CIVIL Report – A summary of your financial standing

The Reserve Bank of India (RBI), in 2017, instructed all Credit Information Companies (CIC) or CIBIL Report generating companies to provide a free full credit report in digital/electronic form anytime during the calendar year. The report will be provided on request and due verification on the authenticity of the customer whose credit data is stored by the CIC. A CIBIL report generated for individuals is also known as a credit information report (CIR), while that generated for companies is called Company Credit Report (CCR)

Though CIBIL empowers you to build your credit report, they aren’t so easy to understand. It is a detailed and comprehensive document with details of secured/unsecured loans, overdraft facilities, credit cards, EMIs, etc. The three-digit credit scores are the summary of your credit history and are obtained based on what exists in your credit report.  

How the CIBIL Report Works?

Banks, credit card companies, non-banking finance companies (NBFC), and housing finance companies and financial institutions that are clients of CIBIL, report each of their customers’ actions to it which then generates your credit report. It then provides these reports to the banks/financial institutions when they come up with pre-approved loans or you apply for a loan.

Every month Civil looks out for people who may have skipped a loan payment or missed the deadline or have defaulted in any which ways and prints it in the report.  Civil reports help credit institutions to check your three points of credit – leverage, risk appetite and behaviour. Let’s check them out in detail

1. Credit leverage: It is the debt or borrowing of funds to finance your needs, develop good spending habits and to maintain a good credit score. Higher credit scores lead to more wealth generation and you are required to pay less for the loans.
2. Credit behaviour: Your civil reflects your credit behaviour in the past with regards to your credit repayment. It keeps a track of the timely loan payments of EMIs if you have ever made settlements on credit card bills, ever defaulted and by the number of days, etc.
3. Risk appetite: Risk appetite or credit risk appetite is the level of danger that a bank is prepared to take while giving credit to you. It considers the type(s) of loan you have availed, the composition of secured and unsecured credit, etc.

Knowing the nuances of the civil report helps you assess your financial health, get you good deals on loans and also impact your employment. It also helps you spot discrepancies, if any, and understand what the problems areas are so that you can work on them.

Log on to https://civilscores.com/ for more information on civil scores and more.