Keeping a track on your CIBIL report is as important as keeping a track on your physical health condition. While there are four credit bureaus in India, the CIBIL report is the most widely known. It is an important document about your personal financial history that determine your creditworthiness. While maintaining financial discipline and making all your bill payments and EMI payments before due date is an essential way to maintain a good credit score. You should not just assume that doing so will ensure that your credit score is good. There can be multiple reasons why your credit report may still be having a low score or not creating the amount of positive impact that it should.
It is recommended that you should check your CIBIL report regularly. If you are planning to take a loan or any other credit facility soon, checking your credit bureau report becomes imperative.
Why is it important?
Check for any discrepancies in records:
First and foremost reason to keep a check on your credit report is to detect any wrong information that has got recorded. For example, a credit card company charged you Rs. 3000 for a service without your consent and received this additional amount on your next bill. You raised a complaint with the customer care and meanwhile your due date is approaching. Not to miss payment, you pay the bill (minus Rs.3000) because this amount is disputed. Later on credit company agrees to cancel the service and cancel the Rs.3000 charges. In this case, you assume everything has gone smoothly. But here’s the catch, on your due date, you paid Rs.3000 less than your due amount. This shows up as a partial payment record in your credit report. A couple of more such incidences and can seriously affect your credit score. Such discrepancies can be settled through the dispute resolution mechanism .
Check that all your open and closed accounts reflected correctly:
Again sometimes credit companies may not be sincere in reporting a closed account (completed loan payments, closed credit cards etc.) Checking your CIBIL report is necessary to track that your accounts are accurately being reported. Also, always remember to take a closure certificate from bank after you close an account.
Detect any frauds or identity thefts:
Mr.A was surprised to see a credit card account in his credit report which he was totally unaware of. Over and above, it seems only minimum payment due was being payed to avoid raising an alarm till so long as it was possible. It seems someone had used copies of his personal documents to take a credit card in his name and was happily using it. Such frauds are not very commonly heard off, but they are not rare at all. Many people have been duped of their life’s savings because of such identity thefts. Checking a credit report is one way of ensuring that you detect any such suspicious activity as soon as possible.