Review your credit score before hunting for loans
How do borrowers and lenders use information from a credit bureau and how does it serve their purpose?
In today’s scenario, both borrowers and lenders are aware of the functioning of a credit bureau and the benefits associated with it. The increased usage of Cibil credit information reports and Cibil TransUnion Scores by credit grantors during loan disbursement has showcased a growing trend. Credit grantors are experiencing benefits associated with the usage of Cibil score for reliable credit decisions and individuals are approaching us before they apply for credit to know their credit standing, which will help them improve their credit history and avail credit on better terms. We encourages consumers to maintain greater self discipline in meeting financial commitments by allowing them to build reputational collateral through appropriate repayment behaviour.
How would a lender set the price if there is no objective credit information of the borrower?
Without objective credit information, lenders set prices according to average risk levels or use subjective, less precise methods of evaluation. This results in products that are excessively expensive for low-risk consumers and unfairly inexpensive for high-risk consumers. By making the costs of extending credit lower, credit information enables lenders to extend
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