Guide To Equifax India Credit Report

If you plan to live a well-settled and healthy life, it is important to examine your credit report every year and understand everything in it.

The key to many of your dreams comes down to one factor: your credit score. When it comes to purchasing a loan, a job, housing, or insurance, your credit history and score matter.

Let’s quickly understand the basic aspects of the credit score.

What is a Credit Report?

A credit report is a three-digit numeric summary of your payment or credit history of your bank accounts. The credit history helps you understand how well you’ve handled your money and credits in the past. A good credit score indicates your creditworthiness, the higher credit score helps you get the loans easily and at better interest rates.

A credit report is a record of four important information about:

I. Your personal identity: includes your name, address, date of birth, bank account number, or employment information

II. Your existing credit information: includes information about credit that you have, such as, credit card accounts, mortgages, and loans you’ve taken. It determines how much money you owe to your creditors and length of your credit card usage.

III. Your payment history: includes all the history of your payments such as how efficiently you have paid all bills; whether you’ve paid on time or late.

IV. Other inquiries: these inquiries are generated from the information recorded by local, state or central governments. It can include any property purchases, liens, court judgements, bankruptcy, and or any other criminal records in the past if any.

Important Points To Be Noted

Credit score measures the credit risk of an individual. The score ranging between 750-900 is considered excellent.
A “good” credit score shows you pay on-time bill payments with no dues, and are likely to afford to apply for any loan applications and get interest rates while a “bad” credit score shows you’re late with payments or did not pay at all which represents that you’re not qualified to get a loan at good interest rates or any other credit offer.
You can get your free credit report by Equifax India, a credit information company (CIC) or a credit bureau licensed by the Reserve Bank of India registered under the Credit Information Companies Regulation Act, 2005.

Why is a Credit Report Important?

Credit Report is a critical factor in making your financial life secure and safer. If your credit score on the credit report isn’t good, you won’t be offered any credits from lenders. So focusing on your credit score is important to be able to afford to get approved loans which can save you money in the long term.

“No matter what, a higher credit score is better for you, and lower is bad.”

Your credit report is important to a lot of people; banks, mortgage lenders, insurance companies, employers and more. So, it’s essentially necessary to have a good credit report. Your credit report will help credit information companies or credit bureaus to assess how you manage your finances.

Banks: if you plan to open a bank account, the bank is likely to check your credit score to analyze the risk of abandoning an account
Mortgage Lenders: Lenders may check your credit score to check if you can afford to get a loan and the terms (the interest rate charges may vary depending on the score).
Insurance companies: they may use the credit report to check your creditworthiness or the likelihood of the eligibility of getting the insurance and to set the rates.
Employers: they may check your credit report to assess your financial responsibility and stability
Landlords: they may request a check to your credit report to check your ability to pay rent on time.

According to the ‘How India Borrows 2024’ – a study released by Home Credit India, Indians were taking loans to purchase consumer durables, followed by lending for business and house renovations. The study further showed that:

Borrowing for smartphones and home appliances increased from 1% in 2020 to 37% in2024,
Borrowing for business expansion and start-ups jumped from 5% in 2020 to 21% in 2024,
Borrowing for home renovation/construction saw a modest rise, from 9% in 2022 to 15% in 2024, and
Borrowing for marriages gradually increased from 3% in 2021 to 5% in 2024.

Check Your Free Credit Report by Equifax India

Equifax India is a credit information agency that can help you provide a credit score. Equifax India will provide you with a summary of detailed information about your credit history, along with information related to your personal identity, account details, recent financial inquiries, etc.

Equifax India is one of the best credit information companies operating in India which can help you to determine your rate of creditworthiness. This credit bureau is licensed by the Reserve Bank of India to issue free credit reports.

To get started with a free Equifax Credit Report, download the Equifax app on your smartphone to create a my Equifax account, and log in using your email address by entering a 6-digit pin.

To verify your identity, you will need to get your KYC by providing your personal information along with your Aadhaar number. You’ll receive a one-time password on your registered mobile number, enter the password and you’re done with the KYC verification.

Now, to completely log into the Equifax app you also need to provide information or details related to your Passport, PAN card, or Voter ID Card. There is a waiting time of 24 hours to get yourself logged into the app.

Once the 24-hour time is finished, you will be asked to answer a few questions based on your credit history to authenticate your identity. After the authentication process is completed, you will get your free Equifax Credit Report emailed to your registered email address. The report will be password protected and can be accessed using a username and password or Touch/FaceID technology. Be noted that your credit report must be password-protected to maintain confidentiality.

