October 1, 2024 · 20 mins read
Santosh Kumar
The importance of your CIBIL score cannot be overstated since it shapes your economic prospects, especially concerning loans, credit cards, and other related financial products. Challenges such as loan denial or a high interest rate when one's score is as low as 600 limit one's chances of getting good credit terms. But, there is good news: achieving this score is possible, and with grit and a well-coordinated plan, you can take your CIBIL score to 750 – a score with which one can borrow affordably.
A 600 score is often attributed to late payments, high debt balances, lack of an established credit profile, low credit limits, and balance volatility. However, these factors can be corrected over a definite period. Treat your finances professionally, and up to certain score levels, you can build it steadily.
The blog explains each point clearly on how to increase CIBIL score from 600 to 750. Treat your finances with respect from this day on, and not only will your credit reputation grow, but you will also be able to enjoy more favourable credit terms and improved loans.
The most important practice when it comes to your CIBIL score is understanding why people often look for their credit reports. This is a very useful and positive aspect, but one must always bear in mind that a few minor mistakes, including wrong addresses, amounts due on loans, and even some dues that have never been skipped, are enough to spoil what could have been a perfect score.
1. The official site of CIBIL can be accessed.
2. If not, you must sign up for a MyCIBIL account. Logging in will also enable you.
3. To explain, you can access your report as a CIBIL member once every calendar year and once every quarter on a monthly subscription – clearly not necessary.
4. When reviewing the report, it is important to focus on the credit accounts, repayment history, and inquiries and look for any errors, such as accounts created in error, incorrect repayment schedules, or payments that were reported as missed, although they were completed.
Timely repayment of credit card bills and loan EMIs is critical if you want to improve your CIBIL score. Payment history is weighted and accounts for 35% of a person's credit score. People miss due payments or make delayed payments, which adversely affects their scores. Thus, it is a factor to be considered when marketing oneself.
Here's how you can ensure you never miss a payment:
Use apps or calendar alerts to set reminders for all your bill due dates. This will encourage customers to make their upcoming payments.
You might want to register for automatic payments for additional safety and comfort. This way, all your payments will be made on time every month without you having to make an effort to do them manually.
Always make sure you pay off the highest-interest debt first. The situation will only get worse over time at high prepaid credit cards that frequently accrue high rates and fees. Such high debts add up to the credit utilization ratio, which can negatively impact the score.
If you cannot settle the balance in full, be sure to make the minimum required payment to avoid any late payment charges and damage to your credit rating. Supplying at least the minimum payment consistently is sufficient to assure the financiers of your creditworthiness had the need and reasons arise.
Over time, steady and timely repayments will gradually improve your payment history, which in turn improves your CIBIL score. Therefore, this method of repayment improves your credit profile and your chances of maintaining goodwill over the long term.
Read More:: How Much Cibil Score is Good? Find Out Now!
Timely repayment of credit card bills and loan EMIs is critical if you want to improve your CIBIL score. Payment history is weighted and accounts for 35% of a person's credit score. People miss due payments or make delayed payments, which adversely affects their score. Thus, it is a factor to be considered when marketing oneself.
Here's how you can ensure you never miss a payment:
1. Use apps or calendar alerts to set reminders for all your bill due dates. This will encourage customers to make their upcoming payments.
2. You might want to register for automatic payments for additional safety and comfort. This way, your payments will be made on time every month without you having to manually make them.
3. Always make sure you pay off the highest-interest debt first. The situation will only get worse over time at high prepaid credit cards that frequently accrue high rates and fees. Such high debts add up to the credit utilization ratio, negatively impacting the score.
4. If you are unable to settle the balance in full, be sure to make the minimum required payment to avoid any late payment charges and damage to your credit rating. Supplying at least the minimum payment consistently is sufficient to assure the financiers of your creditworthiness had the need and reasons arise.
5. Over time, steady and timely repayments will gradually improve your payment history, which in turn improves your CIBIL score. Therefore, this method of repayment improves your credit profile and your chances of maintaining goodwill over the long term.
