Khyati Dharamsi

Mumbai: Have you ever been denied a loan or a credit card, by a bank, on the pretext that you have a ‘bad credit history’? If you have, you have a right to ask the bank for the data based on which it took that decision.

As per law, if a bank denies loan or credit card application on the basis of data provided by a credit bureau, it is supposed to give you a copy of those records.

However, before you are handed over the report, you may have to prove that you are the person whose credit report is being sought. So, carry an identity proof and address proof with you.

Remember, nobody else, not even your kith or kin, would be handed over your report. Nor can you get it without having applied for a loan or a credit card.

The way it works, credit bureaus maintain records of your borrowing history with all the banks you have transacted with. These include details such as your permanent account number, the addresses you have notified banks about, number of credit cards you hold currently or have held in the past, loans you have taken, the period within which you have repaid or whether you have not repaid and for what period you have not repaid.

Presently, the Credit Information Bureau (India) Pvt Ltd (Cibil) maintains such records and provides it to all its 147 members,who in turn keep the database updated. As and when a person applies for a loan or credit card, the member banks would check with the Cibil database.

The system would also throw up details such as the last time any bank checked for your credit records. This indicates the last time you applied for a loan with any bank, as banks are not supposed to check the Cibil database unless they receive a loan or credit card application.

Banks are barred from checking the records for marketing purposes. Moreover, each time they check the database, it costs them money, according to a banking source.

As for the cost to the individual, a random survey by DNA Money found that some banks charge between Rs 50 and Rs 300 for furnishing credit reports. Cibil is currently working on a system whereby you can get your credit report against a payment of Rs 100.

If you find any discrepancy in the data maintained by Cibil on you, then inform the bank and take up your case with Cibil. However, note that you would need the credit report as a proof to even take up the case. So keep your copy safe.

Source : DNA