To increase your CIBIL score, follow these proven steps that focus on disciplined financial habits and responsible credit management:
Key Ways to Improve Your CIBIL Score
- Pay Your EMIs and Credit Card Bills on Time: Timely payments have the biggest impact on your score, as payment history accounts for around 35% of it. Set up automatic payments or reminders to avoid delays and penalties
- Clear Existing Debt: Repay outstanding loans and credit card dues as soon as possible. Outstanding debt negatively affects your score, so clearing it helps boost your creditworthiness
- Maintain a Low Credit Utilization Ratio: Use less than 30-50% of your available credit limit. High credit utilization signals financial stress to lenders and lowers your score. Paying credit card balances in full each month is ideal
- Check and Dispute Errors in Your Credit Report: Regularly review your CIBIL report for inaccuracies such as wrongly reported unpaid dues. Disputing and correcting errors can quickly improve your score
- Maintain a Healthy Mix of Credit: Having a combination of secured loans (home, auto) and unsecured credit (personal loans, credit cards) demonstrates credit experience and can raise your score
- Avoid Multiple Loan Applications in a Short Time: Each loan application triggers a hard inquiry that can reduce your score. Space out applications and apply only when necessary
- Settle Old or Defaulted Loans: Negotiating settlements and ensuring these reflect as closed in your report helps regain lost points
Timeline for Improvement
- You can start seeing improvements in your CIBIL score within 3 to 6 months if you consistently follow these practices, but significant changes may take 6 to 12 months depending on your credit history
By adopting these strategies with financial discipline, you can steadily increase your CIBIL score, enhancing your chances of loan approvals with better interest rates and terms
. This approach is a strategic, long-term effort requiring consistent responsible credit behavior.
