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Tata Capital > Blog > Loan for Business > What Is Company CIBIL Report?

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What Is Company CIBIL Report?

What Is Company CIBIL Report?

A Company CIBIL Report or a Company Credit Report (CCR) is a record of the credit history of your company. The Credit Information Bureau (India) Limited (CIBIL) maintains records of all credit-related activities of companies and individuals, including credit cards and loans. This report is created from data submitted by lending institutions all over the country.

Just like the individual CIBIL score, your company CIBIL score indicates your repayment capability. Suppose you want to apply for a business loan to expand operations. When you approach a lender, they will assess your company CIBIL report to determine your creditworthiness. A high score will increase your chances of getting approved for the loan. Whereas a low score might result in rejection or high interest rates.

What is CCR?

This report serves as a record of the past behaviour of a company and shows its financial health. Lenders typically look at this report before granting a loan to understand a company – the ownership type, its parent or subsidiary organisations, the number of years it has been operating, etc. Older and established firms have a better chance of having a good credit report compared to startups, simply because they have already proved to be credible.

Additional Reads – How To Get A Business Loan For Start-Up In India?

You can improve your company’s credit report by taking a few simple steps like:

  1. Having a longer credit history.
  2. Having a high credit utilisation ratio.
  3. Having no outstanding debts and having a record of timely repayment of loans.
  4. Avoiding credit card defaults.
  5. Checking your credit report for accuracy. Sometimes, lenders can make errors while sending the information to CIBIL which can hamper your company's CIBIL score.

The Company CIBIL Score is a 3-digit numeric summary of your company report, ranging between 300 and 900. The CIBIL rank is a number ranging from 1-10. While CIBIL ranks are only assigned to companies with current credit exposure of up to Rs. 50 crores, CIBIL scores are available for all individual consumers. Not having a CIBIL rank does not imply that the company is underperforming.

Additional Read – Check Out The Steps To Improve Your CIBIL Score to Get Business Loan

Components of Your CCR

Your company CIBIL report typically includes the following information-

  • Background information- The CCR begins by highlighting the background information of your company like ownership, parent and subsidiary companies, years of operation, etc.
  • CIBIL rank- This is similar to the individual CIBIL score and ranges between 1-10. The closer your CIBIL rank is to 1, the better your credit health.
  • Financial Details- The report also highlights important financial information about your company that determines the maximum credit that lenders can extend you.
  • Financial History- This includes your past financial details like repayment patterns, revenue generation, etc. that help lenders determine your creditworthiness and repayment capacity.

How to check company CIBIL score

The two main parameters that are used to check company CIBIL credit scores are repayment behaviour and credit utilisation.

Good credit habits and timely repayments can help in improving your CIBIL credit scores. Here are a few other points you should keep in mind if you want to improve your CIBIL score:

  • Keep track of your credit score so that if there is any issue or negative information, you can get it fixed.
  • Never cross credit limits and keep an old credit card with good records to improve your CIBIL score.
  • Do not apply for too many loans, since loan rejection negatively impacts your credit score.

Your company CIBIL report also keeps track of personal loans besides business loan. Your credit report includes all your transactions or defaults irrespective of the personal loan closure route you take. You must make sure that your lender updates the details to CIBIL after the closure of your loan. That serves as a basis for your CIBIL score evaluation. It would surely help you close the personal loans faster if the repayment options for the loans were flexible.

For a company to survive and flourish, having a good CIBIL report with decent scores is of utmost importance. It takes about 4-5 months of careful financial planning to improve your credit score, so start working on it today.

To conclude

If you’re looking for easy, collateral-free business loans with attractive business loan interest rates, get in touch with Tata Capital today.

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