Credit Score Loan Application: The Reserve Bank of India has given a clear message to all banks and lending companies that they cannot turn down a loan request just because the person has no past credit record. This order applies to public banks, private banks, housing finance firms and other financial bodies. The rule was written in the RBI’s Master Directions on January 6, 2025, and the Finance Ministry also repeated this in Parliament on August 18, 2025 during Question Hour, reported Business Standard.
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The RBI explained that lenders must look at the application fairly, even if it is from a first-time borrower. The central bank also said that there is no fixed credit score needed for getting a loan. Lenders do have to check the report and score, but the final choice depends on the bank’s own rules and judgement. The RBI stressed that not having a credit record should not be the only reason for rejecting a request. Many new borrowers never took a loan or a card before, so they should not face unfair rejection.
New plans for fair lending
Many people have complained that banks keep refusing those without a CIBIL score or history. To answer this, financial expert Ashwani Rana, who started Voice of Banking, said that banks should check other things like income tax returns and bank statements for such first-time people.
He also explained that the government is now working on something called a unified lending interface. This will act as another option to old credit systems like CIBIL. The plan is to make lending more open so that even those outside the system today can get access.
The government earlier announced in the 2023–24 Budget that a National Financial Information Registry will be made. This NFIR will keep all financial and credit data together in one place. Once it starts, banks can take better decisions because they will see a full profile of a borrower. This NFIR will be built under the guidance of RBI. But the government also said that CIBIL will not be removed, it will still run as India’s main credit bureau.
Credit reports
In India, RBI has given four companies the right to run as credit data providers. These are TransUnion CIBIL, Equifax, Experian, and CRIF High Mark. They can take up to ₹100 if someone asks for a credit score. But since September 2016, RBI made it a rule that each person must get one free report every year from these agencies. This free report will also show the score.
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The RBI asked banks to stay transparent. So whenever someone’s report is checked, the customer must get an SMS or email alert. If a loan EMI is late or missed, then the person should get quick alerts too.
