A commercial CIBIL score on the credit report presents the credit behaviour of a commercial borrower. Commercial borrowers may be partnership firms, proprietorship firms, public limited companies, and private limited companies. Different details like the credit date and risk scores are written on the commercial CIBIL report. Such credit monitoring is done by the credit bureaus. They collect data from the lenders and creditors about the credit behaviour of the commercial borrowers and, based upon this, compute the commercial CIBIL score on the report. A higher score of over 750 may allow the business, i.e., the corporate borrower, to be eligible for different credit options.
CIBIL commercial report – features to be aware of
Major features of the CIBIL commercial report are –
· Credit history of the potential commercial borrower may be accessed easily.
· Lenders can easily access the report to understand the borrower’s financial responsibility and behaviour before making an ultimate decision.
· Risks are reduced, and lenders may lend with confidence.
· Lenders may get complete insights about the overall borrowings throughout different lending institutions.
· Credit may be processed and disbursed quickly.
The procedure for getting the commercial CIBIL report
The stepwise process to fetch the commercial CIBIL report includes the following –
· Go to the official CIBIL website, i.e., https://cibilrank.cibil.com/.
· Input the details linked with your business or company like name, type, ID value, GSTN value, contact details and address.
· On the terms and conditions section, select agree and next select submit and continue.
· On the second page, select the payment mode. Based on the plan selected by you, the amount to be paid may vary.
· Once you have made the payment, a registration ID and transaction ID will be mailed.
· KYC documents require being uploaded next. After the required KYC documents are uploaded, the CIBIL rank and CIBIL commercial report are sent to your registered address in 7 days.
Parameters that impact your commercial CIBIL report
Major parameters that impact your commercial CIBIL report are –
Company’s profile – Company’s size and life are factored in here. A sound financial check of the past repayment record is generally done. Note that sound financial record is often maintained well by bigger and older corporation. Thus, they hold higher chances of securing a loan or credit card if applied than the newer corporation due to their lesser exposure to credit and lower reliability by the lenders.
Outstanding dues – Any outstanding debt will impact the CIBIL commercial report negatively. Thus, it is important to keep just the feasible debts outstanding.
Payment history – The payment history of a company plays a major role in preparing the commercial CIBIL report. The commercial CIBIL report is impacted if you fail to pay your full EMIs timely.
CUR or credit utilization ratio – The CUR is a crucial parameter factored in by the lenders, which is mentioned in the commercial CIBIL report. In the case the CUR is on the higher end, the report may show a lower credit score of below 750.
Credit history – The length of credit history plays a major role in commercial CIBIL reports. The report is better if your credit history length is long.
How can commercial CIBIL scores be improved?
Here are a few of the ways to ameliorate your commercial CIBIL report. These include –
· You may opt for a long-term loan and repay it by the due date. This may assist in forming a good image in front of the lender.
· It is necessary to keep strict notes of the funds that your business receives and spends. This can assist in determining the loan amount you may need from any lender and the amount that your business must swipe through a credit card. Ensure to always repay the swiped amount through a credit card on time and in full. Also, ensure to maintain a lower credit utilization ratio of 30 per cent.
· In case there are any problems with your credit statement, you must get this corrected instantly. Correcting the credit statement may enhance your company’s fallen credit score automatically and make the company eligible for more credit options in the future.
· All the loan EMIs must be repaid in full and on time. Failing to repay on time may not just incur late payment penalties but also deem your company as less creditworthy, which would further lower creditors’ and lenders’ trust in your company.
Why is the commercial CIBIL report important?
Commercial CIBIL report plays a major role in getting your business loan approved, as almost all lenders evaluate your report before approving any credit application submitted by your company. This report shows your company’s past credit background and record and reveals the potential creditor or lender about your company’s behaviour with credit. Thus, a commercial CIBIL report is one of the strong indicators depending on which the lender or creditor decides whether to approve your company’s loan or credit card application. A strong commercial credit score can enhance your company’s chances of getting approved for credit.
Necessary documents required for checking your company’s commercial CIBIL report –
For private and public limited companies –
· Address proof – telephone or electricity bill, passbook or bank account statement, registered sale or lease agreement of the office premises, address proof issued by the multinational or commercial bank, or registration certificate issued under the shops and establishment act.
· Copy of board resolution with authorized specimen signature.
· Identity proof of the authorized signatories, i.e., through PAN card, passport or driving license.
· Company’s PAN card.
For partnership companies –
· Address proof – telephone or electricity bill, bank account statement, registered sale, lease agreement, etc.
· Copy of registration certificate or partnership deed.
· List of authorized signatories along with the specimen signatures.
· PAN card of the partnership firm.
· Identity proof of company partner – PAN card, passport or driving license.
· Address proof – registration certificate issued as per the shops & establishment act, electricity bill, etc.
· Identity proof of the proprietor – Passport, PAN card or driving license.
Note that the documents mentioned above must be self-attested by the proprietor. Self-attestation means duly signed with the date on every document submitted.