Home Bank Loan Widespread Myths About CIBIL Rating

Widespread Myths About CIBIL Rating

Widespread Myths About CIBIL Rating


CIBIL (Credit Information Bureau (India) Limited) is a credit information company that maintains records of an individual’s credit history, including credit cards, personal loans, and home loans. A CIBIL score is a three-digit number that ranges from 300 to 900, and it is used by banks and financial institutions to determine an individual’s creditworthiness. 

However, there are several myths surrounding CIBIL scores that can be misleading. In this blog post, we will debunk the most common CIBIL score myths that you may have believed were true. 

Only those who have taken a loan have a CIBIL score

This is not true. Everyone who has ever applied for a credit card, loan, or even a mobile phone connection has a CIBIL score. Even if you have never taken a loan, you can still have a CIBIL score if you have ever applied for a credit card. 

A high CIBIL score guarantees loan approval

A high CIBIL score is a positive indicator of creditworthiness, but it does not guarantee loan approval. Banks and financial institutions take several factors into consideration when approving a loan, including income, employment, and other financial obligations. 

A low CIBIL score means you will never be able to get a loan

A low CIBIL score can make it more difficult to get a loan, but it is not impossible. Banks and financial institutions may offer loans at higher interest rates or with stricter terms and conditions. It is also possible to improve your CIBIL score over time by making timely payments and reducing outstanding debts. 

Paying your credit card bill late will not affect your CIBIL score

Late payments can have a significant impact on your CIBIL score. Every time you miss a payment, it is reported to CIBIL, and it can lower your score. It is important to make sure that you pay your credit card bill on time to maintain a good CIBIL score. 

Closing a credit card account will improve your CIBIL score

Closing a credit card account may seem like a good idea to reduce your outstanding debts, but it can actually have the opposite effect on your CIBIL score. Closing an account can lower your credit utilization ratio and shorten your credit history, both of which can negatively impact your CIBIL score. 

Checking your CIBIL score frequently will lower it

Checking your own CIBIL score will not lower it. In fact, it is recommended that you check your score regularly to ensure that it is accurate and to identify any errors that may be affecting your score. 

A co-signer can improve your CIBIL score

A co-signer can help you get a loan, but it will not improve your CIBIL score. A co-signer is simply a person who guarantees to repay the loan if you are unable to do so. The loan will be reported to CIBIL in your name, and it will have the same impact on your score whether you have a co-signer or not. 

Paying off a loan early will lower your CIBIL score

Paying off a loan early will not lower your CIBIL score. In fact, it can have a positive impact on your score, as it shows that you are financially responsible and able to manage your debts. 

A personal loan will lower your CIBIL score

A personal loan can have a positive impact on your CIBIL score, as long as you make the payments on time. Personal loans can help to improve your credit utilization ratio and show that you are able to manage multiple types of credit.

Your CIBIL score is not important if you have no plans to take a loan

A good CIBIL score is important for various financial decisions such as applying for a credit card, renting an apartment, and even getting a job.


It is important to understand the facts about CIBIL scores, so you can make informed decisions about your credit and finances. By dispelling these myths, you can work towards improving your score and achieving your financial goals.



Please enter your comment!
Please enter your name here