High CIBIL score after settlement, loan rejected

I have a score of 700+ on CIBIL (I had taken out a report on my own by paying online at CIBIL). My recent application for a Personal Loan at ICICI Bank was rejected. The reason given to me that there is a settlement in my account that happened some time back. because of this, my loan has been rejected.

Is this possible? Isnt credit score the only indicator banks look at for evaluating a profile? How can an old settlement case be reason for loan rejection when my score is so high

Credit Card Application rejected due to CIBIL Score

Has your Credit Card Application been rejected due to low or bad CIBIL score?

Dont't worry. You are not alone to be experiencing this. In fact most banks in India have confirmed that one of the major reject reasons for applicants seeking a Credit Card is low or no Credit Score (CIBIL Score).

If your Credit card or loan application has ever been rejected, share your experience with us here.


Credit bureaus in India

Credit Bureaus in IndiaIndia is home to multiple credit bureaus including CIBIL, Equifax.

Advantages of having multiple credit bureaus in a country

A recent RBI directive has ensured that every bank in the country will have to submit the consumer data to all the 4 bureaus. While this may sound like an increased overhead at the bank's end, it is interesting to also understand why the regulator would have insisted on doing so. While each bureau has its own black-box model for building their scores, the fact that there are 4 different scoring models will definitely help in building confidence at the lenders end.

Banks can now avoid both types of errors i.e. classifying bad loan seekers as good and classifying good loan seekers as bad. If a majority of bureaus have the same classification for the consumer, the bank's staff can be assured that the chances of a wrong decision due to a poor model are low.

CIBIL report – What does it contain?

CIBIL is a Credit Bureau authorized to operate in India. It was the first credit bureau and as a result now CIBIL report is a term used generically for all bureau reports in India.

CIBIL ReportCIBIL collates the information submitted by banks and other lenders and generates the CIBIL report. CIBIL is allowed to share your CIBIL report with banks when you seek new loans or with banks who have given you a loan already.

You can also get a copy of your CIBIL report directly.

If you were to get a copy of your CIBIL report then it will contain the following details:

  • CIBIL Score provides information on your score as well as tell you the % of loans sanctioned in last 1 year for borrowers whose CIBIL score equal or more than your score.
  • Personal Information –
    • Name
    • Date of Birth
    • Gender
    • ID document details like PAN / Voters ID / Aadhar / Passport etc.
    • Contact details – only latest 4 addresses and email ID are shown in the report
    • Address – residence and office
    • Telephone numbers – residence / office / mobile
    • Email
  • Employment information – details related to occupation and income are available
  • Loan / card
    • Account details
    • Name of the Bank / Lender from which the loan is availed
    • Loan start date
    • Original loan amount
    • Loan amount outstanding
    • Repayment history for upto 36 months – this information is available with CIBIL for every month since you started the loan, though only latest 36 months details are displayed
    • If loan is closed / paid off
    • Whether the loan was settled or written off- you could not pay the dues or if you asked the bank for a rebate If the loan is in your name only or is jointly taken Information about guarantees that you may given for someone else's loan are also shown in your report
  • Enquiry information

Unlike developed nations the credit bureaus in India do not have information about utilities like phone, electricity etc., and insurance payments. Currently CIBIL only has the information provided by banks.

This is the situation right now, but over time even this information is expected to become part of the data available with the credit bureaus. This report is like a financial report card for an individual. It has very sensitive information and is a private document that needs to be guarded closely.

Where does CIBIL get my data ?

CIBIL DataCIBIL or other credit bureaus are repository of information, where by they store and disseminate information about credit behaviour of borrowers.

While they may seem like God to know a lot about you (just take a look at what all your CIBIL report contains) and affecting you in your financial matters, the information contained in the bureaus is all based on data submitted by banks and other such institutions.

Every month or even more frequently banks submit information about your loans to CIBIL and other credit bureaus. In this data submission not only details of your loans like timely repayment and amount outstanding are shared but information about address, phone numbers etc also shared. Apart from this when you apply for a new loan then the bank enquiries about you with the bureau to find out your details.

At that time the information submitted to the bureau like name, DOB, address and phone numbers along with loan type (Personal loan, credit card etc.) and amount of the loan you applied for are also saved by the bureau and updated to your profile.