In the world of finance, one thing that impacts individuals a lot is their credit score. Just like your academic performance was judged in your school years, similarly your financial performance is also judged and evaluated. While you used to get a report card in school that contained your grades, you also get a similar report card that reflects how good or bad you have been in handling your finances, particularly credit. This is called a credit report.

Instead of grades, your credit report contains a score which is called the credit score. Sometimes it might be referred to as the CIBIL score but they are the same thing. This score tells of your habits such as how many credit enquiries you have made in a given period of time, how much of the total available credit you have used, how regularly you repay your outstanding dues and if you do it on time or not, etc. Banks and other financial institutions use an individual's credit score to judge their creditworthiness. In other words, your credit score tells lenders whether you are financially responsible. This helps them decide whether to provide you with credit (loans, credit cards, etc) or deny it.

In India, the responsibility of calculating the credit score of people has been handed over to what are known as credit bureaus or Credit Information Companies (CICs). There are four such credit bureaus in India - TransUnion CIBIL, Equifax, Experian and CRIF Highmark. While all four of these bureaus perform similar functions, slight differences are worth discussing. Let us look at Equifax's Credit Score Vs CIBIL Credit Score.

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Equifax Credit Score Vs CIBIL Credit Score

Equifax and TransUnion CIBIL are prominent credit bureaus in India and enjoy a good reputation. While they perform similar functions, there are still slight differences that must be noticed.

Foundations and Background

With its headquarters in Mumbai, CIBIL (Credit Information Bureau India Limited) was founded and set up in the year 2000. Its shareholders are Trans Union International Inc., Aditya Birla Trustee Company, IIFL, Bank of India, UBI, IOB and India Alternatives Private Equity Fund. While Equifax is a renowned global credit bureau founded in the USA, Equifax India is a slightly younger credit bureau and was established ten years after CIBIL in 2010 in a joint venture between Equifax Inc. USA and seven prominent financial institutions of India - Kotak Mahindra Prime Limited, Bank of India, Bank of Baroda, Religare Finvest Limited, State Bank of India, Union Bank of India and Sundaram Finance Limited. The headquarters of Equifax are also located in Mumbai.

This difference matters because any desire to access credit history prior to 2010 can be accessed only through CIBIL. Equifax can provide records only for 2010 and later. Also, since CIBIL is a decade older than Equifax, its network of partner financial institutions, banks and clients is obviously larger.

Read More:: Increase Your CIBIL Score from 600 to 750

Which One of the Two is More Expensive?

Every year, all individuals in India are entitled to one free credit report from each credit bureau. However, if you wish to access your credit report multiple times in one year, then you have to pay the credit bureau. This fee to check your credit report differs for each of the bureaus.

Out of CIBIL and Equifax, CIBIL is a more expensive credit bureau. CIBIL charges consumers somewhere around INR 550 whenever they wish to get their credit report. On the other hand, Equifax has a fee of INR 138 for people who want to get their credit reports. So, in case you are looking for a more economical option to have a look at your credit report, Equifax is your go-to choice. It also adds up if you keep regular track of your credit reports and do not look at them just once annually.

There is also a difference between the payment methods on the websites of CIBIL and Equifax while checking your credit report. CIBIL allows net banking as well as debit and credit card payments. If you are planning on obtaining your credit report from Equifax, then the only available mode of payment for you is a demand draft.

Read More:: Is a 750 Credit Score Good?

Method of Checking the Credit Score

Credit bureaus, CIBIL, and Equifax allow consumers to check their credit scores on their official websites. However, there is still a little difference in the method to be followed.

The process of checking credit reports on the official CIBIL (www.cibil.com) website is comparatively quicker and easier. To check your credit report on the official CIBIL website, you only have to register (if you are a new user) or log in (if you are a returning user) and answer some basic questions that would include personal information such as your full name, date of birth, email ID, and phone number. Then you just have to upload a government approved ID (out of the available ID options on the CIBIL website), for instance, your PAN card. Once all this is done, you will be given access to your credit report.

If you choose Equifax to check your credit score, the process might take a little more time. This is because consumers must first fill up a KYC form carefully. They are also required to provide self-attested residence and identity verification.

On the CIBIL website you can get your credit report whenever you wish to. Equifax offers its consumers four credit reports per year. The annual subscription plan of Equifax costs INR 1000. With this subscription plan, you get your credit report quarterly.

Read More:: Credit Score Vs CIBIL Score

The Credit Score: Is There a Difference?

