How to Increase CIBIL Score From 600 to 750

If you're planning to apply for a personal loan or any other financial product, one of the most important things to consider is your CIBIL score. A score of 750 or above signals responsible credit behaviour and can improve your chances of securing favourable loan terms. However, if your score is closer to 600, taking steps to improve it is highly recommended to expand your financial options.

Keep reading to find out how to increase your CIBIL score from 600 to 750.

Understanding the CIBIL Score

The CIBIL score, ranging from 300 to 900, reflects your creditworthiness based on your credit history. A higher score indicates a strong repayment history, making you more attractive to lenders. Key factors influencing your score include your payment history, amount of credit utilisation, length of credit history, types of credit accounts, and recent credit inquiries. Timely payments and responsible credit management are some of the best ways to increase your CIBIL score. Being aware of your CIBIL score helps you to make informed financial decisions, increasing your chances of securing loans with lower interest rates in the future.

How Does the CIBIL Score Work?

Here's a detailed overview of how the CIBIL score works, focusing on key components like payment history, credit utilisation, credit mix and duration, credit inquiries, and public records:

• Payment History: This is the most significant factor affecting your score. Timely payments on loans and credit cards positively boost your score, while late payments, defaults, or accounts in collections can severely impact it negatively.
• Credit Utilisation Ratio: This ratio measures how much credit you’re using compared to your total available credit. Ideally, keeping your utilisation below 30% demonstrates responsible credit management. High utilisation can signal financial distress, lowering your score.
• Credit Mix and Duration: A healthy mix of credit types—such as revolving credit (credit cards) and instalment loans (personal loans, business loans)—is beneficial. Lenders prefer borrowers with experience in managing different credit forms. The length of your credit history also matters; a longer history typically enhances your score.
• Credit Inquiries: Each time you apply for new credit, a hard inquiry is made, which can temporarily lower your score. Multiple inquiries in a short time may indicate credit-seeking behaviour, which lenders perceive as risky. Limit new applications to maintain a stable score.
• Public Records: Any negative public records, such as bankruptcies or court judgments, can significantly hurt your credit score. These records can remain on your report for several years, impacting your creditworthiness.

By understanding these factors, you can take proactive steps to increase your CIBIL score from 600 to 750 and enhance your financial opportunities.

How to Increase CIBIL Score?

You can follow the below steps to improve your CIBIL Score for a personal loan or other financial products:

Timely Bill Payments

Timely bill payment is one of the most important CIBIL score improvement tips. Paying your credit card bills, loan EMIs, and utility bills on or before their due dates demonstrates reliable financial behaviour. This positive payment history accounts for a significant portion of your score calculation. Even a single late payment can negatively impact your score, so it is important to prioritise timely payments. Consistently doing so helps build your creditworthiness, making lenders more likely to approve future credit applications. To ensure timely payments, consider setting up reminders or automated payments.

Lower Credit Utilisation

As mentioned earlier, ideally you should keep your credit utilisation below 30%. High utilisation can signal financial strain and may negatively impact your score. To lower your ratio, pay down existing credit card balances, avoid maxing out your cards, and consider increasing your credit limits responsibly. Additionally, spreading your expenses across multiple cards can help maintain a lower utilisation rate. By actively managing your credit utilisation, you demonstrate to lenders that you are a responsible borrower, which can lead to a significant boost in your CIBIL score over time.

Eliminating Debt

Eliminating debt is another crucial tip for improving your credit score fast. High levels of outstanding debt can adversely affect your creditworthiness, as they increase your credit utilisation ratio and signal financial strain. Start by prioritising high-interest debts and focus on paying them off systematically. Additionally, avoid accumulating new debts while working to pay down existing ones. Regularly making payments on time also contributes positively to your score.

As you reduce your debt levels, your credit utilisation decreases, and your financial health improves, potentially leading to a higher CIBIL score.

Diversifying Credit

A healthy mix of credit types—such as credit cards, personal loans, and mortgages—demonstrates your ability to manage different forms of debt responsibly. To diversify, consider applying for a small personal loan or a secured credit card if you primarily use revolving credit. However, ensure that you maintain timely payments across all accounts to positively impact your score.

Additionally, avoid taking on excessive new credit at once, as this can lead to hard inquiries and temporarily lower your score. A balanced credit portfolio can significantly boost your CIBIL score over time.

Regular Monitoring

By checking your report frequently, you can identify inaccuracies or discrepancies that may negatively impact your score. If you find errors, promptly dispute them with CIBIL to ensure your report reflects accurate information. Monitoring also allows you to track your payment history and credit utilisation, helping you make informed financial decisions.

Set reminders to review your credit report at least once a year or use credit monitoring services for real-time updates. Being proactive in monitoring your credit not only helps maintain a healthy score but also prepares you for loan applications and financial opportunities, ensuring you remain in good standing with lenders.

Keep Old Credit Accounts Open

Maintaining older credit accounts can positively impact your CIBIL score by contributing to your credit history length. A longer credit history shows lenders that you have experience managing credit responsibly. Closing old accounts can shorten your credit history and potentially reduce your score. Even if you don't use these accounts frequently, keeping them open and making occasional small purchases can help maintain a good credit mix. Just ensure you pay off any balances promptly to avoid interest charges.

However, if your old credit card has a high annual fee that outweighs the benefits of keeping it open, it might be wise to consider closing it.

Conclusion

Increasing your CIBIL score from 600 to 750 is achievable through consistent financial practices. Focus on timely bill payments and reducing outstanding debt to improve your payment history and credit utilisation ratio. Diversifying your credit mix and regularly monitoring your credit report will also help enhance your score.

By adopting these strategies and maintaining financial discipline, you can boost your CIBIL score and access better financial opportunities. At SMFG India Credit, a score of 750 or above is required to apply for a personal loan of up to INR 30 lakhs*. By meeting all eligibility criteria, you can unlock interest rates as low as 13%* per annum. Apply online today!