What is CIBIL Rank?
A CIBIL Rank is a number derived from the Company Credit Report (CCR) that summarises a business’s credit profile. The CIBIL Rank ranges from a scale of 1 to 10, with 1 being the best. However, the rank is available only for companies whose current credit exposure is up to ₹50 crores.
Just as CIBIL scores are given to individuals, CIBIL Ranks are assigned to companies. When assessing the creditworthiness of a company, lenders pull up the CIBIL Rank to make an informed lending decision. If the CIBIL Rank is between 1 and 4, most lenders consider the company as low risk. Primarily, two factors – credit utilisation and repayment behaviour – are considered to calculate a company’s CIBIL Rank.
What is a CIBIL Score?
CIBIL score is a number that signifies the creditworthiness of an individual. These scores are derived from the credit information of the individuals as reported by their lenders to CIBIL.
CIBIL uses various parameters to arrive at the final CIBIL score of an individual. Some parameters include repayment history, credit utilisation, number of secured and unsecured loans, etc. The CIBIL score is in the range of 300 to 900. A score of 750 and above is considered a good score; anything below that doesn’t reflect well on the individual’s creditworthiness.
What is the difference between the CIBIL Rank and the CIBIL Score?
The table below outlines the most significant differences between a CIBIL Rank and a CIBIL Score:
| CIBIL Rank | CIBIL Score |
|---|---|
| Applicable to companies | Applicable to individuals |
| Summarizes company’s CCR in one number | Summarizes the individual’s creditworthiness in a 3-digit number |
| Ranges from 1 to 10. A rank closer to 1 increases the company’s chances of securing a loan | Ranges from 300 to 900. A score closer to 900 increasing the individual’s chances of securing a loan |
| Only businesses with outstanding loans of ₹10 Lakh to ₹50 crores are eligible for a CIBIL Rank | Any individual with a significant credit history is assigned a CIBIL score |
FAQs
What is CIBIL MSME Rank?
CIBIL MSME Rank (CMR) is a robust model that risk differentiates borrowers in the smallest Micro segment with aggregate commercial credit exposure of fewer than ₹10 Lakhs to the Medium segment with aggregate commercial credit exposure of ₹50 Crores.
CIBIL MSME Rank is assigned to the MSME based on its credit behaviour, credit profile, and firmographics. This rank is on a scale of 1 to 10, with CMR-1 being the lowest risk MSME and CMR-10 being the highest risk MSME. The higher the CMR, the higher are the chances of default associated with the MSME. CMR helps lending institutions to make informed decisions and provide cheaper and faster credit to deserving, creditworthy MSMEs.
What is the CIBIL commercial report?
The CIBIL Commercial Report is a comprehensive and multi-dimensional credit file information on potential commercial borrowers (such as private limited companies, public limited companies, proprietorships, and partnership firms) that helps lenders make informed lending decisions.
What is CIBIL Company Credit Report (CCR)?
CIBIL Company Credit Report is a detailed document indicating the financial health of an organisation. The credit information in the report is received from different credit institutions. The CCR helps lenders make informed credit decisions.
What is the difference between the CIBIL Rank and a credit rating?
Businesses have been using credit ratings as their reputational collateral. These ratings are typically solicited by the ratee and then issued by the credit rating agency after evaluating the company documents and interviewing the company’s management.
The fundamental difference between CIBIL Rank and a credit rating is that the rank derives from objective information directly from the lenders (the CCR) as compared to information provided to a rater by a ratee.
How is the CIBIL Rank calculated?
CIBIL rank is calculated based on two major parameters: Repayment behaviour and credit utilisation.
Who can access CIBIL Rank and CCR?
CIBIL members can access CIBIL Rank and CCR. The CIBIL members include banks and financial institutions. The access is granted to them based on the principle of reciprocity, which means they need to provide all their data to CIBIL to gain access to CIBIL Credit Reports. Companies can also request access to their Company Credit Reports and CIBIL Rank directly from CIBIL.
Why is the CIBIL Rank not available for my CCR?
CIBIL Rank is given to companies with a current credit exposure of up to ₹50 crores. If you are not provided with a CIBIL Rank, it’s not a negative thing. It only means you are not eligible. However, you can evaluate your company’s credit performance based on your CIBIL Company Credit Report (CCR).
How can I rectify any incorrect information on my CCR?
The information in your CCR is based on the credit information provided to CIBIL by your lenders and banks. However, if you spot any discrepancy in your company’s credit information, initiate a dispute by completing an online dispute form available here.
