A recent update has been issued regarding CIBIL scores, introducing new rules by the Reserve Bank of India (RBI) that loan holders need to know.
These rules apply to everyone with a loan, and both customers and banks must follow them.
The RBI introduced these changes to address common customer complaints about CIBIL scores. Now, banks and financial institutions will check the CIBIL score before approving any loans.
The score is equally important for both the bank and the customer. These changes aim to resolve ongoing issues and benefit customers.
To learn more about the new CIBIL score rules, stay with us. We will explain them clearly so you can understand and follow them.
New CIBIL Score Rules
As mentioned, the new rules aim to fix problems related to CIBIL scores. These changes will directly benefit customers by removing previous barriers.
The RBI has made it clear that banks, NBFCs, and credit bureaus must follow these rules. Strict actions will be taken against anyone who doesn’t comply.
Informing Customers When Checking CIBIL Scores
In the past, customers were often unaware when their CIBIL score was checked. Now, banks and NBFCs must inform customers before accessing their CIBIL report.
Customers will be notified via email or SMS. Failure to do this will lead to strict actions.
Providing Reasons for Loan Rejection
Previously, banks could reject loan applications without explaining why. Under the new rules, they must provide a clear reason for rejecting a loan request.
This allows customers to understand why their application was denied and take action. RBI also requires credit institutions to send a monthly list of rejected loan requests.
Access to Full Credit Reports
Under the new rules, customers can request their full credit report for free once a year. Credit institutions must provide the report through a link on their website.
This helps customers stay informed and make better loan decisions.
Informed Before Being Declared a Defaulter
Banks can no longer label a borrower as a defaulter without prior notice. Customers must be informed before being marked as a defaulter, and any CIBIL score issues must be addressed properly.
Banks may appoint a nodal officer to resolve these issues, ensuring no problems are left unsolved.
Resolving Issues on Time
If a customer has a problem with their CIBIL score, it must be resolved quickly. Banks have 21 days to fix the issue and notify the credit bureau.
The credit bureau has 9 days to address the issue. If the deadlines are missed, a fine of ₹100 per day will be charged.
Disclosure of Complaints
Banks and NBFCs must reveal the number of complaints they receive about CIBIL scores.
Credit bureaus must also post the number of complaints on their websites and resolve them within the set time frame.
If complaints are not addressed or disclosed, RBI will take action.
With these rules, the RBI ensures better transparency and accountability when handling CIBIL scores and customer complaints.
