A Cibil Score, three digit number that decides how responsible a person is in returning taken loan.Financial institutes use this three digit number to approve a loan or a credit card. Many people do not understand how important this number is.
Recently, the Reserve Bank of India has issued guidelines to make everyone understand. mainly for first time borrowers.
First-Time Borrowers Can Get Loans Without a CIBIL Score
Previously, banks only relied on cibil score to pass the loans. This made it difficult for first time borrowers to get their loan approved, because they did not have any credit history. RBI had mentioned now that first time applicants can not be rejected only because they do not have a credit score. RBI has not prescribed any minimum credit score for sanction of loan.
No Fixed Minimum CIBIL Score
RBI has not prescribed any minimum credit score for sanction of loan. Banks may have their own internal requirement for accepting loan applications but can not solely rely on cibil score.
Frequent Updates and Alerts
RBI has introduced new rules to make credit information more transparent to applicants. Now your cibil score will be updated every 15 days instead of month. These guidelines ensure the borrower stays informed.
Easy Error Correction and Compensation
RBI now requires all disputes to be settled within 30 days . If they fail to do so, borrowers will get ₹100 per day as compensation.
Easy Access to Credit Reports
RBI has made it easier to check their credit reports. One free online CIBIL report can requested.This will help payer to check credit score,
Conclusion
First-time borrowers no longer need to worry about not having a score, and all borrowers benefit from frequent updates, easy dispute resolution, and alerts.
FAQs
A CIBIL score is a three-digit number (ranging from 300 to 900) that shows how reliable a person is in repaying loans and credit card bills.
No, RBI has not fixed any minimum score. Banks may have their own criteria, but they cannot reject a loan only because of a low or missing score.
Yes. According to RBI rules, first-time borrowers cannot be denied a loan just because they don’t have a CIBIL score. Banks must check income and repayment ability too.
RBI has directed that CIBIL scores must be updated every 15 days, making it quicker for borrowers to see the effect of their repayments.
If there’s a mistake in your CIBIL report, the credit bureau must fix it within 30 days. If delayed, you may receive ₹100 per day as compensation until it’s corrected.