Read More:: How to Improve CIBIL Score after Default
Whether a consumer applies for a loan or a credit card, the lender makes a hard inquiry about their credit in each application. When making applications for loans and deposits, it is best to spread them out both time and number to improve your CIBIL score. If you have too many inquiries at one point, it may show that you are about to go figure.
Here’s what you can do to lower the significance of such inquiries:
1. To avoid the burden of concentration, apply for various credits or loans at regular intervals. When applying for new debts, it is advisable to do so after a long period and not more than two types of credits or loans.
2. First, try to get a loan at a rate that is pre-approved for your application since no hard inquiry will be made in this circumstance.
3. Conduct an assessment of your ability to obtain the loan before beginning the process to limit the amount of wasted inquiries that would have detrimental implications on your present score. Therefore, they will assist in maintaining good scores or improving them.
Read More:: How to File a Complaint for Your CIBIL Score- Step-by-Step Guide
The period during which your credit history has been active is the second most important contributor to creditworthiness, also known as the CIBIL score. Creditors want to see that they are dealing with clients who have a deeper understanding of credit. It is essential to understand that closing most old credit accounts can also hurt the average account age and, as such, affect the overall score.
This is what you have to do about your credit age:
1. You don’t need to close your old credit cards, even though you don’t use them anymore. Such accounts are favourable as they increase your credit history.
2. Do not apply for several new accounts in a very short period. This will shorten the mean credit age, which may adversely impact the score.
3. It is possible to enhance the age of the credit history and subsequently increase the score by maintaining old accounts while being restrained from opening new ones.
A mix of credit types is also quite appealing to lenders. In this regard, there are secured loans like home loans and auto loans, as well as unsecured loans such as credit cards and personal loans. It is worth mentioning that not all types of credits affect one's CIBIL score positively. For example, heavy credit users who fail to maintain their payment schedule are at a higher risk of defaulting.
To achieve balance, credit diversity must be observed:
1. When you only have unsecured loans like credit cards, consider getting a small secured loan like a gold loan or home loan.
2. On the other hand, if your existing debts are mostly secured loans, responsibly using a credit card will be an effective means of enhancing your abilities.
3. Be cautious about applying for multiple loans simply to enhance your mix; this may backfire by increasing your debt liability.
4. Over time, a good mix of borrowed funds will also improve your score as you can demonstrate to credit institutions that you can manage various types of credit.
Read More:: How A High CIBIL Score Can Slash Your Interest Rates
If borrowers have debts marked as settled or written off on their credit reports, they face serious issues with their CIBIL score. In such situations, it is advisable to contact lenders and strike a bargain for the debts.
The following steps are undertaken in dealing with the outstanding amount:
1. Call the lender and propose a settlement or pay the entire outstanding amount.
2. When no dues remain, apply for a no-objection certificate (NOC) from the lending institution confirming the loan's closure.
3. Provide CIBIL with the NOC to revoke your report's settled or written-off status.
4. This improves the CIBIL score, which is greatly indicative of the borrower's credibility when one clears the outstanding debt and updates the CIBIL credit report with positive statuses.
Read More:: How To Read Your Credit Report
It is important to note that improving your score doesn't happen overnight. The gradually process with consistent discipline can take 6 to 18 months, relying on how you handle finance.
3–6 Months: The initial positive changes and small increase to your score are likely to happen if you perfectly pay all of your bills on time, maintain your credit utilization below 30%, and refrain from initiating new hard inquiries into your credit.
6–12 Months: You will see steady upward progression towards your score as you pay down outstanding debt, maintain a mix of secured and unsecured credit to diversify your credit profile, and maintain a healthy payment history.
12–18 Months: A score of 750 becomes a strong possibility if you continue to pay off balances, maintain low credit utilization and do not close your old accounts that contribute to your credit age.
