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How to Boost Your CIBIL Score from 360 to 800 in 1 Year_WC

5 min 21 Mar 2023
  • CIBIL Score - What's the Significance of This 3-Digit Number?
  • Reasons for Low CIBIL Score
  • Steps to Increase CIBIL Score from 360 to 800
  • How to Check Your CIBIL Score by Using Your PAN Card or Aadhar Card?

Most purchases done these days are on credit, especially major purchases, such as electronic items, cars, and homes. To make these purchases on credit, it is necessary to build a good credit score, so that the bank or the lending financial institution trusts the buyer and allows him/her to draw credit. 

Credit may be on fixed deposits, to begin with, or at a bank where the buyer has a salary account, over some time, upon maintaining a good credit score, the bank or the financial institution is likely to offer credit on its own, to the buyer. 

Each financial activity in the credit market is recorded under CIBIL records. A CIBIL report records your worthiness to repay the lender. The CIBIL score ranges from 300 to 900. If you are somewhat close to 900, suppose you hold a CIBIL score of 800, you are a good obligation holder. This means that you are likely to repay the credit that you draw from the lender.  

The score by and large relies upon your record of loan repayment. Whether you are a defaulter, how long have you kept up with credit accounts, and how you utilize your credit, are variables that influence your CIBIL score.  

Also Read: Does Applying for Credit Influence One’s Credit Score?

CIBIL Score - What's the Significance of this 3-Digit Number?

Credit Information Bureau (India) Limited or CIBIL, stays aware of the credit records of every individual. It records both borrowing and repayment. Individuals and businesses both have CIBIL records. These records are used by credit-giving agencies such as crediting associations and banks to cross-check on both individuals and businesses before giving a loan or credit.

In other words, the CIBIL score decides if the credit of an individual or a business should be upheld. Each bank or financial institution that gives out an advance or credit, checks this score and then decides if the individual or the organization is worthy of getting the credit. A low credit score, say a credit score of 360 is not likely to get a credit allowance from the bank or financial institution.

Reasons for Low CIBIL Score

There are various reasons which can lead to a low CIBIL score. CIBIL scores can fall if loan repayments are not done on time. Alternatively, delay in credit card payments can also lower the CIBIL score of an individual. Delays in repayment or non-repayment of EMIs are also recorded on the CIBIL records. These delays further reduce the FICO rating. Using more than 30% of your open credit can also adversely affect your CIBIL score. 

Steps to Increase CIBIL Score from 360 to 800

A credit score of 800 is considered a very good credit score. At this point, you know the significance of the FICO rating and would be considering the simple methods for improving your credit ratings. 

Following are the steps that can increase your CIBIL score if it is below 360: 

  • Lowering Credit Utilization Ratio: Endeavour to keep the big financial commitments on your credit card to the bare minimum. Try and pay up your credit card bill on time.  
  • Avoiding Closure of Older Accounts: Showing clear older accounts will improve your FICO ratings. Late payment information shows up on the records. For instance, the records will clearly show if the payments that were to be made were made 30, 60 or 90 days past the due date. The more time that elapses between repayments, the greater the impact on the scores.  
  • Improving Payment History: Here is what can be done to boost your payment history.  

Put payment schedules on your e-calendar or ledger. Postponing repayment even by 2 days will impact your credit history. In case you have any missed instalments, pay them now! 

In case you have an extremely short record, don't open a large number of accounts now. Opening several records simultaneously, within a short period looks dangerous. It also affects your typical record age.  

Make obligations which you can repay. In case your reimbursement commitments are looking problematic, meet an expert.  

Closing off old credit cards is a transient system utilized by a larger number of people to further develop their FICO rating. Do not do this. This substantially reduces the length of your record of loan repayment. 

  • Monitoring of credit reports: Like we monitor financial investments in the stock market, we must monitor our credit scores regularly. This not only gives us a monetary sense of our condition but also guarantees that we do not make non-viable credit requests. 
  • Multiple credit cards: Avoid getting several credit cards at the same time. 
  • Pay your EMIs on time: Do not delay repaying your EMI obligations. Paying on time increases your base worth and builds your CIBIL Score. 
  • Pay off your credit card balance by personal loans: In case you are defaulting on credit card repayments. It is wise to pay up your credit card bills by taking a personal loan. Personal loans often have a lower loan cost than credit cards. This will also help you reduce the amount you will be paying by regularly scheduled instalments. 

Also Read: How to Increase Your CIBIL Score Above 800? 

How to Check Your CIBIL Score by Using Your PAN Card or Aadhar Card 

You can check your CIBIL score by using your PAN card or Aadhar card, by following the given steps: 

Step 1: Open the official website of CIBIL, Equifax, Experian or CRIF Highmark 

Step 2: Click on the tab that says 'Get your credit assessment' or any similar tab 

Step 3: The majority of these sites will expect you to pick an instalment plan before you continue. You can pick a plan that suits you. 

Step 4: On the webpage page, you will be expected to enter your specifics. Your complete name (as given in your PAN card), your email address, mobile number, and anyone 'ID' number will need to be entered. Be careful that you enter the details correctly. 

Step 5: The ID document numbers which are valid are –PAN number, Driver’s License Number, Passport Number, Voter ID number, Aadhar card or Ration Card number. Keep in mind, these ID documents ought to be in your name.  

Step 6: When you enter this ID number, the credit authority checks the details and pulls up your credit report. 

Step 7: The report will be sent off to your enrolled email address. 

Final Words

Maintaining a good credit score is essential to having a good CIBIL report. To increase your credit score to 800, you must pay back your loan EMIs on time. You must pay your credit card instalments on time. A delay of even a few days can show up adversely on your CIBIL report. Constant monitoring is the key to understanding the current personal financial scenario of a person. It is unwise to open several accounts and/or get several credit cards in a short duration of time. This affects your repayment history and consequently your CIBIL score. 

If you maintain a good credit score when you are young, you continue to reap the benefits as you grow older, particularly when it comes to obtaining a Home Loan. A good credit score is a crucial factor in securing a favourable Home Loan, as it shows lenders that you are a reliable borrower who is likely to repay the loan on time. So, building and maintaining a good credit score can increase your chances of being approved for a Home Loan with a favourable interest rate and terms, making it easier to achieve your dream of homeownership. 

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