Check Your Credit Score For FREE
A good credit score is the key to your financial flexibility and credit worthiness and can help you with loans to fulfill every need, for your business, for that dream wedding, for the dream home and the bike or scooter you’ve been planning to buy.
The idea of taking a loan online might seem quite enticing. However, there’s one major aspect that needs to be kept in mind if you wish to maximise your chances of successfully attaining a loan – your credit score.
It doesn’t matter whether you wish to opt for a personal loan, home loan, business loan, or anything else along the same lines – without considering your credit score and maintaining it at acceptable levels, you might find yourself in a sticky financial situation further down the line.
However, don’t fret. Clix Capital will take care of all these worries for you. We’ve partnered with Experian to provide an accurate credit score for free and help you map out your credit eligibility with ease. Manage all your finances in one place and get personalised recommendations from us to help you make better financial decisions. Read on to find out everything you need to know about the concept of a credit score!
What Is A Credit Score?
Credit score refers to a three-digit number ranging between 300-900, which estimates how likely one is to repay one’s debt. Banks and other money lenders consider this score to decide whether a particular loan or credit card application can be approved or not. An individual’s credit scores are essentially calculated by tracking their initial payment records and identifying if they make payments on time. The number of accounts maintained by the user also contributes to the calculation of their credit score.
Why Is My Credit Score Important?
An individual’s credit score is a very essential element of their financial picture. Clix Capital and other lenders use this information from the credit report – especially the credit score – to assess the risk of lending money to a borrower. If their credit score is high, they are less likely to be seen as a risk to the lender. On the other hand, if the score is on the lower end, lenders may doubt the borrower’s intentions to repay the loans. Here are a few reasons why it is absolutely necessary to maintain a solid credit score.
Your Scope Of Borrowing Money Depends On Your Credit Score
First and foremost, the most prominent thing we need to point out when it comes to your credit score is that fact that all your financial requirements hinge upon this number. Clix Capital and other such lenders always take this credit score into consideration while deciding the eligibility of a potential borrower and the total sum of money they can be trusted with.
Your Credit Score Can Have A Role To Play In Your Insurance Premiums
Be it getting vehicle insurance or insuring your home, your credit score plays a major role in defining your premium. Insurance agents characteristically create what is referred to as an “insurance score,” which is based on your credit score along with a few different factors. A low credit score can cause you to pay additional premium costs each year, whereas a good credit score can qualify you for a lower premium.
Unlocks Access To Better Financial Offers
A solid credit score gives you access to many financial offers and opportunities to avail discounts. With a decent credit score, you may get deals which help you refinance your home at a lower interest rate. Moreover, you may also be entitled to several other benefits like better rewards – such as credit cards with considerably lower interest rates. These deals may even help you manage your financial resources in the longer run.
How Is My Credit Score Computed?
Your credit utilisation ratio plays a major role in deciding your credit score. For the uninitiated, this credit utilisation ratio is computed by comparing one’s overall outstanding amount to the total credit limit available to them. Ideally, using around 30%-40% of your overall credit limit will help you maintain a high score.
Length Of Credit History
A credit score is computed by taking into account one’s credit history. So, it only makes sense that people with a longer credit history will have more information to provide regarding their credit transactions. Handing your credit responsibly for extended periods of time will go a long way in ensuring that your credit score comes out accurately as well.
Since we’re already on the topic of credit history, it’s time we talk about another aspect pertaining to this element that we’ve touched upon briefly – consistency in credit payments. It doesn’t take an expert to understand that paying your dues (such as bills, EMIs, loan amounts) on time will go a long way in positively impacting your credit score.
A factor that most people aren’t aware of when it comes to their credit score is the fact that inquiring about this score can also impact your credit rating. Don’t worry – we’re not talking about an individual checking their credit score. Rather, it’s when multiple banks and NBFCs frequently check your score that there’s an impact – albeit, a minor one.
While it may not have a major impact, having a good mix of both secured and unsecured credit can certainly play in your favour while computing your credit score. Avoid taking too much of one, since it might upset this balance – and, consequently, your credit score.
