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Credit Information Bureau (India) Ltd (CIBIL) and TransUnion have launched the latest version of credit score to help credit institutions identify potential customers and better credit opportunities. The CIBIL TransUnion Score 2.0 will provide a risk index for consumers with less than 6 months of credit history. Consumers who earlier obtained a score value of ‘0’, owing to less than 6 months of credit history on their credit report will now be graded on a risk index ranging from 1 to 5, where 1 would mean highest default risk profile.
This helps credit institutions classify new-to-credit customers as high, medium or low risk. While customers with more than six months of credit history will be provided with CIBIL TransUnion Score 2.0 under a value ranging from 300 to 900, with 300 denoting highest risk of default. “The new scoring model has been developed keeping in mind the changes seen in the borrowing behaviour of consumers. “This will enable credit institutions like banks to predict risks more powerfully and make confident lending decisions, which in turn will help improve asset quality and credit penetration,” said Satish Pillai, Chief Operating Officer, CIBIL.
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