Credit scores are an important part of your financial health. Good credit scores has many benefits, including access to loans and credit cards with the most favorable terms. A credit score is a 3-digit number assigned by credit bureaus such as CIBIL, Experian, Equifax or CRIF High Mark. Credit scores can range anywhere between 300-900. The higher the credit score, the more responsible your credit behaviour is considered to be.

All banks and lenders first check your credit score before approving a loan or credit card application. Therefore, a good credit score is important to easily get a loan or credit card approval. There are many other benefits associated with a high credit score:

• Faster Credit Approvals - Applications of borrowers with high credit scores are given preference as it is a reflection of their creditworthiness. Since the credit report takes into account the applicant's repayment track record, it makes it easier and quicker for lenders to process and approve their credit requests.
   
• Lower Interest Rates - Banks and lenders in India have started offering loans as per each applicant’s risk profile. This move has ensured that applicants who have a good credit score can avail of lower interest rates which leads to lower cost of loans. This is very important as even half a percentage of increase reduction can significantly impact loan EMIs and subsequently lead to financial savings.
   
• Longer Tenures - Another benefit that individuals or borrowers with a good credit profile can try to negotiate better tenures interest rates, fee and loan amounts which can significantly lower the monthly EMIs
   
• Lower Processing Charges - Especially in the case of loans, there are several fees involved which are known as the loan or application processing charges. Apart from getting better interest rates, you can also add to your savings due to reduced processing charges offered to people who maintain an above average credit score.
   
• Pre Approved Credit - Based on your credit score, several financial institutions offer pre approved loans and cards with attractive benefits requiring minimal paperwork and other formalities.
   
• Attractive Card Benefits - Higher limits on your credit card are generally decided based on your credit score and your income. With a high credit score, it is easier for your card issuer to increase your credit limit. This is because a high credit score indicates responsible credit behavior and therefore, decreases the risk factor for lenders

You can build and maintain a high credit score over a period of time. All you need to do is stay focused on maintaining good credit behavior to be eligible for credit as it will not just help you avail credit, but will also help you get rewarded for your credit-conscious behavior in the form of the above mentioned benefits.

If you need funding, you can explore a wide range of loan products that HDB Financial Services With HDB’s easy eligibility criteria, fast processing applications and affordable loan interest rates, you can always have funds ready for all your requirements So, connect today!