How to Increase the CIBIL Score?
If you are planning to take a loan or apply for a credit card, the first thing lenders look at is your CIBIL score. This three-digit number (ranging from 300 to 900) plays a very important role in deciding whether your application will be approved and at what interest rate.
A high CIBIL score (750 and above) shows that you are a responsible borrower, while a low score reduces your chances of getting credit easily. The good news is that your CIBIL score is not fixed forever—it can be improved with consistent good practices.
In this post, let’s explore in detail what affects your score, how you can improve it, and practical examples to understand better.
✅ What is a CIBIL Score?
CIBIL score is a credit score given by TransUnion CIBIL, one of India’s leading credit bureaus. It is calculated based on your credit history—how you have handled loans, credit cards, and other borrowings in the past.
Range of CIBIL Score:
750 – 900 → Excellent (easy loan approvals, lower interest)
700 – 749 → Good (loans approved but rates may vary)
650 – 699 → Average (lenders may hesitate or charge high interest)
550 – 649 → Poor (loan/credit card approval becomes difficult)
300 – 549 → Very Poor (high risk, very low chances of approval)
👉 Example: If you want a home loan of ₹30 lakh and your CIBIL score is 820, the bank may offer you an interest rate of 8.25%. But if your score is 630, the bank may either reject the loan or offer it at 10.5%, which makes a huge difference in the EMI.
✅ Factors That Affect Your CIBIL Score
Before learning how to improve it, you should know what impacts your score:
Payment History (35%) – Delayed EMIs or missed payments negatively affect your score.
Credit Utilization (30%) – High credit card usage compared to your limit lowers the score.
Length of Credit History (15%) – Longer and positive credit history helps.
Credit Mix (10%) – A mix of secured (home/car loan) and unsecured loans (credit card/personal loan) is better.
New Credit Enquiries (10%) – Too many loan/credit card applications in a short time lower your score.
✅ How to Increase the CIBIL Score?
Here are proven and practical ways to boost your score, explained in detail with examples.
1. Pay EMIs and Bills on Time
This is the golden rule. Even a single missed payment can stay on your report for years and pull your score down.
👉 Example: If your EMI is ₹12,000 and you miss it once, your score may drop by 50-100 points. That’s enough to change your status from “good” to “average.”
✅ Tips:
Use auto-debit facility for EMIs.
Pay your credit card bill in full, not just the minimum amount.
Set calendar reminders for due dates.
2. Keep Your Credit Utilization Ratio Low
Credit utilization means how much of your credit limit you use. Ideally, it should be below 30%.
👉 Example: If your credit card limit is ₹1,00,000, don’t use more than ₹30,000 every month. If you consistently spend ₹80,000–₹90,000, even if you repay on time, it signals financial dependency and lowers your score.
✅ Tips:
Distribute expenses across 2-3 cards.
Request your bank to increase your card limit if possible.
3. Avoid Multiple Loan Applications in a Short Period
Whenever you apply for a loan/credit card, the lender checks your CIBIL report (hard inquiry). Too many inquiries in a short time indicate financial stress.
👉 Example: If you apply for 5 credit cards in 2 months, your score may drop by 30–50 points.
✅ Tips:
Apply only when necessary.
Compare offers online before applying.
4. Maintain a Healthy Credit Mix
Having both secured loans (like home loan, gold loan, car loan) and unsecured loans (personal loan, credit cards) creates a balanced profile.
👉 Example:
Person A: Has only 3 credit cards (all unsecured).
Person B: Has 1 home loan + 1 credit card.
👉 Person B is considered less risky, so their score will likely be higher.
5. Do Not Close Old Credit Accounts
A long and positive credit history is good for your score. Closing old accounts reduces your average credit age.
👉 Example: If you had a credit card since 2010 and it has no negative history, keep it active with small transactions. Closing it will shorten your history and may reduce your score.
6. Check Your Credit Report Regularly
Errors or outdated information can harm your score. You are allowed one free credit report every year from CIBIL.
👉 Example: Suppose you repaid a loan in 2021, but it still shows as “active.” This wrong entry can reduce your score. In such cases, raise a dispute with CIBIL to correct it.
✅ Tip: Make it a habit to check your report at least twice a year.
7. Avoid Being a Guarantor Carelessly
When you become a guarantor for someone else’s loan, their repayment behavior also impacts your score.
👉 Example: If your friend defaults on a loan you guaranteed, your CIBIL score will also take a hit.
8. Increase Your Credit Limit Gradually
Higher credit limits (when used wisely) reduce your credit utilization percentage.
👉 Example: If your card limit is ₹50,000 and you spend ₹25,000, your utilization is 50%. If the bank increases the limit to ₹1,00,000, the same ₹25,000 spend means 25% utilization, which improves your score.
9. Avoid Settling Loans or Cards
If you “settle” a loan by paying less than what you owe, it is marked negatively in your credit history.
👉 Example: If you owe ₹1,00,000 and settle it for ₹60,000, your score will drop significantly. Lenders see this as a red flag.
10. Show Consistent and Responsible Behavior
Improving your CIBIL score is not an overnight process. It takes at least 6 to 12 months of disciplined behavior to see a significant rise.
✅ How Long Does It Take to Improve a CIBIL Score?
If your score is below 600 → It may take 12–18 months of disciplined effort.
If your score is 650–700 → You can reach 750+ within 6–9 months.
If your score is already 720–740 → Small adjustments (like reducing utilization) can push it above 750 in 3–6 months.
✅ Common Myths About CIBIL Score
❌ Myth 1: Checking my CIBIL score will reduce it.
✔ Truth: A soft inquiry (when you check your own score) has no impact. Only lender inquiries (hard inquiries) affect it.
❌ Myth 2: Paying only the minimum due on credit cards is fine.
✔ Truth: It reduces your score because interest keeps adding up, and it looks like you cannot manage full payments.
❌ Myth 3: I should close unused credit cards.
✔ Truth: Keeping old cards with zero balance actually helps by improving your credit age.
✅ FAQs on Improving CIBIL Score
Q1. Can I increase my CIBIL score in one month?
👉 Not drastically. Small improvements are possible, but a major jump usually takes 6–12 months.
Q2. What is a good CIBIL score for personal loans?
👉 750+ is excellent, but some banks approve loans at 700 too.
Q3. Is it possible to get a loan with a low CIBIL score?
👉 Yes, but interest rates will be higher. You may also need a guarantor or collateral.
Q4. Do salary and income affect CIBIL score?
👉 No. Your score is based only on credit history, not income. But income matters for loan eligibility.
Final Thoughts
Your CIBIL score is like your financial reputation. Just as trust takes time to build in personal life, your credit score also improves gradually with discipline and responsibility.
To summarize:
Pay all bills and EMIs on time.
Keep your credit card utilization under 30%.
Avoid too many loan applications.
Maintain a healthy mix of loans.
Check your credit report for errors regularly.
If you follow these simple habits, your score will definitely rise above 750, making it easier to get loans and credit cards with lower interest rates.
⭐ Remember: A good credit score is an asset—it saves you money and gives you financial freedom.
If you are struggling with a low CIBIL score or facing difficulties in getting a loan or credit card, don’t worry—you’re not alone.
Our team can guide you with personalized solutions to improve your credit health.
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