Moneylife Foundation Credit Forum FAQ
Frequently Asked Questions
  • Credit Scores

    Question 1: What does your Credit Score mean?

    Credit Information Report contains detailed information of your credit history, including your identity information, credit accounts, loans, payments and recent enquiries. In addition the report also typically has a credit score.

    Credit Score is a numeric summary derived from your repayment history of previous or existing loans and credit cards and from the enquiries performed by banks & financial institutions based on your loan application. Your Credit Score is based on the information in your credit information report. Higher the score, the more favourably it is viewed by banks and financial institutions.

    Question 2: Would my Credit Score change if there is any change in my Credit Information Report?

    Credit Score changes over time, as your circumstances change. For example, paying off a loan could result in a higher credit score, while missing several repayments could reduce it. Every Credit Information Company has a separate range for credit score. There is no standard cut-off for a good score for a loan application.

    Lenders set different thresholds for accepting a credit / loan application. These thresholds can also vary according to the type of credit you want, so you could be accepted for a home loan application but your application for a personal loan may be rejected. Lenders may grant someone credit for a credit score of "X" when another bank / lender refuses.

    Question 3: What are the factors that negatively impact one's credit score and how to improve one's credit history?

    Delay in credit card payment, enormous number of application for credit card or loans, delay in payment of EMIs, etc. can affect credit score.

    Self-discipline in financial matters by paying back the borrowed amount (EMIs) on time and as agreed to the lender is the foremost step to ensure a good credit score.

    #1: Always pay as agreed

    All repayments - and missed ones - are recorded on your CIR. Missed payments and high outstanding amounts negatively impact your credit history and credit score. Pay your EMIs and credit card dues on time and as agreed to the lender.

    #2: Joint and Guarantor credit accounts

    Monitor your joint loans or loans where you are the guarantor regularly, since you are held equally liable for missed payments. Joint holder's negligence could affect your ability to access credit/loan when you need it.

    #3: Credit/Loan applications

    Inquiries made by lenders because of an application you made for credit or loan can affect your score. Too many inquiries might mean that you're taking on too much loan or that you're in some kind of financial trouble and are looking for credit to help you out. Shopping around for the best deal in terms of best interest rate for home loan or a new auto loan shouldn't cause a problem but always make sure that the lender knows you are asking only for a quote and not making an application for loan or credit. Checking your own credit report and credit score does not affect your score.

    #4: CIR is an important financial tool; don't ignore it

    Get a copy of your CIR soon after you begin using credit & check your CIR annually or after opening new credit accounts. If there is any erroneous data in your CIR, get it corrected with the help of the lender and Credit Information Company (CIC). You must allow time for updates to be reported; creditors typically report updates to accounts once a month to CIC, after the end of a payment cycle.

    Building and maintaining a good credit profile will enable you to access credit when you need it without much hassle. If your CIR shows that you repay credit on time, this will usually help you get credit. It may also help you get the best credit deals.

    Question 4: What are the major myths or common misconceptions regarding credit history?

    Knowledge is power when it comes to getting the credit/loan you want.

    Following are some of the common myths (misconceptions) regarding credit information company/credit bureau ('CIC') and credit history.

    #Myth 1: CIC decides who gets credit

    Fact: CICs do not make judgments about the information in credit information report ('CIR'). CICs simply compile information that is provided directly and voluntarily by member lenders. The CIR is comprised of credit cards, home or auto loans or other monthly payments. Lenders use that information to help them assess the risk of lending to an individual.

    Myth 2: CIC denied you credit

    Fact: CICs compile and hold your credit report securely. CICs don't make decisions; that's up to lenders, who check the information in your CIR along with other information such as items from your loan application.

    Myth 3: CIC holds a credit blacklist

    Fact: CICs do not hold any credit blacklist. Some factors that lenders do consider include your repayment history and how much you already owe. Lenders want to be sure that you aren't taking on more credit/loan than you can comfortably manage to repay.

    Myth 4: Once a credit score is bad, it can never be rebuilt.

    Fact: Credit Information Report ('CIR') contains detailed information of your credit history, including your identity information, credit accounts, loans, payments and recent enquiries. Credit can be rebuilt over time. Your CIR indicates which credit accounts are closed or inactive, but the history remains nonetheless. Late or missed payments stay on your CIR as payment history. Rebuilding credit means paying on time and the longer a credit history is without negative information, such as late payments, the better. The older the negative information is, the less significant it becomes.

    Myth 5: Checking your own individual CIR affects your rating.

    Fact: If you access your own Credit Information Report ('CIR'), it does not have any effect on your credit score since it is a non-credit enquiry. You reviewing your own CIR will only be seen on a personal CIR.

    When you apply for credit/loan you provide consent to the lender to review your CIR, and an enquiry will be added to your CIR. Such credit enquiries are shown to other lenders because they may represent new loan that doesn't yet show on a CIR as a loan account. Credit enquiries can affect credit scores.

    Everyone should check their own CIR at least annually. It's part of good credit management.

    Question 5: Does using credit cards negatively impact one's credit history?

    People use credit cards for varied reasons, from making mobile and utility bill payments to buying expensive gadgets and home appliances. Credit cards are gaining popularity amongst everyone, particularly with the working middle class. Your bank assesses your overall spending limit and issues cards accordingly. It is important to understand that increased credit limit usage or additional lines of credit could have an impact on your credit profile if not handled in a correct manner. Your credit profile that is build up in a Credit Information Company (CIC) is a composite of your credit behaviour with all your banks and lenders over a period of time.

    If a card holder defaults on any payments, this will be reflected as a default on the Credit Information Reports. If a stretched credit usage results in over leverage and consequently a delay in repayment this will have an impact on your credit profile and your credit score. The prudent path would be to ensure that you make use of credit limits wisely and typically spend on your card what you can repay to your bank on the repayment due date.

