• GSR Financial Services

5 Smart Ways to Improve Your CIBIL Score

Why Your Credit Score Matters

A good CIBIL score (750+) unlocks lower interest rates, higher loan amounts, and faster approvals. In India, 79% of loans are rejected due to poor credit scores. Your score reflects your repayment behavior across credit cards, loans, and EMIs. Banks and NBFCs use this to assess risk before lending. The higher your score, the better deals you can negotiate.

Check Your Credit Report Regularly

Start by downloading your free CIBIL report annually from official bureaus. Look for errors like incorrect late payments, duplicate accounts, or outdated balances. Dispute inaccuracies immediately via the bureau’s website. In our experience, 40% of reports have resolvable errors that can boost scores by 50+ points. Set reminders to review your report quarterly.

Reduce Credit Utilization Ratio

Keep credit card usage below 30% of your limit. High utilization signals dependency on credit and lowers scores. For example, if your limit is ₹1 lakh, aim to spend under ₹30,000 monthly. Pay bills before the statement generation date to show lower utilization. Consider requesting limit increases (without spending more) to automatically improve this ratio.

Never Miss EMI Payments

Payment history contributes 35% to your score. Set up auto-debit for EMIs or calendar reminders. If you miss a payment, negotiate with the lender to avoid being reported to bureaus. For existing late payments, maintain perfect behavior for 6–12 months to offset past mistakes. Even one 90-day delay can drop your score by 100+ points.

Mix Credit Types Wisely

A healthy mix of secured (home/car loans) and unsecured (personal loans/credit cards) credit shows responsible handling of diverse products. However, avoid applying for multiple loans within short periods—each inquiry temporarily dings your score by 5–10 points. Space applications 6+ months apart for optimal results.