A CIBIL Score is a measure of the creditworthiness of an individual, in order to analyse the payback capacity of the borrowed amount. A CIBIL TransUnion score is a 3-digit number, anywhere from between a range of 300-900, with 900 being the highest. It represents your credit history. The higher the number i.e close to 900, the better the chances of an application getting accepted.
CIBIL Score is calculated in India based on several factors such as credit history and repayment behaviour. Your CIBIL TransUnion Score is calculated based on the information collected on you by the Credit bureau. The following key indicators considered in calculating CIBIL Score.
This includes the analysing the frequency of the repayment of debts obligation. It has the highest creditworthiness. Defaulting in this parameter will directly impact the loan application process. Its weightage is 30-35% in calculating the Credit Score.
The credit utilisation or how it would be used is imperative in considering the CIBIL Score. It accounts for 30% of total creditworthiness.
It comprises of a percentage of secured and unsecured loans in your credit portfolio with respect to the duration of your loan. It contributes to 25% of the creditworthiness.
The creditworthiness of this parameter is 15%. The parameter considers timely payments of the debt with respect to the timeline of the Credit.
The number of applications at a time decides also plays an important role in CIBIL Score. However, this parameter only contributes to around 10-15% of your creditworthiness.
Other factors include recent behaviour and character analysis also plays a vital role in determining the creditworthiness and has a contribution of around 20%.