Credit scores help lenders in evaluating the creditworthiness of individuals and businesses. Loan approvals and interest rates will be influenced by the credit scores of the Individuals and Businesses. Higher credit scores will increase the chances of getting loans sanctioned for the borrowers. Lenders rely on credit bureaus like CIBIL for obtaining credit scores of loan applicants.
What is CIBIL?
CIBIL, or the Credit Information Bureau (India) Limited, provides credit scores for both individuals and businesses to assess their creditworthiness. A consumer CIBIL score is used for individual borrowers, while a commercial CIBIL score is designed for businesses. Both scores are vital tools for accessing loans, determining favorable credit terms, and understanding credit health, making them essential for individuals and commercial entities alike.
What is Consumer CIBIL?
A consumer CIBIL bureau assigns each individual a consumer CIBIL score, ranging from 300 to 900, representing their creditworthiness. This score is a numeric summary of the person’s credit history, generated from their credit information report. The report includes details on credit exposure, payment patterns, any defaults, and the duration of credit. To access this information, individuals can use the consumer CIBIL login and regularly monitor their consumer CIBIL score to stay informed about their credit profile and financial standing.
What is Commercial CIBIL?
Similar to the Consumer CIBIL Bureau, the Commercial CIBIL Bureau evaluates credit information, but it focuses on companies, businesses, and institutions instead of individual consumers. The credit activity of these organizations is summarized in a commercial credit report.
Understanding What is Company Credit Report(CCR):
A Company Credit Report (CCR) provides a comprehensive financial profile of a business, helping lenders assess its creditworthiness. It includes critical details about the company’s credit history, outstanding loans, repayment behavior, and financial standing.
Key Elements of a Company Credit Report:
- CIBIL Rank – A summary score ranging from 1 to 10, where 1 is the best, reflecting the company’s overall credit health.
- Credit Facilities – Detailed bank-wise loan information, including active and inactive facilities, sanctioned amounts, and payment history.
- Company Profile – Essential business details such as company name, address, and key contacts.
- GST Report – A structured report of GST returns for easy financial assessment.
- Enquiries – Records of all loan applications and inquiries made by the business.
- Credit Facility Utilization – A consolidated view of working capital loan usage, sanctioned limits, and drawing power.
Note: We need to understand that the Commercial CIBIL Score (or CIBIL Rank) is a summary score derived from the CCR.
Difference between Consumer CIBIL and Commercial CIBIL
| Aspect | Consumer CIBIL | Commercial CIBIL |
| Who It’s For | For individuals | For businesses and companies |
| CIBIL Score and Rank | A score between 300 and 900 (higher is better). | A rank between 1 and 10 (1 is the best). |
| Report Type | Generates a Consumer CIBIL Report for individuals. | Issues a Commercial CIBIL Report for businesses. |
| Purpose | Helps banks/financial institutions check if a person can repay loans on time. | Helps banks/financial institutions assess if a business is financially stable. |
| What It Looks At | Tracks personal loans, credit cards, and bill payments | Tracks business loans, company financials, and repayment history. |
| What Affects the Score | Based on credit card usage, loan payments, and debt amount. | Based on business profits, loan repayments, and credit usage. |
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How to Check Consumer CIBIL Score?
1 Through the Official CIBIL Website
- Visit the official website of CIBIL
- Click on “Get Your Free CIBIL Score”
- Register with your name, date of birth, email, and phone number
- Verify your identity using PAN or other ID proof
- Get one free credit report per year (additional reports may require a fee)
- Download your report after verification
2. Through Banks and Financial Institutions
- Many banks provide free CIBIL scores to their customers
- Check your net banking or mobile app under “Credit Score” or “CIBIL Score”
3. Through Third-Party Websites. Eg Paisabazar
Important Points to Remember
- You are entitled to one free CIBIL report per year
- Check for errors in your report and report them immediately
- Avoid checking too frequently, as multiple inquiries can lower your score
- Always use trusted platforms to check your score safely
For businesses, the commercial CIBIL score is available through a separate process. Let’s take a look at that below.
How can MSMEs check Commercial CIBIL Scores?
To access your Commercial CIBIL Score online, follow these steps:
- Go to the official website of CIBIL
- Look for the option to access the Company Credit Report (CCR) or Commercial CIBIL Report.
- Purchase a plan(Basic, Standard or Premium based on your requirement) and fill in your company details, including the name, ID type, ID value, GSTN value, contact information, and address.
- Accept the terms and conditions, then proceed by clicking on “Submit & Continue to next step.”
- Select your preferred payment method on the following page. The payment amount will depend on the plan you choose.
- After completing the payment, you will receive a Transaction ID and Registration ID via email.
- Upload the required KYC documents. Once the documents are verified, the CIBIL Rank and Commercial Report will be delivered to your registered address within seven days.
What is CIBIL MSME Rank, is it the same as CIBIL Rank?
No, CIBIL MSME Rank (CMR) and CIBIL Rank are two different products. For MSME lenders specifically, CIBIL offers a product called “CIBIL MSME Rank” (CMR). It is a credit rating framework that objectively quantifies the credit risk of MSMEs. Using TransUnion CIBIL’s extensive credit data, it analyzes past credit behavior and predicts the probability of default over a year. CMR supports lenders in borrower acquisition, risk appraisal, portfolio monitoring, and automated decision-making, helping improve efficiency, risk management, and business growth.
Conclusion
Understanding the distinction between Commercial and Consumer CIBIL is essential for both businesses and individuals. Commercial CIBIL supports businesses in evaluating credit risk and obtaining financing, whereas consumer CIBIL focuses on assessing individual creditworthiness.
To obtain your Commercial or Consumer CIBIL report, visit the CIBIL website and follow the outlined steps. Lenders frequently review these reports when assessing loan applications and setting interest rates.
FAQ
1. How does a low Commercial CIBIL score impact a business?
A low Commercial CIBIL score can hinder a business’s ability to secure loans, increase borrowing costs, and limit access to credit, ultimately affecting growth opportunities and financial stability. It signals higher risk to lenders.
2. Does a business owner’s Consumer CIBIL score affect their Commercial CIBIL score?
Yes, a business owner’s Consumer CIBIL score can influence their Commercial CIBIL score. Lenders may consider the owner’s personal creditworthiness when assessing the business’s financial stability and credit risk, impacting loan approval and terms.
3. Can both Consumer and Commercial CIBIL reports affect loan approvals?
Yes, both Consumer and Commercial CIBIL reports significantly impact loan approvals. Lenders assess individual creditworthiness through Consumer reports and business creditworthiness via Commercial reports, influencing decisions on loan eligibility and terms.
4. How can a business improve its Commercial CIBIL score?
A business can improve its Commercial CIBIL score by maintaining timely payments, reducing outstanding debts, managing credit utilization, regularly reviewing credit reports for errors, and establishing a solid financial track record with lenders.
