Latest news with #CreditInformationCompanies(Regulation)Act
Mint
25-07-2025
- Business
- Mint
How to spot and fix credit report errors that lower your credit score
Every small inaccuracy in your credit report can quietly bring down your credit score. Thus lowering your chances of securing a personal loan or credit card. Now it is a given that many borrowers regularly track their credit scores, relatively few review their credit reports in complete detail. Due to this they often miss hidden mistakes and errors that could cost them favourable terms and lower interest rates on their personal loans. Credit reports compiled by CIBIL, Equifax, Experian and CRIF High Mark can often contain discrepancies and disputes that go unnoticed by borrowers and can later hamper credit scores. Some common credit report mistakes include: Personal information errors (wrong PAN, Aadhaar details, date of birth or address). Closed personal loans marked as active. Payments of EMIs, credit card bills not updated by lenders. Accounts wrongly reported as delinquent i.e., as accounts that have missed personal loan EMIs, credit card bills or other associated credit repayments. Duplicate loan entries, wrong data or incorrect ownership details. All such errors may easily lower a borrower's credit score by 50-100 points. This is enough to shift a borrower from an 'excellent' or 'very good' category to a 'moderate risk' category, hence impacting both approval chances, applicable interest rates along with associated repayment terms and conditions. To streamline the same process the Reserve Bank has now mandated financial institutions to refresh credit bureau data every 15 days. Earlier, updates were not required to be done frequently. That is why this move is expected to bring credit reports closer to real-time accuracy, benefiting millions of retail borrowers. Currently, borrowers are permitted to avail one free credit report per year from their respective credit bureau. Keeping the same factor in mint, it is prudent for borrowers to closely monitor their credit reports. In case of reviewing your credit report you find an error then you should follow the given steps to resolve the situation: Raise a dispute on your respective credit bureau's official website. Provide supporting documents such as closure letters, errors or payment proofs. Contact the concerned lenders customer support team if the issue persists. Discuss your problem with the designated customer support team of the credit bureau. Monitor the status, disputes must be resolved within 30 days under the Credit Information Companies (Regulation) Act, 2005 (CICRA) framework. This matters because a single reporting error can result in higher personal loan EMIs, lower loan amounts, outright rejection or delays in availing credit. It is important to acknowledge the fact that credit reports are no longer optional, this is a consequence of credit becoming central to financial life in the country. For all personal finance updates, visit here. Disclaimer: Mint has a tie-up with fin-techs 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
25-07-2025
- Business
- Business Standard
RBI to consider giving Section-8 MFI firms' access to credit bureaus
The lack of access to credit information leaves Section-8 MFIs in the dark about the worthiness of their clients, while allowing borrowers to exploit the arbitrage between Section-8 and mainline MFIs Raghu Mohan New Delhi Listen to This Article The Reserve Bank of India (RBI) is considering whether Section-8 companies or not-for-profit (NFP) entities involved in microfinance should get access to credit information companies (CICs). Under the Credit Information Companies (Regulation) Act (2005), only RBI regulated entities (REs) are allowed to hook into CICs or credit bureaus – that is sharing data with and accessing it from them. This leaves out data flow to Section-8 microfinance institutions (MFIs) as only non-banking financial companies (NBFCs) dedicated to microfinance (NBFC-MFIs) are eligible. A submission was also made to the banking regulator that Section-8 MFIs be allowed to convert to mainline NBFCs-MFIs.
Mint
20-05-2025
- Business
- Mint
Credit score: Banks take THESE 5 key decisions based on your creditworthiness
In India's rapidly evolving financial landscape, clearly understanding what lenders foresee or find out from your credit score is crucial. As a general rule, currently a credit score of 750 or above is considered excellent. Such a high credit score and unblemished repayment history significantly influences loan approvals by making the entire process easier along with more friendlier interest rates. The Reserve Bank of India (RBI) has also played an integral role in developing the credit score ecosystem in the county. The RBI basically licenses and regulates credit bureaus in the country under the Credit Information Companies (Regulation) Act, 2005. This again explains the importance of maintaining a clean and healthy credit profile. Rishabh Goel, Co-founder & CEO, Credgenics, says 'When you apply for a loan or credit card, your credit score gives lenders a quick overview of your financial habits and creditworthiness. It reveals key insights such as your payment discipline, whereas delays in bill or loan payments signal risk; outstanding debt levels, where high balances may indicate financial stress; the length of your credit history, which helps gauge long-term financial behavior; your credit mix, showing how well you manage different types of credit; and recent credit activity, where multiple applications may suggest instability. Together, these factors help lenders assess how likely you are to repay borrowed funds responsibly and on time.' Hence, keeping the above factors in mind, let us understand the five key insights lenders derive from an individual's credit score: Creditworthiness assessment: Financial institutions and lenders check your credit score to understand your creditworthiness and reliability in repaying the availed debts. A higher credit score and a clean repayment history indicates a lower risk profile. This enhances the chances of the borrower of loan approvals and seamless credit card clearance. Determination of interest rates: The credit score assigned to you directly influences the applicable interest rates offered. Borrowers with higher credit scores easily receive loans in a smooth fashion. This results in the reduction of the overall cost of borrowing. Credit limit decisions: Banks consider your credit score while setting your credit limits and the maximum amounts they can risk on you as a borrower. A higher score suggests a safe borrower thus a higher credit limit naturally. This also helps borrowers in providing greater financial flexibility. Loan terms and tenure: A strong credit profile or a strong credit score i.e., any score in the range of 750 or more can positively influence the terms, tenure of the loan. Such a score has the potential to offer more extended repayment periods and better conditions. Clearance of premium credit products: Premium credit cards, enhanced benefits and lucrative rewards all become possible with a clean repayment history and a higher credit score. The RBI has now mandated all banks and NBFCs to update credit bureau records every 15 days. This is a reduction from the earlier monthly cycle. Under this new regulation lenders are required to submit credit information to credit information companies (CICs) such as CIBIL, CRIF High Mark, Experian and Equifax among others on a fortnightly basis. The CICs then must process and update this data within the stipulated time. This simple step hence ensures that the credit profiles of borrowers are updated and current. The development also allows borrowers to track their credit health more proactively and consistently. Thus helping lenders base decisions on real-time data, improving accuracy and trust in the credit ecosystem. Therefore, maintaining a clean credit profile and strong credit score is crucial for easier loan approvals, favourable interest rates and superior credit limits. With RBI's timely updates borrowers benefit from accurate credit profiles, fostering smarter lending decisions and improved financial opportunities. 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.