    Question 6: How often is the information in the Credit Information Report updated?

    In general, members such as banks, financial organizations forward consumer credit information to Credit Information Companies on a monthly basis. The day of the month that each individual member sends updates varies. In other words, the CIC might receive an update from member A on the first of every month and from member B on the 11th of every month, etc. Ideally, the CIR is updated on a monthly basis post receiving credit data from members.



Bullfighting, Goa's worst kept secret
Police often arrive at the spot and disperse the crowd, but the bulls refuse to call it quits
At a barren paddy field near the picturesque Siridao beach, hundreds of crazed onlookers cry 'Rocky, Rocky', while another set amongst the audience shouts 'Rambo, Rambo' as two bulls ram their giant heads against each other again and again.
Rocky and Rambo - popular names for fighting bulls -- are almost Sylvestor Stallone-like in their physicality, their well-defined muscles sweating with the strain, as the frenzied beasts use their sharpened horns to dig into the opponent's neck.
Police often arrive at the spot and disperse the crowd, but the bulls refuse to call it quits. Next week, the bullfight organisers shift base to yet another location, whose details are forwarded on short notice on secret WhatsApp and Facebook groups, to which entry is only by member reference.
Welcome to the world of Goan bullfighting, banned by the courts and but still passionately loved by a section of the state's population, which is now being promised by politicians across party lines to "legalise" the sport. Bullfighting, Goa's worst kept secret, takes place more often than it should despite the legal ban. Chief Minister Laxmikant Parsekar has said his government wants to legalise the event, arguing it could be a good source of revenue.
"We are looking at ways to legalise bullfighting. It can be a good source of revenue for tourism as well as for farmers who raise these bulls," Chief Minister Laxmikant Parsekar told IANS.
The Panaji bench of the Bombay High Court had banned the bull-fights in Goa in the late 1990s. But the order has not stopped the bullfights.
Coastal villages like Benaulim, Colva, Fatorda, Betalbatim in South Goa and Mandrem, Siolim, Morjim and Arambol in north Goa are well known among bullfight aficionados for hosting the fights at short notice.
A bullfight earlier this week, outside Parsekar's school Harmal Panchkroshi in Arambol was caught on camera and broadcast on local cable news channels, which showed hundreds of aficionados in attendance.
Parsekar, whose government has formed a legislative committee to examine whether bullfights can be restarted legally, did not deny the bullfight on Sunday.
"It did not happen within the school premises... Sometimes bulls fight on their own," he said.
Parsekar also did not rule out constructing a special stadium to host bullfights, on the lines of Spanish arenas.
The bugle for legalising bullfights has been blared in the past by politicians from across party lines.
Former chief minister and ex-Congress Lok Sabha MP Francisco Sardinha, a self-proclaimed bullfight lover, had even moved a resolution in parliament in 2013 in a bid to legalise the sport.
"Which animals do not fight before procreation or mating? You think without organising these fights bulls do not head-butt otherwise at all?" Sardinha has said, defending the sport.
BJP MLA Vishnu Wagh, who is heading the Bharatiya Janata Party-led government's legislative committee on bullfights, said that the concerns of animal rights activists about bulls getting hurt during such fights will be factored in the deliberations of the forum, which is seeking ways to legalise such fights in Goa.
"The horns of the bulls could be capped with rubber to ensure that the animals are not hurt. Bull fighting is a traditional sport of Goa and is connected to agricultural tradition," Wagh told IANS.
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.




1 year ago

It would be a lot more interesting if those who like bullfighting were themselves fighting. People would pay more!

Whenever humans have anything to do with animals, animals suffer

Nifty, Sensex may rally - Weekly closing report
If Nifty stays above 7,700, it may rally up to 8,100
We had mentioned in last week’s closing report that Nifty, Sensex may give up some gains and that Nifty has to stay above 7,930 for the gains to continue. During the course of the week’s trading, the major indices in the Indian stock market were struggling to rally due to negative global markets’ cues. It was a dull market with the market indices moving sideways most of the time. The summary of movements of the major indices during the course of the week’s trading is given in the table below: (Over the week, the major indices have made marginal losses of 1%-1.5%).
Healthy domestic funds inflows, announcements on financial sector reforms and hopes of a rate cut arrested the slide in the market indices which closed flat on the back of weak global cues on Monday. Market watchers elaborated that the global growth concerns coupled with fears of a possible US interest rate hike in the latter part of 2015 played negatively on investors’ sentiments. On Tuesday, there was a major correction of over 2%. Market observers cited weak European cues, especially after the re-elections in Greece, the dwindling rupee value and the upcoming derivatives expiry, as the main reasons for the markets' fall. The RBI (Reserve Bank of India) will decide on whether or not to cut interest rates in its upcoming monetary policy review slated for September 29. Sector-wise, banking, capital goods, automobile, metal and oil and gas stocks came under intense selling pressure.
US market analysts pointed out that the market now worries about whether the Fed could possibly be seeing a serious slowdown and that is why it chose to keep interest at the same level. The Indian stock markets again came under pressure during the initial trade on Wednesday, as weak Asian cues emanating out of a below-expected Chinese PMI (purchasing managers' index) data spooked investors. 
Indices opened on a lower note on Thursday, following a sharp downward correction in Japan's Nikkei and US futures. However, the market pared the initial losses and closed marginally higher. 
All interest-sensitive stocks like banking, automobile and capital goods made gains on hopes of a rate cut by the RBI during its upcoming monetary policy review slated for September 29. On Friday the market was closed on account of Id.
Out of the 27 main sectors tracked by Moneylife, top five and the bottom five sectors for this week were:


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