Different Types of Credit Scores: Why They Exist and How They Matter

A credit score is a three-digit number that reflects your creditworthiness. In India, it plays a crucial role in loan approvals, credit card eligibility, and even rental agreements. While many assume there is only one credit score, the reality is more layered. 

Multiple types of credit scores exist, each derived using different methods by various credit bureaus. Understanding why they differ and how they influence financial decisions is key to managing your credit profile effectively.

What Is a Credit Score

A credit score summarises your credit behaviour into a numerical format. In India, these scores typically range from 300 to 900. The higher your score, the more creditworthy you appear to lenders. Scores are calculated using data from your credit history—such as repayment records, loan types, and usage of credit limits. A score above 750 is generally seen as favourable for most financial products.

Why Are There Different Credit Scores

Different credit scores exist because multiple RBI-approved credit bureaus operate in India. Each bureau collects data independently and uses its own scoring model. Lenders also provide and access data differently from each bureau. For example, a loan closed with one lender might appear sooner in one report than another. This leads to slight variations in the score.

Additionally, each bureau weighs factors like repayment history, credit mix, and credit age differently. As a result, two scores for the same person can differ, even if based on similar data.

Key Types of Credit Scores in India

India currently has four primary credit bureaus that offer consumer credit scores:

CIBIL Score

Maintained by TransUnion CIBIL, this is one of the most commonly used credit scores in India. It ranges between 300 and 900. Most banks and NBFCs consider the CIBIL score when evaluating loan applications.

Experian Score

Experian India also offers credit reports and scores, approved by the RBI. Like CIBIL, the score ranges from 300 to 900. Some lenders use Experian exclusively, while others use it in combination with CIBIL.

Equifax Score

Equifax India is another RBI-licensed bureau. Its credit reports contain detailed account histories and scores within the same range. Equifax’s analytical models are slightly different, which can cause a variation in your score.

CRIF High Mark Score

CRIF High Mark provides credit reports for individuals and businesses. It is popular among cooperative banks and microfinance institutions. Again, scores fall within the 300–900 range but may vary due to differing data processing methods.

These credit scores all aim to assess your repayment capacity. However, the differences in calculation methodologies, data collection, and update frequency lead to variations.

How to Check and Monitor Your Credit Score

It is advisable to monitor your credit score regularly. This helps detect errors, track improvement, and avoid surprises during loan applications.

You can check your CIBIL score for free once a year from the official CIBIL website. You can also get scores from other bureaus directly or through financial service platforms.

Inaccuracies in credit reports are not uncommon. If you notice any errors, such as an unpaid loan that was actually cleared, you should raise a dispute with the respective bureau.

For a more convenient approach, platforms like Bajaj Markets allow users to view and track credit scores from multiple bureaus. This gives a broader view of your credit standing and helps compare reports easily.

How Credit Scores Are Calculated (and Why They Differ)

Credit bureaus consider five key factors when calculating your score:

• Repayment history (accounts for about 30–35%)
  
  

• Credit utilisation ratio (how much of your credit limit you use)
  
  

• Length of credit history
  
  

• Type of credit used (secured vs unsecured)
  
  

• Number of credit enquiries

While these components are common, the weight each bureau gives them varies. For example, one bureau may weigh credit utilisation more heavily, while another may focus on payment history.

The timing of data updates also causes variation. If a lender reports new information to one bureau sooner than others, your score with that bureau could change earlier.

Do Different Scores Impact Your Loan or Credit Card Approval

Yes, different scores can affect your approval chances, but usually not significantly. Most lenders rely on a preferred bureau. Some may cross-check multiple reports if the credit amount is large. If one score is lower, it could result in stricter terms or even a rejection.

However, a difference of 10–20 points between scores is usually not a major concern. For example, a person might have:

• CIBIL Score: 765
  
  

• Experian Score: 780
  
  

• Equifax Score: 755

All three are within an acceptable range for loan approvals.

It’s also important to note that financial institutions may have internal scoring systems. These systems combine credit bureau data with in-house metrics, making the approval process even more nuanced.

Conclusion

While all credit scores aim to reflect your financial discipline, they are not identical. Each bureau’s scoring model, data source, and timing affect your score differently. Understanding this can help you approach credit more strategically.

Rather than worrying about which score is ‘correct’, focus on maintaining healthy credit habits across the board—pay on time, limit credit utilisation, and check your reports periodically. This approach ensures that all your credit scores, regardless of type, stay in the acceptable range.

Ultimately, knowing the differences between credit scores allows you to make informed financial decisions, improve your credit profile, and access better lending terms in the long run.