There has been an increasing demand for credit products amongst millennials across our country. Nowadays, a large number of millennials avail loans to meet their various financial requirements. Be it for travelling to their dream destination or purchasing consumer durable products, millennials avail loan for a variety of purposes. They also keep themselves abreast with the latest trends in the Banking and Finance Sector to avail the best deal for themselves. Moreover, to ensure that they get loans at competitive interest rates and with most favorable terms, they keep a check on their CIBIL score on a regular basis.

Importance of CIBIL score

• The CIBIL score determines the creditworthiness and repayment capacity of the borrower. It’s a numeric value that ranges from 300-900, and the higher the CIBIL score, the easier it is for applicants to avail a loan.
• Apart from increasing the loan eligibility, a high CIBIL score also improves the chances of availing a higher loan amount at a competitive rate and other favorable terms.
• With a high CIBIL score, borrowers can avail a credit card with high limit and be eligible for various discounts, offers and rewards.

Keeping the importance of CIBIL score in mind, millennials are taking proactive steps to ensure that they have a high CIBIL score. According to a recent study conducted by TransUnion CIBIL, the number of millennials who regularly check credit score has witnessed a growth by 58% as compared to 14% growth amongst non-millennials. Millennials also take various measures to improve their credit score and enhance the approval chances of their loan application. One of the most common credit products availed by millennials is the personal loan. With the introduction of digitization in the Banking and Finance Sector, availing a personal loan has become a convenient and hassle-free process. Easy accessibility, simple application process, quick loan approval and disbursal are some of the primary factors that have contributed to the increasing popularity of loans amongst the younger generation. Some of the major reasons why millennials avail a personal loan are mentioned below:

• Managing wedding expense
• To manage travel expenses
• For taking care of medical emergencies
• To fund their higher education
• To purchase electronic gadgets
• To clear credit card dues
• For home renovation

Having a good CIBIL score will not only improve the loan eligibility but also help millennials avail a higher loan amount at a competitive rate of interest. Therefore, it has been observed that millennials take extra efforts to improve their CIBIL score.

In case, you are finding it difficult to avail a loan due to your poor CIBIL score and you wish to improve the same, you can consider making use of the below-mentioned suggestions:

Maintain a healthy credit mix

To have a healthy credit score, you must avoid applying for multiple loans with different lenders within a short time. Also, ensure that you maintain a healthy mix of secured as well as unsecured loans. This will help you keep your credit score intact for a long duration.

Resolve the disputes

You should check your credit report thoroughly and make sure that it is error-free. Errors in a credit report can hamper your credit score significantly. Thus, if you happen to spot any disputed transaction in your credit report, you must get it resolved by contacting your credit bureau at the earliest.

Clear outstanding dues

It is essential that you clear your outstanding dues to have a good credit score. Also, make sure that you repay your existing loans and credit card bills on time. This will help you be more financially disciplined and have a good credit score at the same time.

It is important that you check CIBIL score for personal loan beforehand. You can check your CIBIL score by visiting the CIBIL’s official website. Having an idea of your CIBIL score will give you a fair idea whether your loan application will be accepted or not. It is advisable to apply for a loan only if you have a decent CIBIL score. This is because if the lender rejects your loan application, it will hamper your CIBIL score further. Before applying for a loan, you should compare various loan offers provided by different lenders. This will help you avail a loan that best suits your needs. Also, do not forget to read the terms and conditions of the loan agreement carefully before signing it. By doing so, you can avoid any inconvenience in the later stage. In case of any query, you must consider seeking the help of a financial decision to make a well-informed decision.