Missing Due Dates - Just one late EMI or credit card bill can decrease your score by as much as 50 to 100 points. The best way to prevent this from happening is to automate your payments.
Overutilizing Credit - Using most of your credit cards indicates poor financial management on your part. You should always aim to use less than 30% of your credit limit using all credit cards when possible.
Closing Older Credit Accounts - Many borrowers will close their old cards after they have paid off their loans. However, old accounts contribute to your "credit age," which is a factor in CIBIL scoring. Closing an account, especially one that is quite old, could reduce your score when calculating credit age.
Applying for Multiple Loans at Once - Each loan application returns a hard inquiry that eaffects your score by lowering it. Applying for multiple loans that are each rejected only makes it worse at each rejection.
Ignoring Errors in Reports - Often, it may not be anything you did; it may just be an incorrect entry. If you don't dispute an account that you know is in error, your credit score will remain unfairly depressed.
You should track your credit score regularly, as this allows you to spot improvements over time and discover any errors that may be affecting your score early on.
Free reports are available from credit bureaus: You are entitled to receive one free CIBIL report from the bureau a year in India.
Banking Apps: Most of the banks and NBFCs (Non-Banking Financial Companies) will send you a free score update monthly or quarterly under their digital platforms.
Fintech Apps: Fintech platforms such as Paisabazaar, BankBazaar, and CreditMantri will allow free access to your score, plus provide alerts if there are any changes.
Paid Subscriptions: Paid subscription services offer more sophisticated features, such as a score simulator that indicates how a specific action (e.g. repaying ₹50,000 in debt) will impact your score or how your score will be impacted if late on a payment.
A CIBIL score of 600 is classified as below average and it can be hard to obtain loans or credit cards at a good interest rate. If you are wondering how to increase CIBIL score from 600 to 750, the first thing you will need to do is figure out what went wrong. You should obtain your most recent CIBIL report, and look for missed payments, a lack of credit history, too much credit usage, loans that you have recently enquired about taking, and other factors.
Start with your payment history, and create a positive repayment history, as it is the most significant factor impacting your score. Ensure you pay your emergency installments (EMI) and credit card bills on time. Since your CIBIL score is 600, you may want to set payment reminders or most simply change your payment method to auto-debit. If your card usage is high, it would be best to aim for your credit utilization to remain below 30%. High utilization shows financial distress, and remains the largest hurdle in how to improve CIBIL score from 600 to 750.
You'll want to avoid applying for too many loans or credit cards within a short period of time because every hard enquiry is going to further reduce your score for a short period of time. If needed, you could take a small secured loan - for example a loan against an FD - to show that you can repay responsibly. Lastly, ensure that you check your report and inquire about any items that can be disputed because they are incorrect or old. Just disputing errors can help ai greatly, as you may be looking at how to increase CIBIL score from 600 to 750.
Achieving a credit score of 750 and above places you in a solid financial situation. You are likely to receive loan offers with favourable interest rates and instant approval. However, to maintain this score, you must work hard to keep it there. Many people focus on how to raise their CIBIL score from 600 but maintaining a high score is also important.
To keep your score stable, please try to refrain from missing your EMI or credit card bill payments. A single missed payment can reduce a high score. Note your credit utilisation percentage, especially if you frequently use your cards; the lower, the better. The prudent use of credit will be recognised by lenders if you keep your utilisation percentage under 30%.
Avoid applying for new credit unless necessary, as too many applications will erode your score and standing in the eyes of the creditor. Having as many old credit accounts open as possible is also beneficial, as the length of repayment history is a good sign of trustworthiness. Look to your credit report regularly for error or unrecognised activity; fairly promptly being reconciled helps keep your score marginally above 750.
Your score will suffer tremendously if you were to miss or delay payments. To remedy this, make sure your payments never arrive after the due date; it is also best practice to automate your EMI or card payments.
If your total credit limit is exceeded, this could lower your score. Utilize less than 30% of the total credit limit by either lowering expenses or requesting a credit limit increase with your bank.
