World over, there are millions of credit card holders. There is an agency to monitor our credit score. We call it the CIBIL Score. Many a time, there are issues caused due to lack of updation of the CIBIL score. This was brought up by Congress MP Karti Chidambaram in Parliament.
This comes in the context of opposition members in the Lok Sabha strongly opposed to a banking reforms bill brought by the BJP on 3 December 2024. The opposition described the bill as a “donkey passage” aimed at privatizing India’s banking sector, while the bill purports to improve bank guarantees and investor protection.
Sivaganga Congress MP Karti Chidambaram, speaking in Parliament, stated, “Like Chitra Gupta makes accounts of all our activities in this world to Yamadharma, there is this agency called ‘CIBIL’ which is keeping a record of all our transactions. If you want to take a car loan, or if the finance minister of the country wants to take a house loan, everything depends on the CIBIL score. But nobody knows how this CIBIL organization works; it is actually a private company called ‘TransUnion.’ This is the company that is rating every one of us based on our credit history, but we do not know whether they are updating our credit history properly. There is no transparency, and there is no way for us to appeal. There is complete asymmetry between the company that is rating us and us. There is no redressal at all, sir.”
He further said, “Every time we go tell a bank, I have paid my loan on time, but they will say no your CIBIL score is bad. We do not know how to approach CIBIL. For farmers, when they get a subsidy from the government, when they use the subsidy to repay the loan, CIBIL does not update it. If you go for a settlement with the ARC, CIBIL does not update it. There must be greater transparency. The government has missed out an opportunity to make life easier by reforming these things instead of just tinkering in the margins.”
CIBIL Score – set on fire @KartiPC 🔥🔥 pic.twitter.com/RuEBEsvmDj
— With P.Chidambaram – Fan of P.Chidambaram (@wthPChidambaram) December 3, 2024
It is important to note that CIBIL has an entire section dedicated to dispute resolution, available for both customers and businesses. The dispute resolution process is offered free of charge, with a detailed step-by-step guide provided, including the names and contact information of nodal officers. This information is readily available on the CIBIL website.
The MP also said that he wasn’t sure whether CIBIL was updating its records, but it’s important to highlight a key point: under the Credit Information Companies (Regulation) Act of 2005, CIBIL cannot modify any information in its database without confirmation from the relevant Credit Institution. These institutions submit data to CIBIL every 30 to 45 days. Therefore, if you check your CIBIL Score and Report within 45 days of paying off or closing an account, the updated information might not yet appear in CIBIL’s records. As of now, it is the responsibility of the customer to verify with their bank whether the relevant details, such as loan repayments, have been properly uploaded to CIBIL, as CIBIL cannot make these updates on its own. However, many customers remain unaware and have called for a transparency in the dispute resolution process in CIBIL.
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