When you connect with the bank for loan purposes, the very first consideration they put is the CIBIL score. The CIBIL score is the credit history you carry in your last loan. A poor score can put your next loan in radar and you end up not getting the required loan. The RBI has strictly directed all financial institutions to check the credit history before lending the loan. In case, you have a bad credit score and want to improve it, then here are few steps-
Understand the score calculation-
To make your CIBIL score active, you need to first understand how it is calculated. You can use online CIBIL score calculator or connect with the bank. The score must be between 300 to 900. This will also help in gaining business loan with low interest. The business loan interest rates in India fluctuates so you need to be updated.
Maintain financial discipline-
Make sure you have a stable finance income that will help the bank to know if you are capable to repay the loan on time. Make it a point to clear all your outstanding loans are cleared.
Opt for long tenure loans-
Having a long tenure loan can help in having easy repayment of the loan. Moreover, the EMIs do not cost you more and also provides longer time span. Keep the EMI amounts low, so you can save money and expand your business further.