If you thought your credit history and repayment capacity are assessed only when you go out to buy a house or a car, think again.
Several telecom service providers have decided to track the creditworthiness of their customers — so that they can fix the threshold limits for their bills.
Credit Information Bureau (India) Limited (CIBIL) — the agency that tracks credit history of borrowers and assesses their credit worthiness — is all set to start providing data to telecom service providers as well.
"When a consumer applies for a post-paid telephone facility, the service provider would use the credit score of the applicant to decide on her limit, especially useful when on roaming whether within the country or outside," said Arun Thukral, managing director, CIBIL.
Thukral said CIBIL was in talks with a leading telecom service providers to offer them credit information about their customers.
A credit score, which is a three-digit number ranging between 300 and 900, helps in estimating the creditworthiness and repayment capacity of a loanee, based on the individual's past pattern of credit usage and loan repayment behaviour.
The higher the score, the stronger is the credit history and worthiness of the individual.
The score is given based on income of an individual, her credit pattern and financial behaviour over the previous 36 months.
The move is expected to help telecom providers avoid defaults. It would also facilitate telecom service providers to convert consumers who use pre-paid connections into the post-paid mode, depending on their credit profile.
Thukral said even as a domestic economic slowdown has hit home, more than 70% of the individuals assessed by Cibil still have high scores, indicating they have strong repayment capacity.
With the level of awareness going up, there has also been a sharp increase in individuals approaching credit rating agencies on their own to get their credit history prepared and credit worthiness analysed.
So, do ensure that you pay all your bills on time to maintain a good score.