How To Check Credit Score For Free Online?
Are you looking to purchase your dream car or take a home loan to finally move from a rented property to your own home? Or maybe you're considering giving entrepreneurship a try? Irrespective of the type of loan you take from a bank or an NBFC, having a good credit score is necessary.
So, what’s a credit score?
A credit score is a 3-digit score ranging between 300 and 900. A score of 900 is ideally the maximum an individual can get. All lenders use credit score to decide whether to sanction a loan or a credit card to a potential borrower. Simply put, it's a score to determine your financial trustworthiness.
The higher the credit score, the better is your creditworthiness, and the higher are your chances of securing a loan or credit card at better interest rates. In India, four licensed credit bureaus (also known as credit information companies) offer credit scores. The four credit bureaus in India are Equifax®, Experian™, TransUnion CIBIL™, and CRIF Highmark™. Credit bureaus are licensed to collect and gather financial reports of individuals and businesses from banks and NBFCs. Using the information gathered, credit agencies generate your credit report and credit score.
Generally, banks, NBFCs, and credit card issuers ask for an individual's credit score from a credit agency before sanctioning a loan or credit card. Scores over 750 are considered as good and help borrowers get loans at better interest rates.
Credit agencies renew the credit score and report of an individual every month. So, it’s highly recommended that individuals check their credit scores at least once every three months. Now that you've understood the basics of a credit score, the next big question is,
How do I check my credit score for free?
Checking your credit score periodically helps you get a clear picture of where you stand financially. It enables you to make smart credit decisions. Having a high credit score gives you an advantage when approaching a bank/NBFC for loans. It helps you negotiate for better loan terms. Even a slight reduction in the interest rate can help you save considerable sums in the long run.
If you’re wondering where to check your credit score for free online, here are the three ways to do it.
1. Approach your Preferred Credit Bureau
Individuals can get a credit report and check their credit score directly at any of the four credit bureaus in India. However, this method's major drawback is that credit bureaus offer credit scores and credit reports for free only once a year. If you wish to check your credit score more than once in a year, you have to pay the bureau's fee.
2. Approach your Bank
Today, it's common for banks to provide value-added services to their customers. One such service is providing its customers with their latest credit scores. However, note that not all banks offer this service, and even if they do, they may charge a fee every time they provide your credit score.
This brings us to the next method – the easiest and hassle-free way to check your credit score.
3. Check your score for free at a third-party financial portal like CreditMantri
There are several reputed third-party financial portals like CreditMantri that offer credit scores for free to their customers. You can check your latest credit score for free and within a few minutes.
Here’s a step-by-step guide to check your credit score for free at CreditMantri.
- Step 1 – Visit the CreditMantri website. Click on Free Credit Score.
- Step 2 – Enter your mobile number.
- Step 3 – Verify your mobile number with the OTP.
- Step 4 – Provide a few necessary details about yourself, like your date of birth, email address, and PAN number.
- Step 5 – Get your credit score for free.
Yes. It’s that simple. You can check your credit score any number of times for free when you use third-party financial portals like CreditMantri.
Let's now address one crucial question that is running on your mind,
Is it safe to check my credit score on a third-party site like CreditMantri?
Yes. It’s absolutely safe and in no way impacts your credit score. In India, as per the RBI mandate, credit bureaus must provide the credit score for free to individuals once a year. However, if you wish to access your score multiple times a year (it’s highly recommended that you monitor your score once every three months), then approaching a credit bureau is expensive. You have to pay a fee before you can access your score and report.
This is where third-party financial portals like CreditMantri come into the picture. Financial portals have tie-ups with any one of the four main bureaus and fetch your credit score from the bureau's records. For instance, credit scores provided by CreditMantri are powered by Equifax, so you can be assured that your personal details and data are safe.
Another fear that individuals have while checking their credit scores is whether the score will be impacted if using third-party sites. Inquiries for credit scores can be classified into two categories:
- Hard inquiry – Happens when a lender – bank, NBFC, or Credit Card Company – requests your credit score with the credit agency. Hard inquiries bring down the score by a few points.
- Soft inquiry – Happens when you request your credit score at a third-party platform or directly with the credit agency. Soft inquiries do not impact your credit score.
So, you can safely check your credit score multiple times using third-party financial portals like CreditMantri and keep track of your credit health.
Why should I aim for a good credit score of more than 750?
Having a good credit score offers many benefits. To put it simply, think of your credit score like your 12th standard marks. The higher the mark, the better are your chances of gaining admission to your preferred college. The same with credit scores. The higher the number, the better are your chances of securing loans at your preferred banks or NBFCs.
It not only boosts your chances of securing loans but also helps you:
- Get low-interest rates on loans – This is a huge advantage. As low-interest rates, reduce your loan burdens significantly.
- Get approved for your preferred credit cards – Since the credit score represents your financial habits, having a high score makes for a favourable impression. It helps you get approved for credit cards and even increases the available credit limit on your card.
Simply put, having a good credit score gives you more negotiating power when you approach a bank, NBFC, or credit card company for a loan or credit card. You can bargain for a lower interest rate and get other special benefits and offers.
Now that you've understood the benefits of having a good credit score use the step-by-step guide listed above to find your latest credit score for free. Periodically monitor your credit report and stay aware of your financial health. Cheers!