banner image Difference Between Credit Freeze and Credit Lock

What is the Difference Between Credit Freeze and Credit Lock?

August 29, 2023 • 1686 views

A credit freeze and a credit lock both aim to prevent unauthorised access to personal credit information. These features also restrict potential fraudsters from opening new accounts by stealing your identity. However, these two features operate differently, and understanding their distinctions is vital for making informed decisions about personal credit protection. Read further to know about credit freeze vs credit lock. 

What is Credit Freeze?

A credit freeze is a useful security measure that protects you from identity theft and fraud. By restricting access to your credit report, it becomes tough for potential fraudsters to open new accounts in your name. This is because even lenders are unable to access your credit history without your permission. Hence, with a credit freeze, no one can obtain your credit information unless you lift or remove the freeze. 

What is a Credit Lock?

Similar to a credit freeze, a credit lock is a tool that restricts access to your credit report. However, it is a paid tool offered by credit bureaus in India and provides added convenience. You can easily unlock your credit report using a mobile app or website whenever you need to. 
Additionally, certain credit bureaus offer extra security features, such as fraud alerts when someone tries to access your credit report. This can help you track any suspicious activity and keep your credit information safe.

Key Differences Between Credit Freeze and Credit Lock

While both credit freeze and credit lock restrict unauthorised access to your credit, they still have some significant differences. The table below outlines the key features of credit freeze vs credit lock:

Credit Freeze

Credit Lock

It is a free-to-use feature.

Credit bureaus charge a monthly fee for providing the service.

Freezing takes up to 30-45 minutes and unfreezing takes up to one hour.

Locking and unlocking takes only a few seconds.

To freeze or unfreeze your credit, a request must be filed to credit bureaus.

You can instantly lock or unlock your credit through a mobile application.

It is suitable for those who do not apply for loans and new credits often.

It is suitable for those who apply for loans and credits regularly.

You can freeze your credit when you seek long-term protection against potential identity theft.

You can lock your credit when you are not planning to apply for new credit lines in the near future.

Advantages of Credit Freeze

Credit freeze ensures that no fraudster has access to your CIBIL report. So, read further to know how a credit freeze can protect your credit information:

  • A credit freeze prevents unauthorised access to your credit report and personal information.
  • Freezing your account does not charge you extra.
  • It provides peace of mind knowing that your credit information is secure.
  • A credit freeze can be easily lifted temporarily or permanently when needed.

ALSO READ :- How to Rectify CIBIL Report Mistakes?

Disadvantages of Credit Freeze

While credit freeze helps to secure your credit information, it also has its drawbacks that you should be aware of. Read further to learn the disadvantages of freezing your credit report:

  • Credit freeze temporarily blocks access to your own credit report, making it challenging to apply for new credit.
  • Requires lifting the freeze before applying for new credit, which can be time-consuming.
  • It is not 100% effective, hence it can not protect against all forms of identity theft or fraud.

Advantages of Credit Lock

With the feature of a credit lock, you can instantly lock your report and safeguard yourself from identity theft. Read on to know how you can maximise the benefits of this feature:

  • Credit lock provides added security to your report by blocking access to it.
  • You can easily use this feature online or through mobile applications.
  • Gives you a piece of mind against identity thefts and fraud. 
  • Enjoy additional security features such as fraud alerts and credit monitoring. 

Disadvantages of Credit Lock 

A credit lock is not a ‘free to use’ feature and has its drawbacks. Take a look at the following points to decide if it is better to lock or freeze credit:

  • Credit lock involves extra charges, unlike credit freeze. 
  • The paid feature might be attached to services that you do not need.
  • The facility of credit lock only lasts until you cancel the services. 

