CIBIL Is Important For NRI, In Or Out Of The Country
NRIs or Non-Resident Indians form a major part of the Indian population. These are the people who reside in some other country, apart from India, for many reasons. One of the major reasons for this is that people move abroad for pursuing better growth opportunities.
But, when it comes to the finances of an NRI, everything becomes a bit complicated, especially if you do not know much about the financial terms or rules. One of the things that worry NRIs is their credit score. As they are living in a foreign country, they would deposit their savings and income in a foreign account.
Moreover, their credit card would also be of a foreign country, in which they are residing now. And, for this, they would have a FICO score (in case of USA), which is recorded by any of the three credit reporting agencies, including Equifax, TransUnion, or Experian.
Till this, it is fine. But, the problem arises, when an NRI wants to apply for a loan in India. It can be a home loan for a property he or she is buying in their home country. It can be a personal loan for their family members staying in India, an education loan for their kids studying in India, etc. No matter what the reason is or what type of financial link the NRI has in India, it is imperative that they should check their CIBIL report.
Why? It is because the loan providing company checks their CIBIL report. As simple as that! And, you may wonder why this is so. It is because the NRI is seeking a loan in India, due to which the loan providing company will check the CIBIL report of the NRI. If the Non-resident Indian wants a loan in the country in which he or she is residing, say like the US, then their FICO report will be evaluated.
Sometimes, the bank sees both the CIBIL as well as the FICO report of the NRI in order to get an idea about the credit behavior of the NRI both in India as well as abroad. Now that you know that an NRI’S CIBIL report is evaluated by the financial institutions, it is important that he or she should check their CIBIL report regularly.
Why NRIs should check their CIBIL reports?
The Most Important Reasons
• A CIBIL report includes the credit behavior, history, and payments of the person. Depending on this, they are given a score between 300 and 900. Therefore, in order to check how you are doing in your credit behavior and what your credit score is, you must check your CIBIL report, even if you are residing in a foreign country.
• NRIs must check their credit reports for any discrepancy of data or any error done on the part of the company issuing the report. In case, you see such an error, no matter how small it is, like a wrong address or any other type of error, you must get it rectified immediately, as it can ultimately affect your CIBIL report.
• In case an NRI wants to get a loan in India, then their CIBIL report will be evaluated. So, by checking their CIBIL report, NRIs can know where they stand and whether they can get a loan in India or not.
• NRIs should check their CIBIL reports, so that their loan application is not rejected.
• If you are a guarantor of your friend or relative, who is residing in India, then you must check your CIBIL report. As a fact, he or she could have failed to pay back the borrowed money and as a result your CIBIL credit score will get affected by it, even if you are residing abroad. Thus, as an NRI, you must check your CIBIL report to check if it shows any such inconsistency in loan repayment.
• If you are working overseas and have parents residing in India, it is likely you have provided one or two supplementary credit cards to them. And, by chance or due to age if they do not make the outstanding payment on their credit cards on time, then it will affect your CIBIL report, as you are the primary cardholder. In such a case, you can instruct the bank to pay off the overdue balance directly from the saving account on the due date, which in turn will eliminate any chances of lapse.
• A fraudster can steal your identity and in your name they can take loans from banks. In such a case, the cheat will definitely not pay back the money, thus affecting your CIBIL report.
These may be some of the reasons why NRIs should check their CIBIL reports. All of these reasons sum up to the necessity that CIBIL reports must be checked by you, even if you are residing out of India. Moreover, if you have any financial interest in India or in case you return back to India anytime, then a healthy CIBIL report would be a great financial foundation for you.