The Reserve Bank of India (RBI) has announced new rules to make credit scores simpler to understand and more transparent.
These changes aim to address complaints related to credit scores and improve the system, helping people get loans more easily and manage their credit better.
Credit scores are crucial for loan approvals, and the new rules will make it easier for people to maintain good credit standing.
Key Changes to Improve Credit Scores and Loan Processes
Faster CIBIL Score Updates
Starting January 1, 2025, your CIBIL score will be updated every 15 days. This will allow you to monitor your credit standing regularly and make timely decisions.
Notifications for Credit Score Checks
Whenever a bank or financial institution checks your credit score, you will receive an alert through email or SMS.
This ensures transparency and resolves complaints about unauthorized credit checks.
Explanation for Loan Rejections
If your loan application is rejected, the bank or financial institution must now provide a clear reason.
This will help you understand why your application was denied and guide you in improving your credit score.
Customer-Friendly Measures for Better Credit Management
Free Annual Credit Report
Credit companies are now required to provide you with one free full credit report each year.
You can access this report online via a link on the credit company’s website, making it easier to track your credit history.
Advance Notice Before Reporting a Default
If you are at risk of defaulting on a loan, the lending institution must warn you beforehand. You will be notified via email or SMS, giving you a chance to address the issue.
Timely Complaint Resolution
Credit companies must resolve credit score complaints within 30 days. If they fail, they will be fined Rs 100 per day until the complaint is resolved.
Loan-disbursing institutions have 21 days to share information with the credit bureau,
and the bureau has 9 days to act on complaints. Missing these deadlines will result in fines for both parties.
How These Changes Benefit You
The new rules will make the credit score system more transparent and accessible. With faster updates, clearer communication,
and timely resolutions, managing your credit and applying for loans will become much simpler and stress-free.
