Credit score | Key reasons for the fall and how to check it on Whatsapp for free

CIBIL, or credit score, is a key benchmark for understanding an individual's loan credibility for financial institutions in India. The CIBIL score is measured between 300 and 900 and calculated by credit information companies in India. A CIBIL score above 750 is considered an excellent score, while a score between 650 to 750 is deemed average and below 650 is a poor score.

Experian India, the first credit bureau to be licensed in India under the Credit Information Companies (Regulation) Act, 2005, has announced a service that allows Indian consumers to check their credit scores on WhatsApp for free. Hence, consumers can now check their Experian credit reports regularly and monitor their credit portfolio easily.

"The initiative introduces a quick, secure, and convenient way to access one’s Experian credit report anywhere, anytime. Consumers can check their Experian credit report, track any irregularities, detect fraud immediately and rebuild their credit score, enabling them to gain control of their credit profile," Experian India said in a statement.

With India having the largest number of WhatsApp users worldwide – at 487.5 million users – the WhatsApp messaging service is part and parcel of everyday life for Indian consumers.

Step 1: Send ‘Hey’ to Experian India’s WhatsApp number +91-9920035444 or visit: https://wa.me/message/LBKHANJQNOUKF1

Step 2: OR Scan Barcode

Step 3: Share a few basic details, such as name, e-mail ID, and phone number

Step 4: Receive Experian credit score via WhatsApp instantly. One can request a password-protected copy of the Experian credit report, which will be sent to the registered e-mail ID.

The credit utilisation ratio is an important factor that affects credit scores. It only considers one’s revolving credit, i.e., the credit card. If the utilisation becomes too high, it will impact the credit score negatively, even if balances are paid on time.

The other scenario wherein a sudden credit score drop may occur is when a person has applied for a new loan. Lenders often pull a hard report on credit scores when individuals apply for a new loan.

Another common factor for the fall is when a borrower misses paying a loan Equated Monthly Installment (EMI). This has an immediate negative effect on the credit score since repayment history is one of the most crucial factors determining a person’s score.

Another interesting scenario wherein the score may drop is when an existing credit card is closed, especially one that has been used for a long time. Since credit history accounts for most of one’s credit score, maintaining an extended history is necessary for a higher credit score.

Pre-pay the debts before the loan term finishes if cash flow permits it. This would not only save money on a potential monthly interest, but it would also help individuals in improving their credit scores. Also, users should try not to “max out” the revolving credit lines, such as credit cards, and use the limit wisely.