Importance of Equifax Credit Report

Credit Report plays an important role in your financial success. It serves as a key component of your financial health, helping lenders, employers or others to determine your creditworthiness based on your credit history. Let’s get to know the importance of getting credit report from Equifax India:

It helps in knowing your money management skills
It helps in achieving your long dreams such as buying a new house, applying for loans, finance a car, getting a new job opportunity, a holiday vacation
A credit report is important because it can make you responsible borrower and you’ll get to know about the management of finances in a better way
It can help you know how lenders, landlords, employers, business owners, insurers will view your application

Key Factors that Affects Your Credit Report

Your credit report is created to check how well you manage credit and how risky it would be for the lender to lend you money. Lenders, and other financial institutions will look at your credit report to evaluate the credit history along with the credit score based on it and use them to determine how much interest they will charge you to borrow money.

If you have a poor credit history in your report, getting a loan, or mortgage could be very difficult or you may struggle to sign up for a new credit card. It could also affect your ability to rent an apartment, buy a home, get a car, or find a job.

Having a good credit history will make it easier to qualify for any type of loans at better interest rates. This can save you a lot of money and time.

Let’s talk about some key factors which need to be considered and may affect your credit report and credit score. Each factor plays a crucial role in calculating credit score.

Payment history: One of the most significant factors is your history of making payments. Your credit score depends on how you carry your outstanding balances and keeping up with your monthly payments. Unpaid bills and missing payments on time may decrease your score.
Credit Utilization: The ratio expressed in percentage to evaluate the amount of debt you accessed to and currently accessing to. It is calculated by dividing the sum of all our outstanding credit card balances by the sum of your credit limits.
Credit History: How much borrowed money you carry is also one of the factors that affects your credit score. The higher the credit amount lenders will see in the report, the lesser the likelihood that you will repay loans in a timely manner.
Number of credit inquiries: lenders, mortgagers or others may check information about your recent credit card applications and inquiries, to determine if you’re able to repay the credit borrowed by them.
Public Record: This record contains any information about court judgements, any illegal records against your property or bankruptcy.

“You must gain control over your money, or the lack of it will forever control you.” — Dave Ramsey

Understanding the Difference Between Credit Report & Credit Score

Credit Report Vs Credit Score can seem like different but they are a lot more similar than you may think.

A credit information report is a summary of an individual’s credit and repayment history calculated by credit bureaus like Equifax India, to give lenders an idea of your creditworthiness.

A credit score is a three-digit numeric representation of the information in your credit report. The score tells the positioning of your credit. The higher score describes that you’re a responsible borrower and are most likely to make payments on time. The lower score indicates that you can’t afford to pay back the amounts you will borrow from potential lenders.

Credit Report and Credit Score are both crucial to a successful financial life of an individual. Both are essentially used by lenders or other financial institutions to determine your credit risk or the ability to borrow money as well as the favourable terms for the loan including interest rate.

What’s included in your Equifax India Credit Report?

Your credit report is the lifeline to your successful and happy financial life.

Whether you are a salaried employee or self-employed individual, understanding of credit reports and improving credit score all play a big role in the achievement of your financial goals.

The majority of credit reports are maintained by one of the best credit bureau- Equifax India which offers free service to check your credit report.

Your Equifax India Credit Report may include the following types of information:

Personal Information: your your name, address, date of birth, and Social Security number
Credit Information: Equifax India collects this information from your creditors and lenders to know about your credit cards and loans, accounts and their payment history.
Inquiry Information: Equifax collects information about your inquiries on requesting credit reports in the past from other companies or inquires lenders or insurers who have requested your credit report.
Bankruptcies: any public records or related details about bankruptcy or a court decision against you that relates to credit
Other accounts information: Equifax also verifies the accounts that are due or closed or turned over due to a reason.

By using the above information, your credit score is calculated and is represented by a 3-digit number.

Note that if you use your credit responsibly you will get points, but if you have outstanding debts, you’ll lose points which will affect your credit score.

Credit Score Rankings according to Equifax Canada ranges as the following:

800-850: Excellent
740-799: Very Good
670-739: Good
580-669: Fair
300-579: Poor

Five Ways to Improve Your Credit Score

You’ve probably read all the tips and tricks on improving your credit score – but no way your credit score increases by any chance.

You’ve received your credit report and it looks good at first, but then your credit score isn’t very good and you’re wondering if you might face difficulty in qualifying for a new credit.

If you’re panicking, don’t be. We have collated 5 of the most effective techniques to improve your credit score. Let’s take a look at them and see how they can help you.

Monitoring your credit report

Tracking and analyzing your credit report can help to detect errors, or incomplete information to ensure your credit score is pristine. This ultimately leads to better finance management.