A blend of secured or unsecured loans would improve your score. In case your credit profile simply includes credit cards, you might address this with a small secured loan in order to generate more stable credit over time.
Older accounts would help develop a strong score. You should not close your oldest cards, especially if payments are clear.
When applying for too many loans or cards, you will be creating hard inquiries against your credit report if you are denied for credit. Inquiries damage your score so it would be best to space out these applications; especially if you are trying to improve CIBIL score from 600 to 750.
Accounts that do not belong to you, revert at a far slower pace, or settlement for accounts appear more than once can negatively impact your score. Be sure to download your report regularly, and quickly raise disputes with CIBIL for payments that are incorrect.
So, how to increase CIBIL score from 650 to 750? We can increase a CIBIL score from 600 to 750 in months with some strategy and discipline. If you watch your credit report and look for mistakes, make payments before the due date, keep your credit utilization low, or have different types of credit, you can boost your score over time and get better financial deals.
Time is of the essence. It takes time to improve one's credit score, but every slight improvement you make to your score will be helpful to you in one way or another. Upon achieving a score of 750, one will have better options in terms of credit and loans, more so low-interest rates geographies, and fewer restrictions than before.
You have taken the first steps of achieving and maintaining a good CIBIL score by following these guidelines responsibly.
Yes, but it depends on the specific issues affecting your score. Well, some factors, especially in the short run or period, can help raise your score quickly. Some of them are correcting anomalies in your report, reducing your credit utilization ratio, and even settling outstanding debts.
It is advisable to check it at least once a year and also before borrowing money through a loan or credit card. This prevents mistakes and misuse of one's credit.
Paying off debts favourably impacts your score, but it depends on time, credit utilization, payment behaviour, and many other factors.
The average age of closed accounts goes down, which is bad for the score. However, it is advisable to close old accounts with old account histories because they may have a good repayment history.
Proper credit card usage, such as paying off outstanding balances in a timely manner and keeping the credit used low, manages to strike a balance and raise one's score over time.
Not really. You might see a slight (10–30 points) increase if you pay down any overdue balances or settle a mistake, but to reach the score of 750, you will need to be consistent for several months.
You can initiate a dispute directly on the CIBIL website by filling out a dispute form and submitting supporting documentation. CIBIL then initiates contact with the affected bank, and most disputes are resolved within 30–45 days.
Yes, when you close a card, you potentially decrease your overall available credit, which can have an impact on your utilisation ratio. You are also reducing the average age of your accounts. Unless that card is subject to high fees, it may be more beneficial to simply keep it active but make occasional small charges or spends.
No. When you receive a pre-approved offer on your credit card, it uses a soft inquiry which does not impact your CIBIL score. Only hard inquiries, which occur when you formally apply for a loan or credit card, will cause a temporary dip in your score.
Generally, you can expect it to take 6-12 months to enhance your score from 600 to 750. However, it entirely depends on your repayment behaviour, utilisation ratio, and whether you have any historical defaults. If you develop a consistent pattern of financially responsible behaviour, you will be able to improve the score quicker than long-term participants. This is a reasonable time frame for most people who are looking to enhance the CBO score from 600 to 750.
Definitely, you can improve your score without taking out a new loan. Just make sure that you make timely payments, equity finish reducing utilisation ratios, avoid any new lines of credit and make sure you fix any errors on your report to improve the overall score. These are very effective if you want to see how to improve CIBIL score of 600 to 750 without borrowing.
Continue to keep credit score utilisation ratios low, avoid late payments, and keep old credit lines open, and inspect your report regularly for inaccuracies. If you use your credit responsibly, avoid unnecessary borrowing, you can maintain your score consistently above 750.
Closing a credit card account could lower your score; this is especially true for any card that is either old, or has a high credit limit, because it will shorten your credit history and increase your utilisation ratio. If the card has no annual fee and you have a history of timely payments the prudent alternative is to leave it opened.
Build and Maintain a 750+ Credit Score
