Thanks to modern advancements, you can run a free CIBIL score check on various portals. This includes lenders, financial aggregators and the official CIBIL website. In most cases, you can check CIBIL score by PAN card, as your PAN is a unique identifier.
To know about the importance and the process of checking your CIBIL score with a PAN card, read on.
Importance of Running a Free CIBIL Score Check Annually
1. Helps in Assessing Creditworthiness
Your CIBIL score helps in checking your creditworthiness on the basis on which your loan and other forms of credit approval are based. A credit score is a numerical summary of your credit history as well as your financial standing.
This information provides financial institutions with valuable insights regarding your loan repayment ability. Lenders check your scores to make a decision on the approval of your credit application.
Also, the terms of your credit, including the loan interest rate, the repayment tenure, and the loan amount, also depend on your credit score. Thus, running a free CIBIL score check is essential before applying for any loan.
2. Supports You in Spotting Fraud or Identity Theft
Yet another benefit you get when you check CIBIL score by PAN card is the detection of fraud and identity theft. When you check CIBIL score regularly, you can easily notice any changes in your score over time.
You can check your credit report to verify the transactions and spot any unauthorised accounts or transactions instantly.
By quickly identifying such fraudulent activities or identity theft through your regular free CIBIL score checks, you can take immediate action against it and rectify the situation. This prevents further damage to your credit score and protects your finances.
3. Assists in Catching Discrepancies in the Credit Report
Your CIBIL score gets impacted when there is any discrepancy or error in your credit reports. As it is evident that a credit report contains the following details:
It is common to find some mistakes in your credit report that may have a negative impact on your CIBIL score. This may happen when your EMI payments and other transactions are not recorded accurately on your credit report.
Also, there may be incorrect or unauthorised transactions recorded in your credit report, which can affect your CIBIL score.
When you catch such discrepancies or errors in your credit report, you can always dispute them and get them rectified. In such cases, you can visit the official CIBIL website to raise disputes and resolve concerns regarding your credit score discrepancies. You can easily spot such errors by running a free CIBIL score check annually.
4. Helps in Preparing for Loan Applications
Another great advantage of checking your CIBIL score is that you can prepare yourself for credit or loan applications well in advance. Different lenders have varying criteria regarding the CIBIL score requirement.
When you know your CIBIL score beforehand, it helps in saving you time and energy, as you need to send your application only to those financial institutions whose CIBIL score criteria match exactly with yours.
5. Provides Awareness About Financial Health
Performing regular CIBIL score checks is vital as they provide a clear picture of your financial health. Your CIBIL score reflects your creditworthiness while emphasising your financial standing as well. When you have adequate information regarding your CIBIL score, you can plan and manage your finances better.
When you have a lower score, it may imply that you are financially not very stable. This may be because of the reason that you are missing out on your EMIs or defaulting on credit. Furthermore, you can take steps to improve your score by becoming financially disciplined.
On the other hand, a good CIBIL score indicates that you are a responsible borrower who maintains a healthy credit mix and an ideal credit utilisation ratio, as well as repays your credit on time.
6. Helps in Assessing Your Negotiating Power
With an optimal CIBIL score, you get increased negotiation power that you can leverage to get a loan on favourable terms. A score of 750 and above is considered good, while a score less than 600 can delay or even reject your loan approval.
This is because a good credit score shows a positive repayment history, lower chances of default and late payments, and makes you a responsible borrower in the eyes of the lender.
You can utilise this negotiation power to get better interest rates, longer loan terms, lower fees and charges, etc.
Thus, running a free CIBIL score check is necessary to assess your negotiation power and use it to your advantage when availing credit. This can help you save money in the long run.
How to Check CIBIL Score by PAN card
Here are the steps you need to follow for a free CIBIL score check.
Step 1: Visit the official CIBIL website and log in with your credentials
Step 2: Choose the ‘Get your CIBIL score’ option on the page
Step 3: Enter your email ID, date of birth, pin code and mobile number
Step 4: Choose the ‘ID Type’ as PAN or Income Tax ID Number
Step 5: Provide the ID number that is your PAN details
Step 5: Click on the ‘ACCEPT & CONTINUE’ tab
Step 6: View your credit report and CIBIL score
As you can see, when you run a free CIBIL score check, you get an array of benefits. Doing this regularly is a healthy financial habit that helps you get credit ready, so you can rely on a loan when you need to.
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