The number of people taking loans from banks and non-banking financial institutions is increasing day by day. Given this, the need for change in the way of measuring credit score is now being felt. In this direction, many initiatives have also been taken on the initiative of the RBI and the Department of Financial Services of the Ministry of Finance.

Recently, the Unified Landing Interface (ULI) platform has been added to the country's digital public infrastructure, like Unified Payment (UPI), with the help of which the credit capacity of a person can be assessed even if he does not have a credit score. The Department of Financial Services has asked all the departments of the Center and the State to connect to ULI so that all the information of any person can be obtained if needed.

What will be the benefit?
With the connection of NABARD to all the co-operative and rural banks of the country with ULI, information about the loan taken by a person in the form of cash will also be available. All information, like the property, farm-barn of the person, will be available through ULI. Farmers who have not taken any loan till now will be able to get the details of their land and crops easily. The ULI framework will also be linked to e-commerce and gig workers platform so that the credit score of all gig workers, along with small buyers and sellers, can be prepared.

Use of 25 a 25-year-old method
RBI believes that 25 the old method is being used to prepare credit scores. Then, Credit Information Bureau India Limited (CIBIL) was established to measure credit scores. After that, three other companies are also working as Credit Information Companies (CIC).

CIBIL score will be updated in real time
RBI believes that currently, a person's credit score, which is also called CIBIL in common parlance, is updated in 15 days. Now it needs to be updated on a time basis. Many times it also happens that due to an error in the availability of data, a wrong credit score is prepared, the brunt of which has to be borne by the customers. Therefore, the RBI is now considering introducing a unique identification number for borrowers. Apart from this, emphasis is being laid on the availability of accurate and real-time data.

Those who do not have a CIBIL score did not get loans.

There are many people in rural areas who do not have a CIBIL score. In such a situation, they face difficulty in getting loans. Given this, in the budget presented last year, it was announced to prepare a framework for rural credit score, on which work is being done under a pilot project. Soon, financial institutions across the country will use the rural credit score to give loans.

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