Your credit score is a three-digit number, usually between 300 and 900, that tells lenders how reliably you repay borrowed money. In India it is calculated by credit bureaus such as CIBIL, Experian, Equifax and CRIF High Mark.
Why it matters
- A score of 750 or more is generally considered good and makes loan approval much easier.
- Better scores often qualify for lower interest rates. Even 0.5% less on a home loan can save lakhs.
- Premium credit cards and higher credit limits usually need a strong score.
What affects your score
| Factor | What helps | What hurts |
|---|---|---|
| Payment history | Paying every EMI and card bill on time | Late payments, defaults, settlements |
| Credit utilisation | Using less than about 30% of your card limit | Maxing out cards |
| Length of history | Keeping old accounts open | Closing your oldest card |
| Credit mix | A healthy mix of secured and unsecured credit | Only unsecured loans |
| New enquiries | Applying only when needed | Many loan or card applications in a short time |
How to check your score for free
You can get a free credit report from each bureau once a year on their websites, and many banks and finance apps show your score for free. Checking your own score is a “soft enquiry” and does not lower it.
How to improve your score
- Never miss a due date. Set up auto-debit for at least the minimum amount on cards and EMIs.
- Keep card usage low. If your limit is ₹1 lakh, try to keep your monthly balance under ₹30,000.
- Don't close old cards without a reason — they lengthen your history.
- Space out applications. Each hard enquiry can lower your score slightly.
- Check your report for errors and raise a dispute with the bureau if something is wrong.
- Starting from zero? A secured credit card against a fixed deposit is an easy way to build a history.
Scores usually improve within a few months of consistent on-time payments, but serious defaults can stay on your report for years.
Planning a loan? Estimate your EMI with the EMI calculator and compare offers with the loan comparison tool.