How to increase your CIBIL Score?

How to increase your CIBIL Score?

CIBIL Score is a three-digit number that summarizes all your credit history. It ranges from 300 to 900 where any score above 750 is considered a good score. 

Having a good score helps you get a loan faster and easier with an interest rate that suits your pocket.

Increasing your CIBIL Score is much easier than it seems to be, but the plans may differ according to your credit history. 

According to the credit history, there are two types of people:

  1. People who do not have a credit history 
  2. People who do have a credit history 

You may want to check these as well: – What is the CIBIL score and How is it calculated? and How to check CIBIL Score for free?

Increasing CIBIL Score when you do not have a credit history

A person with no credit history will be shown an NH on his/her CIBIL Score if they decide to check. Now it is very easy to get a kick start to your credit life, here are a few tips that help you increase your CIBIL Score in no time.

1) Take a secured Credit Card: – There are two types of credit cards, secured and unsecured ones. Now secured credit cards do not allow any income proof moreover, they don’t even check for your CIBIL Score, all you need is a deposit. 

Many banks provide you with a secured credit card against an FD that you make with them. 

 2)Loan Applications: – Many different applications provide small loans without checking for your CIBIL Score or any income proof. Now if you pay these loans fully, you will see a healthy and instant increase in your CIBIL Score. 

Understand that even though these things do not check for your CIBIL Score, they do impact it. So, repayment of your secured credit cards or these small loans should be done full and on time. 

How to Increase Your CIBIL Score when have a Credit History?

Increasing your CIBIL Score when you do have a credit history is more about improving or maintaining your score. Now many things can be done for that but before we get into that, let us understand why our score drops?

Why does CIBIL Score drop?

There are a few factors upon which your CIBIL Score depends, these are as follows: 

  1. Past Performance; it has over 30% weightage over your CIBIL Score,
  2. Credit Mix and Duration has 25%,
  3. Leverage has 25%,
  4. And other Factors have around 20%.

Now there are a few things related to these factors that impact your CIBIL Score, these are

Default in loan repayment

If you are unable to repay your loan due to any reason, such as financial hardship or have missed a credit card payment or have been a victim of fraud etc, then your CIBIL Score drops rapidly within a few months.

For example, if your score was around 800 and you missed a credit card payment then within just a month or two your CIBIL Score can drop down to 650 or even more if the amount you missed is huge.

The high amount of unsecured debts

If you take a lot of unsecured debts like way too many credit cards or personal loans then you are getting yourself in big trouble. 

These debts are not backed by the back and thus have no security, if you miss any payment or just by having too many unsecured debts cause a dip in your score.


It is the percentage of credit limit that you use. Using too much of your credit limit in a short amount of time can cause a drop in your score.

 For example, if your credit limit is 70 lakhs and you use around 60-65 of it in just 2 months then the score will drop immediately.


If you apply for way too many loans or do a lot of enquires in a short period then it is considered a hard inquiry and thus causes a drop in your CIBIL Score.

Joint accounts or add on credit or being a guarantor

If you have a joint account or have an add the credit card or are a guarantor to someone or your company then your score gets affected even when you are not the one defaulting it. 

Inaccurate information on Credit reports

There have been instances where people find inaccurate information on their CIBIL or Credit report. 

 This can happen because of a few reasons such as incorrect open account, partial or full repayment of loan which isn’t getting reflected on the bank or settled loan which isn’t updated. 

Now that we know why we see a drop in our CIBIL Score, let me give you some tips that have best worked for me and the people around me.

Tips to increase (improve or maintain) your CIBIL Score

Increasing CIBIL Score

A) Pay for your loans/credit cards on time: You must understand many times we are shown the option of paying a minimum amount, and we happily do that however, this affects our score very badly. 

So, make sure that you pay all for loan or credit card dues on time and if you tend to forget then opt for an automatic payment mode.

Moreover, if you are facing some financial situation or problem then once it gets resolved, pay off all your due.

 B) Credit Mix and Duration: Limit your expenses of unsecured credit to less than 20% of your total credit limit. 

To understand how we can calculate a rough credit limit then, let us imagine your monthly salary is around 50,000 rupees then your monthly credit limit will be 25,000 rupees and then if you multiply it by 100, you get your total credit limit to 25 lakhs. 

This would mean that your monthly credit spending for unsecured credit should be below 5000 or at least around 6000 to 7000. 

Moreover, make sure that you don’t take too many loans in a short time. 

 C) Don’t show credit hungry behaviour: Showing a credit hungry behavior would mean spending way too much of your credit limit. Limit your credit card spending to less than 30% of your credit limit or monthly salary.

Moreover, limit your EMIs to less than 40% of your monthly salary. 

 D) Manage your credit cards well: Don’t take too many credit cards, and make sure that you pay the dues in full and on time. 

In case of some financial issue, make sure that you at least pay for the minimum due amount because if you don’t, the missed payment will be counted as a default. 

Remember to never close your old credit cards even if you are not using them anymore or if it has no new or better benefits, as a good repayment history is always a plus point in your CIBIL Score. 

E) Alternative loans or credit cards: Many people don’t know but applying for alternate loans or credit cards helps you rebuild your credit history when it is down too low. 

Take a loan or credit card against security like LIC policy, FD, golf, mutual funds etc, as when you provide security, it eliminates the need to check the score. 

Remember that even if they do not check your CIBIL Score but it is based upon it. 

F) Monitor loan accounts: Keep a check of your accounts, especially if they are linked to a joint loan or if you are a guarantor of a loan someone or a company took.

G) Avoid using BUY NOW PAY LATER (BNPL) apps or facilities: These BUY NOW PAY LATER applications or facilities are a trend these days, but these show us as your loans for every purchase that you make, thus it affects your score very badly. 

Only use it if necessary and then also make sure that you pay all of it before the due date. 

H) Keep a check on your CIBIL Score: Checking your CIBIL Score at least once a month is important because there can be inaccuracies that you might find in your credit report which are affecting your score.

If you find any inaccuracies in your credit report, let the CIBIL know. File a report or complaint in the CIBIL consumer dispute resolution. 

Note: Even if you report or file a complaint, CIBIL will only take action to correct your score if your bank approves of that mistake.

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