Here is How You Do Credit Freeze

The process for freezing your credit is straightforward. With the help of essential details on hand, you can easily freeze your report in under 10 minutes. Look at the following steps to start with the process:

  • Step 1: Contact the four major credit bureaus which are Equifax, TransUnion CIBIL, CRIF High Mark, and Experian, or visit their website to begin the process.
  • Step 2: Request a freeze from each of these bureaus. 
  • Step 3: Fill in the contact and other necessary information such as your name, DOB, address, social security number, etc on their websites and you will be provided with a PIN.
  • Step 4: Once you enter the PIN, your credit report will be frozen by credit bureaus, implying no one can access your credit history without your permission.

Here is How You Can Active Credit Lock

You can instantly lock your credit report by signing up for the service with any one of the leading credit bureaus. Read the following steps to lock your credit:

  • Step 1: Visit the website of credit bureaus and fill out the application form to set up a credit lock. 
  • Step 2: Log in to your account on the credit bureau’s website or apps using your username, social security number and password.
  • Step 3: Enable and disable the credit lock in a few taps.

When Should You Freeze or Lock Your Credit Report?

You can freeze your credit report whenever you feel the need to secure your credit information. Some situations when you can freeze your credit report include:

  • The times when you are not actively applying for new credits.
  • If you have experienced identity theft or fraudulent activity. 
  • When you want to limit access to your credit information.

ALSO READ :- STD, LSS & DPD Meaning in CIBIL and Their Differences

How Do Credit Freeze and Credit Lock Impact Credit Scores?

Both features protect you from fraudsters by locking your credit report. They do it without making any modifications to your credit report and do not affect your credit score in any way. 
While the security features may not impact your credit score, look out for the other potential factors that may influence your score. 

How to Check Credit Score for Free With Poonawalla Fincorp?

You can check your credit score with Poonawalla Fincorp online seamlessly by sitting in the comfort of your home. Check out the 3 simple steps to check your credit score for free:

  • Step 1: Click on the “Get Your CIBIL Score” button and select your employment type and gender. 
  • Step 2: Provide essential details such as your name, PAN number, email ID, etc.
  • Step 3: Cross-check the provided information while ticking the terms and conditions box, and complete the process by clicking on submit.

To Conclude 

Both credit freezes and credit locks are effective features to safeguard your credit information from potential identity theft and fraudulent activities. Understanding credit freeze vs credit lock will help you make an informed decision that aligns with your specific needs and preferences. 
However, you should research the laws and regulations in your region and carefully review the terms and conditions of any credit lock services before making your choice. 

Frequently Asked Questions

1.    Why is there a freeze or lock on my credit report?
It is because you had previously decided to freeze or lock your credit report as a preventive measure. You can lift the freeze or unlock your credit anytime you want.
2.    Is it good to lock your credit report?
Yes, it is a good measure to lock your credit. This will protect it from potential security breaches, unauthorized access, and other threats.
3.    How long does a credit lock last?
There is no set period for how long a credit lock can last. You can enable it and disable it as per your needs.
4.    Is the feature of credit freeze free of cost? 
Yes, a credit freeze is a free feature that you can use to safeguard your credit report from unauthorized access.
5.    How do you remove a credit freeze?
You can remove a credit freeze by contacting your credit agency and providing a PIN or a set password. The freeze will be lifted within an hour. 
6.    What is a fraud alert?
A fraud alert is a security feature that adds a layer of protection to your report against frauds and identity thefts. With this alert, a warning is generated on your credit report, advising you to take extra steps to confirm your identity. 

Disclaimer

We take utmost care to provide information based on internal data and reliable sources. However, this article and associated web pages provide generic information for reference purposes only. Readers must make an informed decision by reviewing the products offered and the terms and conditions. Loan disbursal is at the sole discretion of Poonawalla Fincorp.
*Terms and Conditions apply

poonawalla fincorp team

Poonawalla Fincorp Team

Our team of expert writers and editors are passionate about providing authentic and valuable information on finance. Our aim is to simplify financial and finance-related concepts. We strive to help our readers become more aware and empowered to make informed financial decisions.

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