What Does My Credit Score Range Imply?
NA/NH: If your credit history isn’t lengthy or descriptive enough, then you won’t have a quantifiable credit score. Instead, your report will show your score as Not Applicable (NA) or No History (NH).
- 300-549: Having a credit score in this range is not ideal in the slightest. There’s a high chance that your loan request will be rejected outright. Even if your request will be approved, significant restrictions will be imposed on the same due to the lack of reliability indicated by this score.
- 550-649: A credit score in this range is considered to be an average score. If you wish to attain approval on sizeable loan requests with lesser restrictions, then measures need to be taken to ensure the same.
- 650-749: This range is indicative of a good credit score. You should experience little to no problems with lenders giving you the credit you require.
- 750-900: A credit score above 750 is an excellent credit score that places the ball in your court. Approvals on your loan requests will almost never be rejected – in fact you can actually negotiate for better interest rates and lower restrictions at this point.
Does Credit Score Get Impacted If I Enquire About It?
It relies upon the sort of inquiry you are making. There are two sorts of inquiries – hard and soft inquiry. Hard inquiries send your Credit Score down by few points while soft inquiries don’t much affect your Credit Score. An inquiry made by an individual is known as a soft inquiry. We make some investigations for your benefit while getting your Experian credit Score.This won’t sway your Credit Score in any way. In addition, checking your Credit Score on our website is absolutely free! It’s best adviced to do credit score check occasionally and be up to date. Keep a tab on your Credit Score before applying for a card or loan. You will know whether your score will hold you over, off-chance or whether it needs fixing. A hard inquiry is a point at which we check your Credit Score to take a choice on your credit application. Apart from accessibility to loans and credit cards, your credit score has a bearing on your insurance as well. Be it home insurance or vehicle insurance, your credit score plays a significant role in determining the offers you get and the premium that you would need to pay. Insurance agents typically refer to an insurance score that is based on your credit score with certain other factors. If you have a low credit score, you will have to pay some extra premium every year but with a good credit score, you can pay a comparatively lower premium.
How Can I Improve My Credit Score?
The following sections should make it abundantly clear that maintaining a good credit score is imperative if you wish to satisfy your financial requirements. Clix Capital recommends the following actions for you to undertake if you’re aiming to increase your credit score.
- Regular payments are a must. Regardless of what your dues might be – credit card bills, loan EMIs, or anything else along the same lines – make sure that you never default on your payments.
- Manage your credit wisely. Plan out your finances and take loans accordingly. Being careless when it comes to taking loans and issuing credit cards won’t just be bad for your credit score – it’ll also prove to be highly detrimental for your financial status in the long run.
- Make it a habit to track your credit score regularly. This will help you map out your credit behaviour, identify any problems that might be negatively affecting the same, and get any mistakes corrected if they arise.
- Keep your credit utilisation ratio in control. Exceeding 30%-40% of the limit on your credit card is not recommended. It’s also important to avoid having multiple outstanding unsecured loans or credit cards.
How Do I Interpret My Credit Report?
At a glance, your credit report might seem somewhat overbearing. To make the task of analysing this report easier, Clix Capital has provided a section-wise breakdown of what’s present in this report and what you need to focus on.
- Personal Information: This section of the credit report contains information pertaining to your identity. This includes the person’s name, address, current and previous accounts, and date of birth, among other such details. It’s important to check this section for any errors so that you can report this to the credit rating agency and prevent the possibilities of credit fraud.
- Account Information: This section will contain information about your past and present credit account. It includes the following details:
- Opening Date
- Creditor Name
- Current Balance
- Credit Limit
- Monthly Payment History
- Account Type (Instalment, Revolving, Open)
- Account Ownership (Individual Or Joint)
- Payment Status
- Public Records: This section of the Credit Report will file bankruptcies presented by the individual, along with tax liens availed by the individual or collection accounts. The dates offered in this section should be reviewed as they will inevitably the time period for which they will appear on an individual’s credit report and impact the final credit score.
