If your CIBIL score is low, there’s no need to worry. By wisely adopting these foolproof methods, you can dramatically improve your CIBIL score. Everyone talks about CIBIL scores these days, but many don’t understand their purpose or why it’s so important. A CIBIL score is a number that indicates whether you make your loan or credit card payments on time.

Sometimes, people’s CIBIL scores deteriorate, making it extremely difficult to obtain a loan or credit card in the future. If your CIBIL score has also deteriorated, you can try these smart methods to improve it and strengthen your financial credibility.

Check your CIBIL report and correct errors

Often, a poor CIBIL score is caused by incorrect information or duplicate data in your report. Therefore, it’s crucial to regularly check your CIBIL report. If you find any errors, have them corrected immediately by the credit bureau. Only accurate information will effectively improve your score. This is the first and most important step.

Always Pay EMIs and Bills on Time

The easiest and most effective way to improve your CIBIL score is to pay all bills and EMIs on time. Whether it’s a credit card bill or a home loan installment, late payments rapidly lower your score. Making timely payments creates a positive record with your bank and credit agencies, which boosts your score. Even a single default can severely damage your score.

Use Your Credit Limit Wisely

It’s also extremely important to use your credit card or loan limit wisely. Don’t always use the entire limit. Spend only around 30-40% of your savings. Doing so demonstrates your ability to manage your funds in a balanced manner and make timely repayments. Keeping your credit utilization ratio low boosts your score.

Never close old credit accounts

Many people think that old credit card or loan accounts should be closed. But never do this. Long-standing accounts strengthen your credit record. Opening new accounts is fine, but maintaining old accounts is also crucial to positively impact your CIBIL score. This reflects your long financial journey.

Resolve defaulted loans immediately

If you’ve ever missed a payment or defaulted on a loan, repay it immediately. Prolonged non-payment can further lower your score. Contact your bank or credit agency to resolve any open issues. This will clear your report and start improving your score.