RBI New Rule! Your credit score will now update weekly
Big news for those who use a credit card, pay EMIs, or are considering a new loan. The Reserve Bank of India is making major changes to make the country’s credit structure more robust and transparent. Your credit score will now be updated every seven days, not just once a month.
This move will bring relief to millions of people whose loans were stuck because banks waited for the latest update on their credit scores. Now, as soon as you pay an EMI, clear a credit card payment, or take out a new loan, the record will be added to your report that same week.
What has changed in the RBI’s new proposal? Until now, banks and other financial institutions were required to submit data to credit bureaus like CIBIL, Equifax, Experian, and CRIF Highmark once a month or fortnightly. However, under the new draft guidelines, this reporting will now be mandatory weekly. Banks will send data to the bureaus on the 7th, 14th, 21st, 28th, and the last day of each month. This will ensure immediate records of your financial activities, such as EMI payments, credit card bills, new accounts, outstanding balances, or account closures. Furthermore, only the data that has changed will be sent with each update, making the process faster and smoother.
What benefits consumers?
Your score will improve faster: You won’t have to wait two or three weeks after paying your EMI or bill.
Loans will be approved faster: Banks will see your current profile, speeding up the approval process.
Reduce the chance of errors: Data will be constantly updated, making it easier to correct old errors.
Improved credit health: The impact of timely payments will be immediately visible.
Major benefits to banks and financial institutions: Banks will now have more accurate and up-to-date customer data. This will reduce the risk of default, strengthen credit appraisals, make fraud detection easier, and speed up the loan disbursement process.
What is a credit score? It’s a three-digit number between 300 and 900 that indicates how responsible a borrower you are. The better the score, the greater your chances of getting a loan.