No matter which Indian Credit Information Company you choose to look at your credit score, it will always range between 300 and 900. An individual's credit score cannot be below 300 or over 900. So what's the difference between getting it from CIBIL And getting it from Equifax? First of all, there might be a slight difference in the credit score of the same person when generated from these two different bureaus. However, this difference is most often not very significant. If you notice a variation of more than 50 points, then there is a possibility of an error or a discrepancy. In such a case, you must file a complaint instantly with the concerned credit bureau.

This difference between the scores generally happens because CIBIL and Equifax use different parameters to judge and weigh your credit behaviour. In other words, the scoring model of these credit bureaus differs from each other.

Resolving Disputes

Sometimes, you might notice that there is some error or discrepancy in your credit report. It could be the above-mentioned issue of a significant variation in your credit scores from different credit bureaus or something else. For instance, a written-off status might be under one of your closed accounts. Whatever the issue, it is imperative to resolve it as soon as possible. Here is how you can file for dispute resolution with CIBIL and Equifax:

CIBIL - In case of a grievance, you can file a dispute online on the official CIBIL website. You will easily find a form for the said purpose. Carefully fill in the required personal information and hit submit. It can take anywhere between 30 to 45 days for the mistake to be corrected and reflected back on your credit report.

Equifax - A Dispute Resolution Form is available on the official Equifax website. You need to download it and fill it up correctly with the required information. Once done, you have to send the form and any required documents to the address mentioned on their website.

Read More:: What Happens If You Default on Your Credit Card

Conclusion

Your credit score says a lot about your financial health. It is advised to keep a regular check on your credit score to ensure you are always eligible for services such as loans and credit cards. The better your credit score is, the more benefits you can enjoy. Four credit bureaus in India are entrusted with the responsibility of calculating the credit score of all individuals. These are TransUnion CIBIL, Equifax, Experian and CRIF Highmark.

While all of these Credit Information Companies perform similar functions, there are still some differences between each of them. Both CIBIL and Equifax are highly reputed credit bureaus in India. However, CIBIL is a decade older than Equifax. The credit score generated by both of them could be a little different for the same individual. This happens because the parameters for judging and scoring a person's credit usage and behaviour are different for both bureaus. Other differences between the two include a slightly varied method of checking the credit score, a difference in fee for getting your credit report (Experian is quite cheaper compared to CIBIL) and some variation in how you can approach the two for dispute resolution.

Despite these differences, you must keep in mind that both CIBIL and Equifax are highly reputed and trustworthy credit bureaus, and one cannot be claimed to be better than the other.

Frequently Asked Questions (FAQs)

1. Are CIBIL and Equifax the same?

Both CIBIL and Equifax are Indian Credit Information Companies. However, both of them are not the same company. TransUnion CIBIL was established in 2000, whereas Equifax came a decade after it and was set up in 2010.

2. Is CIBIL better than Equifax for checking credit scores?

Whether CIBIL is a better credit bureau to check credit score or Equifax cannot be said. Both of these are highly reputed and trustworthy credit bureaus with only slight differences in their methods and scoring models.

3. Will I get a higher credit score on CIBIL or on Equifax?

While there could be some variation in your credit score generated by CIBIL compared to Equifax, one should not be significantly different. A difference of upto 50 points is possible, but it should not be more than that. This difference can arise because both credit bureaus' scoring model and parameters are slightly different. It cannot be said which one of them will generate a higher credit score.

4. Is it free to check my credit score on CIBIL?

You can check your credit score for free on the official CIBIL website. However, it must be noted that every individual in India is entitled to just one free credit report per year by each credit bureau. So, if you wish to check your credit report more often, you must get a paid subscription plan on their website.

5. Should I get a credit report from both CIBIL and Equifax?

Getting a credit report from both CIBIL and Equifax is a good idea. The reason is that both these credit bureaus use different parameters to judge your credit behaviour in the past and generate your final credit score. When you get a detailed credit report from CIBIL as well as from Equifax, you will be able to understand any shortcomings in your financial behaviour much better. You will have a more comprehensive understanding of areas that you could work on in order to improve your credit score.

6. How much money do I need to pay in order to get my credit report from Equifax?

Anyone who wants to get their credit report from Equifax needs to pay only INR 138. Equifax is quite cheap when compared to other credit bureaus in India. For instance, CIBIL charges its consumers INR 550 to provide them with a detailed credit report. This is more than double the amount charged by Equifax.

7. Can I change my credit score?

Yes, you can change your credit score. However, this change will occur over time and not instantly. To improve your credit score, you must adopt good financial habits such as timely repayment of loans and credit card bills, keeping a healthy mix of credit, ensuring that your credit utilisation ratio is as low as possible, and making credit enquiries only when needed.