For consumers, the message is clear: credit cards are a tool — not free money. Use them wisely, or risk paying a heavy price.