- Inquiries: This section contains data relating to any requests made by companies in relation to an individual’s credit score. If an individual applies for multiple lines of credit, this could impact his/her score in a negative way. Commonly, inquiries do not impact a person’s credit score, as they are soft inquiries by lenders for promotional purposes. A soft inquiry is formed when the request for the credit report is not pertaining to the individual’s request for credit.
How Do I Compute My Credit Score?
Clix Capital has teamed up with Experian to provide you with an excellent way to measure your credit score. Just follow the steps mentioned below and you’re all set!
- Fill out the form present on the website. You’ll need to submit the following details:
- Full Name
- Date Of Birth
- PAN Number
- Pin Code
- Email Address
- Mobile Number
- Once you click on the “Get Your Credit Score” button, you’ll be asked to verify
- your mobile number via an OTP.
- While your score is being fetched, you’ll be asked to state your occupation type, employer name, and monthly income as well.
- After accomplishing all these steps, you’ll receive your credit score. It’s really that easy!
What is a credit score, and how is it calculated?
A credit score is a 3-digit number that indicates an individual’s creditworthiness. Credit bureaus calculate it based on an individual’s repayment history, past credit behaviour, portfolio diversity, Debt-To-Income ratio, and other parameters.
How do I check my credit score?
You can use our Free credit score checker on the website or click here to know it.
Is a PAN card mandatory for credit score?
Yes. The PAN card is government-generated ID credit bureaus use to keep each individual’s credit history and records. So, a PAN card is mandatory for a credit score.
How many credit score bureaus are there in India?
India has four credit score bureaus: Experian, TransUnion CIBIL, CRIF Highmark, and Equifax.
What's the credit score by Experian?
There are four credit bureaus in India, each calculating the individuals’ credit scores differently. Experian credit score means that Experian India has calculated the credit score. It helps to assess the creditworthiness of the applicant.
What are the differences between Experian and CIBIL credit scores?
Both Experian and CIBIL scores are credit scores used by loan providers to assess the creditworthiness of the applicant. Experian India calculates the Experian credit score, and TransUnion CIBIL calculates the CIBIL credit score.
Experian uses the FIFO algorithm for credit scoring purposes. It terms the mechanism employed as FICO or FICO II. CIBIL, on the other hand, uses the model named Empirica. Experian is older than CIBIL, and has existed since 1996.
What is the minimum credit score required for a Personal Loan?
The credit score ranges from 300 to 900. An Experian credit score above 630 is decent enough to obtain a Personal Loan.
Does continuously checking credit score reduces it?
No. Checking the credit score does not reduce it. Experts suggest checking it regularly to stay updated and act on time.
Why do lending institutions check your credit score before approving your loan?
Lending institutions give utmost importance to credit score because it indicates an applicant’s repayment habits and credit behaviour. It helps them asses the risks related to the borrower. Those who have handled credit responsibly in the past have a high chance that they will continue doing so.
Is it beneficial to have a high credit score?
Yes. A higher credit score will help you get the lowest interest rates on loans, higher loan amounts, and more favourable terms and conditions.
How do you get an 800 credit score?
An individual may achieve a credit score of 800 by paying all their EMIs and credit card bills on time, diversifying the credit portfolio, retaining old accounts, and maintaining a low Debt-To-Income ratio.
Does credit score affect my chances of getting a new loan or credit card?
Yes. Those with a high credit score have higher chances of getting a new loan or credit card with better terms and conditions.
How do I increase my credit score?
Clearing all loan EMIs and credit card bills on time, maintaining a low debt-to-income and credit utilisation rate, diversifying the portfolio with different loan types, and retaining old accounts to prolong credit history are effective ways to increase the credit score.
Does Clix Capital accept CIBIL or Experian credit scores?
Clix Capital accepts Experian scores for Personal Loans and CIBIL scores for Business Loans.
What is the maximum credit score required to get Business Loans from Clix Capital?
An applicant must have a CIBIL credit score of 700 or above to get a Business Loan from Clix Capital. A CMR score of up to 7 is also required for the business to qualify.
What minimum credit score is required to get Personal Loans from Clix Capital?
An applicant must have an Experian credit score of 630 or above to get a Personal Loan from Clix Capital.
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