Your CIBIL score is a powerful three-digit number that plays a significant role in your financial journey. Here are the top 10 tips to improve your CIBIL score quickly in 2025:
Pay your dues and EMI on time
Timely repayment is the most important factor that influences your credit score. Delayed or missed payments, even just once, can significantly bring down your score. To build a good credit score, pay off your Loan EMIs and Credit Card bills before the due date.
Keep your credit utilisation low
The credit utilisation ratio is the percentage of your credit limit you're using. If you're consistently using more than 30% of your total credit limit, lenders may view you as credit hungry. Ideally, keep this ratio under 30% or even better, below 10%.
Check your credit report
It's crucial to review your credit report from time to time. Errors like incorrect personal details, outdated Loan closures, or unrecognised transactions can hurt your score. If you notice any discrepancies, raise a dispute with the credit bureau and get it corrected.
Limit credit applications
Each time you apply for credit, a hard inquiry is generated on your report. Too many hard inquiries within a short period signal risk and can negatively impact your score. Apply only when necessary and space out your applications.
Repayment history
A good repayment history is the easiest way to increase your credit score. If you had Loans in the past and if you have paid the EMIs according to your Loan agreement, you can build good debt. Having a good repayment history is always helpful in improving your CIBIL score.
Focus on credit limit
Requesting a higher credit limit and keeping your usage low helps reduce your credit utilisation ratio. Avoid seeing a higher limit as permission to pay more.
Do not close old credit accounts
Older accounts help increase the average age of your credit history, which positively affects your score. Closing old, well-managed credit cards can shorten your credit history and improve your credit utilisation, especially if the card had a high limit.
Choose a longer tenure
EMIs can take away a considerable amount of your salary. Sometimes it can become challenging to manage. Hence, try to choose a longer tenure for easy repayment. If your monthly EMI is low, you can pay it off easily.
Different credit types
Lenders prefer a balanced mix of secured credit, like Home Loans, and unsecured credit, like Personal Loans or Credit Cards. Relying solely on one type may not reflect well on your credit profile. If possible, diversify your credit portfolio responsibly. Having different credit types is one of the best tip to improve your credit score.
Do not signal financial stress.
CIBIL scoring models are built to detect even the earliest signs of financial strain in your credit profile. Any behaviour that hints at potential risk can negatively affect your credit score.
Conclusion
Improving your CIBIL score in 2025 is all about understanding your financial behaviour and making smarter credit choices.
Comments
0 comment