Credit gives the word to pay either by repaying it or returning those resources later. In other words, this credit is the method of making the reciprocity formal, legally enforceable, and of course, extensible to a vast group of people who are not related.
However, the resources provided may be financial or have goods or services, like consumer credit. The credit covers any form of deferred payment. Credit generally gets extended by the creditor, the debtor or lender, and sometimes the borrower.
Even when the term CIBIL score gets considered synonymous with the credit score, here an important considering aspect. CIBIL is one ofIndia four credit bureau companiesthat offer credit information. Any one of these companies offersa credit history. But a credit score only gets generated by the TransUnion CIBIL, and it known as the CIBIL score.
So, how is the credit score different from the CIBIL score? Concerning the wide popularity of TransUnion CIBIL, credit scores get referred to as the CIBIL score. It was formed in2000 by the group of financial institutions, Credit Information Bureau Limited or CIBIL. It got acquired by US-based TransUnion.
Depending on the user credit history, credit bureaus assign these scores:
CIBIL score: The score above 700 gets considered the no-risk zone for the institution. So, it means that the lender is willing to provide you with the loan at the lowest rates. Around 79% of loans get sanctioned to the borrowers with a high score, more than 750.
CIBIL score from 600 to 700: Lenders would wish to offer loans to individuals with a score in this range. It gets considered the less-risky zone.
CIBIL score from 300 to 600: An individual with a credit score is considered in the risky zone. Banks may shy away from funding people in this particular category.
CIBIL score from 1 to 5: The credit score gets assigned to people with less than sixmonths of credit history.
Score with -1: The credit score gets assigned to individuals with absolutely no credit history. The rating gets assigned to the first-time borrowers having no credit or loan in theirnames.
