The Reserve Bank of India (RBI) has introduced new rules regarding credit scores, which aim to address many complaints people had about the system.
These changes will make it easier for you to access loans and ensure your credit score remains safe. The RBI’s goal is to create a more transparent and efficient credit score system.
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Key Changes in Credit Score Management
RBI has issued six new rules concerning the CIBIL score. These changes will simplify the loan process and improve transparency for customers with good credit scores, making it easier to get loans.
Faster CIBIL Score Updates
Starting from January 1, 2025, your credit score will be updated every 15 days. This rule ensures that people can track their credit scores regularly and stay informed about their financial standing.
Notification for Credit Score Checks
From now on, if any bank or financial institution checks your credit score, you will be notified by email or SMS.
This change comes after complaints were received about not being informed when credit score checks occurred. You will now always know when your credit score is being reviewed.
Transparency in Loan Rejections
RBI’s new rules require banks and financial institutions to explain why they rejected a loan application. This will allow you to understand the reasons behind a rejection, helping you work to improve your credit score in the future.
Free Credit Reports for Customers
Under the new rules, credit companies must provide customers with a free full credit report once a year. This will allow you to see your complete credit history
and understand your financial position. The link to your credit report will be available on the company’s website.
Notification Before Loan Default Reporting
If you are at risk of defaulting on a loan, the institution must inform you before reporting it to the credit bureau. This notification will be sent via email or SMS, giving you a chance to address the issue.
Complaints Must Be Resolved in 30 Days
If you file a complaint about your credit score and the credit company does not resolve it within 30 days, they will be fined Rs 100 per day.
The bank has 21 days to provide the information to the credit bureau, and the credit bureau has 9 days to resolve the issue. If either party fails to meet the deadline, they will face penalties.