How to Build Your CIBIL Credit History from Day One:
On July 12, 2018, we had come with our unique article “Can Minors have CIBIL or Credit Report?“. Minors can have PAN Cards, Minors can have Aadhar Cards, Minors can have Passports but minors can not have CIBIL Credit History, Driving License or Voter ID. To have CIBIL Credit History, the minors have to obtain loans but they can not get loans as they can not enter into a valid contract to bind themselves.
What to do when Minor attains Majority:
The day you attain the majority on your 18th birthday, you need to check your CIBIL Score and CIBIL Report. Obviously, your Credit Score will be minus 1 (-1) with a “No Hit” CIBIL Report as you have never availed any Credit Facility or Loan.
If a minor, who has attained majority only yesterday, approaches the Bank, the Lending Banker will hesitate to sanction any loan or Credit Card in the absence of any Credit History. In such a case you need to be trained to build a Credit History through Secured Credit Cards like SBI Unnati Credit Card which is issued with probing your CIBIL Credit History. I have advised thousands of my clients who have been able to Build their Credit Reputation by using the SBI Unnati Credit Card without making any default and they were able to lay the foundation stone of their Credit Scores. This is the start of the Financial Career of any individual which paves the way for unsecured credit card offers from other Credit Card operators. You can either destroy or build your Credit History in the prime of your youth – the option lies with you.
It is your Choice – Bad or Good Credit History:
I have seen many young boys and girls, who tarnished their Credit Reports and Scores by recklessly using their Credit Cards and were unable to pay the dues in time. Payment track records of your Credit Cards can either boost or tarnish your Credit Scores very fast. Word of caution – while using Credit Cards – Always Pay the Total Due amount and no the Minimum Due amount on your Credit Card and that too through online channels as Cash Payments in Credit Card accounts can go astray due to mentioning of wrong credit card account numbers and by the time you know about the missing credits – your credit history will get damaged substantially as Banks do not follow the Value Dated Credit System in India. It is my humble submission to Bank Managements in India to start giving the Value Dated Credit to the repayment going astray due to minor mistakes so that the Bad impact on Credit History gets automatically reversed after correction of the mistakes. To make this happen the IT Software engineers will have to programme the Value Dated Credit system in such a way that the Data Submitted to the Credit Bureaus gets automatically corrected about the repayments which could not be counted earlier due to mistakes.
Keep Vigil on your Credit Health:
If you have good Credit Report or Credit History, it does not mean that it will remain Good forever. Your Credit History can get damaged due to the following factors:
- You can yourself damage your CIBIL Credit Score by not following the repayment schedule for your Loan/Cash Credit/OD/Credit Cards.
- Banks or Lending institutions can damage your CIBIL Credit Reports by committing mistake not only at the time of initial opening of your Loan accounts but also afterward through careless handling of your loan accounts.
- Credit Bureaus like CIBIL can also generate wrong CIBIL Reports and as TransUnion CIBIL has confessed to one of my clients with the following confession: “If the personal information of an individual is common or similar to another individual, that data of two individuals get merged due to lack of unique identifier“
How to Keep Vigil on CIBIL Credit Report:
- First of all – obtain the copy of sanction letter in writing in respect of any secured or unsecured loan or credit card taken from any Bank. Never compromise on having the copy of the Sanction Letter which is your right as a borrower and will save you from many legal problems in the future.
- Check all your loan accounts regularly and in case the Bank has levied any charges or Penal Interest in your account – ask the Bank either to reverse the charges and penal interest or pay the charges and penal interest over and above the normal EMI along with interest for the period from the date of debit to date of repayment. However, you also need to check the underlying cause of levy of Penal Interest and regularise the account in such a way that Penal interest is never applied in your account. Levy of Penal Interest can also be due to banks committing mistakes while opening loan accounts, not entering stock reports in case of Cash Credit Limits, Feeding the wrong Rate of Interest in contrast to Sanctioned Rate of Interest. Increasing the Rate of Interest without increasing the EMI without the consent of the borrower. Debiting Cost of Insurance in your loan accounts without your knowledge as all charges and costs debited in loan accounts need to be repaid immediately over and above the EMI to keep the loan account regular.
- Check that all your Personal Details like Name, Mobile Number, Date of Birth, Aadhar Number, PAN Number, Passport, Driving License, Voter ID are correctly fed in the KYC system of the Bank. Never provide any Mobile Number belonging to someone else or even never allow someone to use your Mobile Number in their Loan accounts as the TransUnion CIBIL’s confession says – “If the personal information of an individual is common or similar to another individual, that data of two individuals get merged due to lack of unique identifier“
- Subscribe to Credit Health Checkup Plans to obtain a Free Copy of your CIBIL Report on the 1st of every month. Ensure that Credit Health Check Up Plans are taken from Real CIBIL Consultants who neither have their branches anywhere else nor they employ agents to work for CIBIL Consultants.
In case of emergent circumstances – Contact on Whats App Nos. +919814915812 or +918849950799 for immediate and quick solutions to all your CIBIL Problems.