How a simple check civil score could help you establish a business?

Are you one of those fretting over losing the job during the Novel Coronavirus crisis? Then how about having your own set-up wherein no one can terminate your services and at the same time you can hand you’re your children with a legacy of sorts. 

Yes, we are talking about starting your very own business. We assure you that this is the right time to do something you have always dreamt about, but never gave it a serious thought. And the first step towards it is to check civil score to see where you stand financially, how much money would you need to start the dream project and to assess your chances of negotiating the Equated Monthly Installment (EMI) tenures and their interest rates.

There is a long list of things that matter to the credit history, but if certain major factors are taken care of, you will have an upper hand with the lenders. Let’s check them out.

1. Preferably skip moratorium: In these difficult times, it could be difficult to pay the bills. The Reserve Bank of India (RBI) has extended the facility of moratorium as a relief to the borrowers. But if you are trying to set-up businesses, it is always advisable not to opt for the facility. This is because the lenders prefer an updated credit history and opting for a moratorium would indicate an unstable payment capacity apart and even the credit report would not be updated till the time the moratorium period is complete.
2. Try paying twice a month: The pandemic has hit us all so hard that it has become very difficult to keep paying the bills. But instead of paying it all in one go, splitting the bills and paying twice a month is a good idea. This strategy will help you maintain the balance to a minimal. It will also save you from paying a high interest rate on the balance and ensure the credit utilisation limit is never exceeded. This limit impacts up to 30% of your credit score.
3. Avoid hard enquiries: Whenever a person applies for a new credit, a hard enquiry is initiated and this is the last thing you would like to have on your report when you are looking to steady your feet in business. This impacts the credit scores by 10% and, hence, if you are serious about taking a loan to establish a business in the future, then ensure that no hard enquiries take place and never forget to check civil score.
4. Pay off unsecured credit first: Those seeking credit to start a business must realise the importance of secured and unsecured loans in their portfolio. This is important for even those who need more credit to run their business because borrowers with more secured loans are preferred by lenders. 

So, what are you waiting for, check cibil score now.