CIBIL Score Calculation

Everything You Need to Know About CIBIL Score

May 19, 2023 • 11345 views

We often hear the word ‘CIBIL score’ while opting for a loan. But what is the CIBIL score, and how is it calculated? In simple words, the CIBIL (Credit Information Bureau India Limited) score or credit score, is a three-digit numerical representation of your creditworthiness.   A good CIBIL score ranges from 750 to 900 and indicates good financial behaviour.  This blog helps you understand how the CIBIL score is calculated, the factors that affect it, how to check your credit score using your PAN card and more. Read on!

What is CIBIL Score?

CIBIL (Credit Information Bureau India Limited) is one of the most reliable credit rating agencies. It keeps track of borrowers’ financial behaviour, such as loans, credit card payments, etc. They check this information to generate a score, known as the CIBIL score, based on repayment history and other such factors.  This score is a three-digit number that ranges from 300 to 900. A higher score, usually above 750, indicates that the individual is more creditworthy and has a good track of repayments. This gives the borrower leverage on getting the loan approved faster and at a better interest rate. 

How CIBIL Score is Calculated

A CIBIL score is calculated based on the FICO scoring model while calculating your CIBIL score. The credit bureau takes certain things into account regarding your credit behaviour and then adds weightage to each of them, which is sourced from the financial institutions.

Following are the weightage percentages that CIBIL assigns to each and every aspect of your credit behaviour:



Payment History


Credit Amount


Credit Type and Tenure





Also Read: What is the Minimum CIBIL Score Required for a Credit Card?

Factors that Affect CIBIL Score

CIBIL score is calculated primarily based on credit history and repayment behaviour. Here’s a list of factors that affect it:

1. Credit History

This factor includes the individual's credit accounts, such as credit cards, loans, and other forms of borrowing activities. The credit history shows the individual's repayment behaviour over time, whether they have cleared their dues on time or if they have ever defaulted on a loan repayment. Late payments or missed EMI payments can negatively impact the CIBIL score. 

2.  Types of Credit

This variable looks at the types of credit that the individual has opted for in the past including credit cards, Personal Loan, etc. Usually, a diversified and well-maintained credit portfolio can positively impact the CIBIL score, as it exhibits the borrower’s repayment capability and ability to manage different types of credit. Instead of opting for one type of loan, you must always choose a mix of secured and unsecured loans. A reputed and trustworthy Non-Banking Financial Company like Poonawalla Fincorp offers a host of different loan options for specific requirements.

3. Repayment Duration

The repayment duration considers the overall tenure of the credit and is based on your repayment timelines. Lenders use this to determine your ability to repay a loan on time and demonstrate responsible credit behaviour.

4. Credit Utilisation

This variable considers the individual's credit card usage and the balance they carry on their credit cards. A high credit utilisation compared to income can negatively impact the CIBIL score, as it shows high reliability on credit. 

5. Recent Credit Inquiries

This factor considers the number of credit inquiries made on your credit report, especially if there are any discrepancies. A high number of hard inquiries can negatively impact your CIBIL score, as it can suggest that you might be in financial distress and seeking credit from multiple sources.

What is an Ideal CIBIL Score You Should Maintain?

An Ideal credit score or CIBIL score lies between 700 and 900. A good credit score increases your chances of getting your loan approved quickly. Whether you opt for a Personal Loan, Business Loan, Pre-owned Car Loan, or a Professional Loan any CIBIL score above 750 is considered as an ideal CIBIL score for most of the lenders.

How to Check CIBIL Score Using PAN Card

A PAN card is a key document that is required for validating and carrying out most of your financial transactions, including – opening a savings account or applying for a loan. When applying for a loan, the lender uses a PAN card to get the credit report from CIBIL. The credit report contains credit history, repayment behaviour and outstanding debt. Ensure you maintain a good credit score, as it helps in getting loans approved without any hassle. If you are looking for ways to improve your credit score, check out ‘How to Improve Credit Score In 30 Days in India’?

Check Free CIBIL Score

Check your CIBIL score for free with the help of the below-mentioned steps:

Step 1: Go to Poonawalla Fincorp’s official website.

Step 2: Click on “Free CIBIL score”.

Step 3: Fill out the required documents and click on the submit button.

Once you have submitted the required documents successfully, your credit score will be visible on the screen and will be sent the same on your provided email.

Also Read: Understanding The Difference Between Credit Score And Cibil Score

To Conclude

CIBIL score is a crucial factor in determining your creditworthiness. It is calculated based on several variables, including repayment history, credit utilisation, length of credit history, types of credit, and recent credit inquiries. The PAN card is also linked to an individual's CIBIL score, as it is used to verify their identity and credit history. 
Maintaining a good CIBIL score is essential for individuals who want to secure loans or credit cards with favourable terms and conditions. By understanding how the CIBIL score is calculated and taking steps to maintain a good credit history, individuals can improve their creditworthiness and achieve financial stability.

Frequently Asked Questions

  • Is 722 a good CIBIL score?

Yes, according to CIBIL, if your credit score is in the range of 700 to 750, it is considered a good score.

  • Is credit score calculated daily?

No, the credit scores are calculated periodically; it is calculated monthly by credit bureaus based on the information provided by the financial institutions.  

  • Will my credit score lower the chances of getting my loan approved?

Not always; if you have a good credit score, i.e. above 750, the chances of your loan getting approved will be higher. Whereas if your credit score is below 650, it can impact the chances of your loan approval.


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.
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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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