New norms announced by RBI regarding CIBIL score

New norms announced by RBI regarding CIBIL score

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CIBIL score is the most important requirement for getting a loan. It is customary for banks or other financial institutions to check a customer’s CIBL score when applying for a loan.

Cibil score new rules india

Through this the credit history information of the customer will be obtained by the companies. In this case, when there was a complaint that CIBIL score information was not properly available to the customers, the Reserve Bank has announced some changes.

Reserve Bank of India (RBI) has issued several regulations to address concerns regarding CIBIL scores and the practices of credit information companies (CICs) in India. These regulations aim to ensure transparency, fairness, and accuracy in credit reporting and to protect the rights of consumers.

Here are some of the key regulations issued by the RBI

Free Annual Credit Report,

Individuals are entitled to a free copy of their credit report from each CIC once a year.

CICs must provide easy access to this free credit report, typically through their websites.

Disputing Errors,

Individuals have the right to dispute any errors or inaccuracies in their credit reports.

CICs must have a clear and transparent process for handling disputes.

If a dispute cannot be resolved, the consumer can escalate it to the ombudsman for further investigation.

Timely Credit Information Reporting,

Banks and non-banking financial institutions (NBFCs) must report credit information to CICs promptly and accurately.

This includes both positive and negative credit information, such as timely repayments and defaults.

Data Security,

CICs must implement robust data security measures to protect consumer information.

This includes protecting against unauthorized access, use, disclosure, modification, or destruction of data.

Consumer Awareness,

CICs must provide consumers with clear and easily understandable information about their credit reports and CIBIL scores.

This includes information on how to access their credit reports, dispute errors, and improve their credit scores.

These regulations are designed to promote responsible credit lending and borrowing practices, empower consumers with information about their creditworthiness, and safeguard their financial well-being.

These changes will come into effect from April 26, 2024.

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