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How to Build a Credit Score from No Score

How to Build a Credit Score from Zero


  • When credit score is 000, it means Credit History is not available
  • Simple Methods to jumpstart your Credit Score

In the latest monetary policy meet held on March 24-27 2020, the RBI has decided to give a 3-month moratorium period for all outstanding loans as on March 1, 2020. Remember, this is not an EMI WAIVER. The move is in line with the economic pressures induced by the Coronavirus outbreak. So, this could mean some savings for you on your loan and help you deal with the likely situation of less or no income. Your credit score will not reduce if you don't pay the EMI. But doing so can raise your interest liability as banks would like to cover their losses, which is likely to be the case on deferred EMI payments, by increasing the interest component of the EMI after the moratorium period gets over. So, if you have the money, keep paying to reduce your interest liability. The moratorium, which was ending on May 31, 2020, has been extended till August 31, 2020.

Many of us come face-to-face with our credit score at some point in our lives. Well, those who have already been on a financial journey would surely agree with that, right? No matter what sort of loan/credit card you want to avail, your three-digit numeric history is always viewed with a keen interest by the lenders. And, why not, after all, it represents the creditworthiness of an individual that prompts lenders to decide whether to offer loan/credit card or not.

But what about those with no credit history? If you’ve never had a credit card or loan, your credit history is most likely a blank slate. And, no credit history means no record of how you might manage the debt and as a result, such people can face the loan/credit card rejection. A score of 0 on a CIBIL credit report means Credit History Not Available (NA) which indicates that the credit history is less than six months which is not sufficient to give a credit rating between 300 and 900. But don’t be disheartened as everyone starts out with a blank slate when it comes to building a credit score. We bring to you some simple methods that can help you in attaining an excellent credit score over time.

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So sit back and relax as we are here to help. All you need to do is just read the post below.

Secured Credit Card

There are high chances that in the absence of a credit history the lenders won’t give an unsecured card that appeals to you, which is easy to avail without any collateral or security. But don’t lose hope as you have the option of a secured credit card. That’s Right! A secured Card is an ideal option to avail as far as building a credit score is concerned. There are many lenders out there who are known for offering these cards against a fixed deposit of a specific amount. For example- SBI Unnati Credit Card and ICICI Coral Credit Card Against Fixed Deposit are the few options you can consider.

Bike Loan/Personal Loan

No credit history?No worries as in that case also you can avail a loan to build your credit record. Surprised to read that? Well, you read it absolutely right! If you are having a salary account my friend, the same can work in your favour. The corporate salary account holders stand a great chance to get the loan approval even if they do not have a credit score. Yes, based on your past record or good terms with the bank, you can either apply for a bike loan or a personal loan. Both these loans come with flexible tenure options, thus are easy to repay. The beginners can opt for these loans to establish their credit history as there will be no hassle in availing them from the bank in which you are having a salary account for the past 1-2 years.

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Employees of Renowned Companies with Good Income

Individuals working in renowned companies along with a good monthly income have fair chances of getting a loan or credit card easily even with a zero credit score. Many lenders prefer such employees who work in CAT A, or CAT B companies as it comes with a reliability and surety as far as loan and credit card repayment is concerned. In fact, many lenders also give special credit and loan offers to such corporate employees.

Savings Account Holders

Another great option that can help generate your credit score is none other than your savings account. Yes, if you are an existing customer of a bank and has been maintaining a savings account for the last 1 or 2 years, chances are higher that you can get a loan or a credit card from the same. In such a case, your fruitful relations and past record will work in your favour.

Always remember that establishing a credit score from scratch doesn’t happen overnight. Have some patience and work with the right strategy by following the above measures.

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Personal Loan Interest Rates July 2020
Fullerton India14.00% - 33.00%
HDFC Bank10.75% - 21.45%
ICICI Bank10.99% - 18.49%
IndusInd Bank11.25%
Kotak Bank10.99% - 20.99%
RBL17.50% - 24.00%
Standard Chartered Bank11.50% - 18.00%
Tata Capital10.99% - 18.00%
Home Loan Interest Rates July 2020
Axis Bank7.75% - 8.55%
Bank of Baroda6.85% - 7.85%
HDFC6.95% - 8.00%
ICICI Bank7.45% - 8.55%
Indiabulls Housing Finance Limited8.80% - 11.05%
Kotak Bank7.40% - 9.70%
LIC Housing7.40% - 8.85%
Piramal Capital & Housing Finance9.00% - 9.10%
PNB Housing Finance8.60% - 9.45%
Reliance Home Finance8.75% - 14.00%
State Bank of India/SBI6.95% - 7.60%
Tata Capital9.20% - 9.35%