what does zero or negative credit score mean

What Does a Zero or Negative Credit Score Mean?

April 03, 2024 • 759 views

A credit score is the key factor that lenders evaluate whenever you apply for a new credit. The score indicates your creditworthiness, and it ranges between 300 to 900. But what if you have a zero credit score or a negative score?

This blog helps you understand what zero and negative credit score means, if it is possible to get a loan, and how to build your credit score from scratch. Let’s begin!

What if Your Credit Score is Zero?

If your credit score is zero, that means your credit history is less than six months. It is also known as ‘NA’ or not applicable. If Credit bureaus give you a zero credit score, that means you do not have any credit history and have not taken any credit in the past six months.

What Does It Mean if Your Credit Score is Negative?

The credit score is calculated based on your credit history. A negative credit score means that your credit history is not available for the credit bureau to give you a credit rating. 

Hence, having a negative credit score is not bad; it simply means that you are new to credit, and it will take time to build your credit score.

Is It Possible to Avail of a Loan if You Have a Zero or Negative Credit Score?

There are chances that the majority of the lenders may reject your credit application as you don’t have any credit score. However, some lenders may offer a fixed deposit as collateral.

Steps to Get a Loan With a Zero or Minus Credit Score

You may get a loan with a zero or minus credit score if you follow the below-mentioned ways:

1. Prove Your Creditworthiness

To get your loan approved, you must appear creditworthy in the borrower’s eyes. But how is this possible when your credit score is 0? The answer is simple: if you have a stable source of income, you can avail of a loan from any lender. Whether you have a low credit score or no credit score at all, you can prove your creditworthiness to the lender by submitting your salary slip and bank statements.

2. Get a Co-signer

Apply for a loan with a family member or friend who has a strong credit score. This can increase your chances of getting loan approval. However, make sure that the co-signers are informed beforehand. Your co-signer has to fill out the KYC document. The lender will evaluate the co-signer’s credit history and bank statement to approve your loan application.  

3. Apply for a Lower Amount

If you have a lower credit score, it is a bit difficult for lenders to grant you a loan as they might doubt your creditworthiness. So, it is advisable to take a loan of a lower amount as the interest rate charged on it will be less.

4. Request Your Lender for a Zero or Negative Credit Report

If you have a zero or negative credit score, that indicates that you don’t have a credit history. In such a case, discuss with your lender regarding your credit inactivity. The lender will take it into consideration, but the loan interest rates can be slightly higher.

Also Read - How to Improve CIBIL Score to Get a Loan at Lower Interest Rates?

How to Build Your CIBIL Score?

There are many ways to build your credit score. Some of them are mentioned below:

  1. Pay your credit bills on or before the due date.
  2. Keep a low credit utilisation ratio.
  3. Clear all your existing debts.
  4. Borrow a mix of credit.
  5. Report any discrepancies in your credit report.

Also Read - How CIBIL Score is Calculated | A Step-by-Step Guide

To Conclude

It can be challenging to get a loan approval when you have a zero or negative credit score, but it is not impossible. Start by building your credit score with the help of an Instant Loan from Poonawalla Fincorp and enjoy the benefits of a higher loan amount and flexible repayment tenure. Ensure you check your credit score from time to time to make sure you have a good one, which can open the doors for credit opportunities in the future.


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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