The Reserve Bank of India, the central bank of the country, recognizes four credit information agencies — Equifax, CRIF Highmark, TransUnion CIBIL and Experian — and allows them to collect information on credit users and how they use credit. These four credit information agencies assign credit scores to credit users after taking into consideration varying factors, such as how regular has the credit user been with repayment, how dependent they are on credit, the type of credit they have, the number of years for which they have had access to credit, etc.

TransUnion CIBIL is the oldest credit information agency in the country — it was established in 2000 and therefore, it is not very surprising that most lenders operating within the country trust TransUnion CIBIL the most. After all, the credit information agency today holds records on more than 32 million businesses and 600 million credit users. The CIBIL score is the credit score assigned to credit users by TransUnion CIBIL. This score ranges from 300 to 900. 900 is the best CIBIL score any person can have. Such a credit score indicates exemplary credit behaviour. 

However, rarely does someone have a CIBIL score equal to 900. A score in the range of 800 to 900 is considered excellent and the mark of a responsible and smart credit user, someone who can be trusted to use credit wisely and repay it without defaulting. This article focuses on tips that allow credit users to build and improve cibil score above 800. Read on to learn more about how to increase your credit score or how to improve your CIBIL score above 800. 

Want to Improve CIBIL Score Above 800? Here Are a Few Tips That Will Help

  1. Your repayment history is one of the determining factors for your CIBIL score. If you have a clean repayment history with no major instances of loan default, your lender will assign you an excellent CIBIL score for your CIBIL score accounts for 35% of your CIBIL score. So, to build a CIBIL score above 800, build a clean repayment history with no cases of missed EMI and credit card bill payments. Borrow what you can comfortably afford and repay all your loan EMIs and credit card bills before the mentioned due date. 
  1. The credit utilization ratio accounts for 30% of your CIBIL score and is important too. If you want to increase your credit score, maintain your credit utilization ratio below 30%. But, what is the credit utilization ratio? It is the ratio of credit used to credit available. For instance, if the combined limit on all your credit cards is Rs.5 Lakh and the payment due on these cards is Rs.3 Lakh, your credit utilization ratio is 60%, which is quite high. Thus, in this case, you will need to reduce your credit utilization ratio to below 30% by clearing off some of your debt. The easiest way to maintain a low credit utilization ratio is to use credit cards only when you plan on clearing the entire amount due on your credit cards at the end of each month. 
  1. Having a mix of both secured and unsecured loans is important. Secured loans are loans backed by security or collateral. Unsecured loans, on the other hand, do not involve any security. Having a mix of both secured and unsecured convinces lenders and credit information agencies of your ability to handle all types of debt and therefore, leads to a high CIBIL score. 
  1. The age of your credit history is also important. It accounts for 10% of your CIBIL score. The longer you have been using credit, the better it is for your CIBIL score. It is thus that credit users are requested to always maintain old loan accounts and credit cards for closing these accounts and cards cause the entire credit history to get wiped off, which in turn, affects one’s CIBIL score negatively. 
  1. Lastly, if you want to improve your CIBIL score above 800, make sure to not be excessively dependent on credit. Lenders assess how often you apply for credit to understand or gauge your reliance on it. People who get rejected and yet keep applying for credit are seen as excessively dependent on credit and therefore, have a low CIBIL score. So, apply for credit only when you need it and if you get rejected, refrain from making a new application at least for a few months. 

Final Words 

If you are planning to get a housing loan, make sure your credit rating is in the ideal or excellent CIBIL score range. If your CIBIL score is lacking, do not worry, the simple tips shared in this article will certainly help you build an excellent credit rating in no time.