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Tata Capital > Blog > Loan for Business > All You Need to Know about CRISIL Rating for Businesses

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All You Need to Know about CRISIL Rating for Businesses

All You Need to Know about CRISIL Rating for Businesses

The Credit Rating Information Services of India Ltd. or CRISIL is a global analytics company that rates businesses and provides risk and policy advisory services to organizations to aid in the smooth functioning of the market.

Simply put, CRISIL provides credit ratings for small and medium businesses (SMEs) and corporates.

CRISIL rating for businesses is a comprehensive process, involving the evaluation of business risk, financial risk and management risk of the firm in consideration. Let us understand these three terms in detail:

Business risk

While evaluating the business risk for a firm, CRISIL considers a list of several factors involved in industry risk. Besides that, it looks at the firm’s position in the market and evaluates how efficiently it operates.

Management risk

For management risk evaluation, CRISIL takes note of the competence of the firm’s management. It also takes into account the risk appetite of the firm and the integrity of the management system.

Additional Read: Business Loan without Collateral: Pros and Cons

Financial risk

While evaluating the financial risks, CRISIL assesses the accounting quality of the firm and the present and future financial position of the company. It also estimates the cash flows and the financial flexibility of an organization. Project-based risks are also considered.

After the risk evaluations, the overall CRISIL rating is decided after considering the support obtained by the business from a joint venture, a group or a parent.          

CRISIL has provided ratings to over one lakh MSMEs and businesses across sectors. These ratings and assessments have helped boost various businesses' performance by assisting them to get access to affordable finance. It is much easier for these enterprises to get a business loan approved if they have a good rating from CRISIL.

Want to Get Rated?

If you want your business to get rated by CRISIL, it will only take you three to four weeks to go through the entire process. The following steps show how CRISIL assigns a rating to a business:

  • The issuer requests for a rating.
  • The issuer signs the rating agreement provides the required information and pays the rating fee.
  • A rating team will be assigned from CRISIL, which will collect all information and conduct preliminary analysis.
  • There will be an interaction with the management.
  • The analysis will be presented to the rating committee.
  • A rating is assigned and is communicated to the issuer.
  • If the issuer accepts the rating, the rating will be released on the CRISIL website in the form of rating rationale.
  • The rating will be kept under surveillance during the tenure of the instrument.
  • If the issuer does not accept the rating, they might either appeal against the rating or the rating will be presented to a committee with at least one-third, independent members.

Additional Read:  All You Need to Know About CIBIL Score

To sum up

Now that you know, all about CRISIL business ratings apply for it and get your company rated! Alternatively, if you wish to expand your business before applying for this rating, get a loan at attractive business loan interest rates and flexible repayment terms with minimal documentation at Tata Capital. 

Besides, before applying, you can log on to our website to use our reliable business loan EMI calculator to check your potential monthly EMIs.

So, what are you waiting for? Get on our website, or give us a call, acquire about our relaxed business loan eligibility criteria and apply for business finance today!

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