Transform your financial understanding by diving into our guide on credit scores, and learn how the Bajaj Finserv Credit Pass can be the game-changer you need for a smarter credit management approach.

You must have noticed that banks ask for your credit score whenever you apply for a loan or a credit card. This is because credit scores are a big deal in the world of finance and factor into all lending decisions. If you have ever wondered about your CIBIL Score, you are in the right place!

What is a CIBIL Score?

Let us begin by understanding what your CIBIL Score is. In simple terms, it is your credit score as calculated by India’s pioneer credit information company TransUnion CIBIL. Ranging between 300 and 900, your three-digit score is like a snapshot or summary of your credit history. What does that mean? Well, it tells lenders how responsible you have been in your financial behaviour and how good you are with money. A higher score of 750–900 suggests that you are a reliable borrower.

Components of CIBIL Score

So, what makes up your CIBIL Score? There are five key factors that contribute to the calculation of your CIBIL Score. These are:

• Payment history: This is like your track record. Paying your bills on time consistently to nurture your score. Missed payments and defaults negatively impact your score.
• Credit utilisation: This is about how much credit you are using compared to how much you have. The key is not to max out your credit cards. If you can, keep your credit use low (below 30%), and it is good for your score.
• Length of credit history: How long have you been using credit? The longer, the better. It shows you have got experience handling money.
• Credit enquiries: There are two types of credit enquiries: soft and hard. The first kind has zero impact on your credit score because it takes place when you peek at your credit score. The latter kind occurs when you apply for a new credit card or loan and a lender pulls up your credit report to assess your creditworthiness. This temporarily lowers your score, so you would be better off not applying for too many credit products within a short span.
• Credit mix: This is about having a diverse credit profile. Having different types, like credit cards and loans, can boost your score. It is like having different skills in your financial toolbox.

Why should you care about your CIBIL Score?

Your CIBIL Score is not just a number, it is pivotal to your financial future as a reflection of your financial health and responsibility. Here is why:

• Loan approval: As a sign of your creditworthiness, your score is a fundamental consideration during the decision-making process for lenders when you apply for credit. A higher score increases your chances of getting approved.
• Credit limit: Even the credit limit on your credit card is determined by your credit score. When you have a high CIBIL Score, lenders are more willing to trust you with higher credit limits and larger loan amounts.
• Interest rates: Lenders are more likely to offer you lower interest rates and other benefits like longer loan tenures when you have a solid CIBIL Score. A poor score might translate to higher interest rates and shorter tenures, increasing your financial burden.

Building creditworthiness with Bajaj Finserv Credit Pass

If you are wondering how to keep an eye on your score and build a robust credit profile, the Bajaj Finserv Credit Pass is your best bet!

This CIBIL-powered subscription can help you monitor and manage your credit health with complete ease. How does it work? This user-friendly service comes with numerous advantages:

• A real-time credit dashboard that offers a comprehensive overview of all your credit accounts in one place
• You can track the factors influencing your score, including upcoming payment deadlines and your credit utilisation
• Monitor your CIBIL Score updates on a monthly basis
• Predict the impact on your score before you apply for a credit product using the Credit Score Simulator tool
• Calculate your monthly commitments using the EMI Calculator tool
• Enjoy unlimited access to these benefits free of cost for your initial year when you sign up for the Credit Pass during the limited-time offer period

The Credit Pass is essential because it provides easy access to all your credit information at your fingertips and equips you with the tools you need to plan your money moves with confidence. So, what are you waiting for? Register today and start keeping an eye on your score and improving your financial health!