According to Equifax, it’s a good idea to check your credit reports at least once a year.

After all, it’s all about taking proper care of your payment history

1. Keeping your credit utilization low

Paying attention to your credit utilization is equally as important as paying bills on time to build a good credit score. In simple words, credit utilization means how much you’re using your available credit? It is typically expressed as a percentage. Keeping a low credit utilization ratio indicates that you’re in better control of your spending habits. Experts recommend keeping your ratio aiming your credit utilization below 30%.

To calculate your credit utilization ratio, you need to add up the credit limits of all your credit cards and add up their current balances – divide the balance total by credit limit total and multiply it by 100.

According to FICO, those that do use credit cards often keep balances low, only using an average of 7% of their available revolving credit.

2. Setting up payment reminders

To avoid late bill payments or missed payments, make sure to set up automatic payments or set up reminders in a calendar. This ensures helping you improve your credit score. You can set up daily, weekly or monthly automated payments reminders within your accounts. keeping you on track with your expenses. This simple step helps you stay organized and stress-free while managing your finances.

3. Only Apply for New Credit When You Need

Lenders, mortgage providers, and other financial institutions review your recent credit activities to assess your creditworthiness. Applying for multiple new credit accounts too often can negatively impact your credit score. To maintain a healthy credit profile, only apply for new credit when necessary and space out your applications to avoid potential red flags.

4. Maintain Longer credit history

The longer you have a credit history and in use, the higher your credit score can be, provided you’ve managed it responsibly. If you manage your credit history effectively for a longer period of time, it may appear to lenders that you are a good credit recipient. Keeping old accounts open and in good standing helps build a strong credit profile, making you a more favorable borrower for lenders to give you credit at better interest rates.

5. Paying off loans on time

Build a habit of paying your loan EMIs on time to maintain a healthy credit score. Your credit score can be highly affected and go down if you’re not making on-time down balances, avoiding unnecessary debts and more. Timely repayments help you avoid unnecessary debt, reduce financial stress, and improve your chances of securing future credit.

Frequently Asked Questions

1. Why is a credit report important?

Credit report is an important aspect and plays a crucial role in your financial life. These reports serve as a tool for lenders to determine your eligibility for credit or a loan approval. The credit score in your report also affects the interest rates you’re offered.

2. How is my credit score calculated?

Credit score is calculated based on the information from your credit report. Each credit bureau uses different scoring models to calculate your credit score. Your payment history, the number and type of accounts you have, your credit utilization ratio and the length of your credit history are all factors that may affect your credit score.

3. Who is allowed to see my credit report?

Banks, insurers, potential lenders, mortgage lenders, auto lenders, credit card companies, car leasing companies, government, employers, landlords and others will want to see your credit report to assess your capability of managing your credit

4. Where do credit bureaus get their information?

Credit bureaus get their information from a variety of resources such as banks, credit card issuers, or utility companies. They also get information from property records, bankruptcies or court judgements against you if any.

5. How can I get a free copy of my credit report?

Equifax India makes it easier and convenient for customers to check Free Credit Report and Credit Score.You just need to follow these simple steps:

Create an account on Equifax India
Verify your identification details through one-time passcode (OTP).
⁠Authenticate yourself with details such as your date of birth, address, ID proof (PAN Card and Aadhar details)
On your dashboard, click on “Run your Free Report” to generate your free Equifax Credit Report

6. Why should I check the Free Equifax Credit Report?

Equifax credit reports have information about your credit history which is important to your overall financial wellbeing. Lenders and creditors use this report to decide whether you’re qualified to apply for any credit or loan.

7. What is a good credit score to have in a credit report?

Borrowers need to have a minimum score of 670 to be considered as a ‘good borrower’ for lenders. The easiest way to boost your credit score is practicing positive credit behaviour.

8. Does a good credit score guarantee loan approval?

Not necessarily. Having a good credit score does not guarantee loan approval. Greater the credit score, the better chances of getting an approved loan from lenders

9. How can I correct errors found in my credit report?

If you think your credit report contains incorrect or inaccurate information, you may dispute the information by filling out the Consumer Dispute Resolution Form by Equifax India

10. What type of inquiries Equifax reviews while generating credit reports?

There are two types of credit inquiries that you should know about: “hard inquiries” and “soft inquiries”.

Hard inquiries happen when lenders review your information in the Equifax credit report because you have applied for a new credit or loan.

Soft inquiries occur when lenders check your credit report for reasons such as employment verification, promotion or reviewing your own report.

Remember, hard inquiries can remain for up to two years on your Equifax credit report and it highly affects your credit scores.