A CIBIL score is a credit score provided by the licensed credit bureau named TransUnion CIBIL. It assesses the creditworthiness of borrowers by different information that describes their credit history, including their borrowing habits, repayment patterns, outstanding loans, number of days past due, etc. The CIBIL score is a three-digit number which ranges from 300-900. The higher the number or score, the higher the creditworthiness of the individual.

If you want to know what your creditworthiness is, all you have to do is obtain your free CIBIL score online. The process takes just a few minutes, and you will receive the information regarding your credit history in your registered email address.

In this article, we answer the questions – What is the significance of CIBIL scores? What is a good CIBIL score? What determines CIBIL scores? Are CIBIL scores mandatory for loans? How to obtain free CIBIL scores?

What is the significance of CIBIL scores?

The unprecedented pandemic that stopped the world in its tracks and closed down businesses for months on end, caused a spike in borrowing. Small ticket loans are being availed now more than ever by the new generation to cover basic expenses in the light of the massive job losses. Having a good CIBIL score will ensure that loan applications are approved without much hassle. In addition to speeding up the process of availing loans, a good CIBIL score also helps borrowers get a lower rate of interest on the loans. Given this, it is important that a healthy CIBIL score is maintained.

What is a good CIBIL score?

A good CIBIL score ranges anywhere between 700-900. Anything below that will make it difficult to avail loans. This question is best answered in the form of the table below.

CIBIL Score Ranges Creditworthiness
750-900 Excellent
700-749 Good
650-699 Fair
600-649 Uncertain
300-600 Unreliable

What determines CIBIL scores?

The CIBIL score is calculated using an algorithm that takes into consideration multiple categories of information from the credit reports of individuals. Two of the most significant factors used to calculate your free CIBIL score include:

History of payments – The history of the payments made by the individual/potential borrower is first looked into. The number of times credits have been repaid before the due date, on the due date, after the due date, etc. is specifically looked into. In fact, if the CIBIL analysis into payment history reveals a delay in repayment of over 30 days, the CIBIL score is lowered by around 100 points.


A healthy ‘credit mix’ – A ‘credit mix’ refers to different forms of credit, i.e., while calculating the CIBIL score, the variety in the loans taken by the individual is looked into. For example, say an individual has taken out a home loan which is secured credit, and also makes purchases via credit card (unsecured credit), then, that is considered to be a healthy mix. Availing only one type of loan multiple times affects your CIBIL score negatively.

Are CIBIL scores mandatory for loans?

A CIBIL score is not mandatory to avail loans. Some institutions make CIBIL scores a pre-requisite for loan approvals, but this is not the case with every type of loan. Take for instance a gold loan, here the loan is taken out against the gold that is deposited with the financial institution as collateral. The gold is the assurance of payback that the lender has. Similarly, loans taken out on tax saving fixed deposits also come with an assurance of payback in the form of the FD corpus. In these scenarios, the creditworthiness of the borrower is not as significant, because the collateral is more than sufficient to cover the costs to be recovered from the borrower in case of non-payment.

How to obtain free CIBIL scores?

The RBI has made it mandatory for the licensed credit bureaus to allow individuals to receive a free credit report annually. You can get your free CIBIL score by following these simple steps.
  • Step 1: Visit the main CIBIL web address. This is a website that is a part of TransUnion, the licensed credit bureau that releases the CIBIL score.
  • Step 2: The landing page has an option ‘Get Your Free CIBIL Score’. Click on this to be taken to the registration portal.
  • Step 3: On the registration portal, enter the details as asked for. This includes your email address, name, mobile number, ID card type and number, pin code, etc. Here you also get to create a password for your CIBIL account.
  • Step 4: A verification email will be sent to your email ID. Once you verify the same, you can log in using the password you created in the previous step.
  • Step 5: Additional information, if any, regarding credit cards and loans will now be requested by the company.
  • Step 6: Once all the necessary information is provided, you will receive your free CIBIL score in your registered email address.
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