How much required CIBIL score For best business Loan 1 Cr.

CIBIL score plays a very important role while taking a loan.
People face a lot of problems while taking a loan due to CIBIL score. The score should be between 300 to 900 in which 750+ is the score.

Let us understand why score is important.

1. Any bank, NBFC first checks your score before giving a loan, which shows how your financial management is.
2. CIBIL score of 700+ is considered good for business loan so that you can be easily selected for a business loan.
3. Only with a good score can banks and NBFCs sanction cheaper interest rates and higher loans for you.

What else do banks look at before giving a business loan

First of all, when you apply for a business loan, by visiting the branch or through online, then the banks / NBFCs go to the address given by you and understand the business thoroughly, see if the place where your business is located is risky or not, how much is the goods in your shop or stall, then they see some photocopies of the goods purchased by you, which makes it convenient for the bank employee to a great extent to grant you a business loan.

Difference between bad CIBIL score and best CIBIL score

• NILL or -1 = NA — This means that you have never taken any loan from any financial institution, your financial dealings are not known to anyone yet. On a Nil or -1 score, you may be offered a small loan amount initially or it may not be. If you also have a Nil or -1 score, then first of all you can buy an electronic item and slowly change your score.
• 350 to 549 = Poor — This CIBIL score is called a bad score because it means that you have taken a loan from financial institutions but have not repaid them on time. You should apply for a business loan only after improving it, otherwise your business loan application will be rejected due to your bad CIBIL score, and you will not be able to get the money on time.
• 550 to 699 = Average — The average score is also not a very favorable score. It shows that you might have defaulted on the previous loan due to which the score has decreased. You have to improve your score to get a loan at a lower interest rate. Some financial institutions give business loans but at a higher interest rate.
• 700 to749 = Good —This is a good score, with this you will get business loan easily and will also get cheaper interest rate.
• 750 to 900 = Excellent — This is the best credit score you can have. You can negotiate lower interest rates and get a business loan on the most favorable terms. You can get a higher business loan amount at relatively lower interest rates.
• Click here to check score.

While making a Business loan application, if you have a poor CIBIL score, it might be because of the following:

1. Loan or credit card dues: In case you haven’t repaid any loan or credit card amount on time, it reduces your score.
2. Regular application for loans: If you continuously apply for loans, it decreases your cibil score too.
3. Heavy usage of credit cards: Exceeding your limit is also harmful to your cibil score.
4. Incorrect information: In case there is any incorrect information in your credit report, that too can bring down your score.
   

Note–

You especially need to keep in mind that before taking a business loan, you must always keep an eye on your CIBIL score, otherwise you will face difficulty in getting a business loan or any other loan, therefore, you will have to keep paying the EMI on time to the bank or NBFC from which you have taken the loan, otherwise your financial needs will never be met on time by the financial institution.

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