If you have borrowed money on your credit card or borrowed from your bank and you are not paying it back on time, wake up. It is a very stupid thing to do – nor from a moral point of view but from a legal point of view. Remember, today we leave a digital foot print of what we do – mobile banking, credit card, debit card, online banking….all of this CAN BE traced by CIBIL.

For people who are not convinced that they should reduce their credit and improve their cibil scores, here are a few reasons..why they should:

  1. Peace of Mind: Given Indian conditions – we do not like to borrow. Having borrowed we try to get rid of our loans as soon as possible. So to be delinquent on our borrowings is not like us at all. Of course businessmen like Ruia, Anil Ambani, etc. have made it a habit of not repaying, but is that YOU? can you stay without paying? If not, here is the best reason.
  2. Bad credit costs you MORE money: When you go to borrow money you pay MORE interest than a person who is paying his amounts on time. PAYING higher interest for the same thing seems to be an amazing waste of money, right? This is the best financial reason why you should have a good Cibil score.
  3. Cibil score is NOT TO HELP YOU: it is now a great tool in the hands of our polite, courteous, efficient, chivalrous bankers to cajole, threaten, shame you to pay up criminally high charges. So when people tell you that a CIBIL score does not matter, they do not know how the banks work. For heavens sake even if it is a disputed amount, if it is small pay it off asap and clean up your Cibil records.
  4. Your potential employer can ask for your Cibil score – and it is not flattering to go with a poor score.
  5. Your potential landlord too asks for the latest Cibil score and he can use it to negotiate (or you can negotiate) the rent to be paid.
  6. Your mortgage lender may consider you for a loan ONLY above a particular score. Of course being in default WILL hurt.
  7. Your children’s educational loans will get rejected or far more expensive.
  8. You will not qualify for a new credit card
  9. Your children may be rejected for a new card – especially if the address remains the same.

9 reasons are enough I presume?

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  1. Dear Subramoney, Yes 9 reasons are more than enough! Loved the part where you brought the Indian conditions – we do not like to borrow. Having borrowed we try to get rid of our loans as soon as possible. So, once borrowed, to gain the very important peace of mind, it best to pay it off.
    I loved reading through and really a nice advice to all who have borrowed or planning to borrow. Thank you.

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