Our credit history is the record of how we have managed our debts, limits, financial associations, payments and delays over a period of time reported to various credit information companies. Credit history is ranked by a score and ranges from 300 to 900. Popular credit monitoring agencies are Equifax, CIBIL, Experian, CRISIL, ICRA and CRIF and are regulated by SEBI — securities and exchanges board of India as per law.
A typical credit history details how many financial inquiries has been made on your behalf, negative actions of your financial relations with lenders, bill payments, bankruptcy, settlements, any liens and holds. Most agencies arrive at a score based on various algorithms that predicts your credit worthiness. A good credit history and high score makes it easier for you to obtain credit, while a bad credit history/score may prevent you from borrowing or significantly reduce your options.
In this techno centric age, our personal identities have expanded to include biographic, demographic, behavioural, religious, political, financial and social information of a person. All these bits of information makes up our personality. Employers, embassies, businesses, bankers, friends, families and even politicians are tapping into this data mine as we find jobs, establishing credibility, securing visas, make purchasing decisions, obtain debt, reach out socially, find romance and even vote.
Your credit score and history is imperative for your independent adult life. Most Indians are waking up to these new requirements slowly. With businesses wanting to stay competitive the adoption of technology like AI based decision making is driving cut throat methods in many areas. The day is not far off when our personal data is contained and processed more in the chips of these computers than our brains.
As an expressive society we must ensure to adapt to these dynamics of new age social change and build a good history and score for our financial independence. A few tips I suggest as follows:
- Always be honest
- Maintain updated information of all aspects
- Secure your identity on all dimensions
- Stay politically correct
- Keep religious views personal
- Pay bills on time
- Exercise financial prudence
- Save money
- Be accountable and responsible
- Don’t live in the web
- Be aware of identity thefts
- Maintain individuality
- Don’t rush to express anger
- Keep records of everything