You may want to focus on boosting your credit now that you know more about the advantages of having good credit. These seven credit-building steps can be useful:

• Keep track of your credit ratings on a regular basis.
• Understand the components of a standard credit score.
• Keep an eye out for any inaccuracies on your credit reports.
• Find out how frequently you should check your credit reports.
• Learn how to prevent the most common credit card blunders.
• Pay your bills on time and keep your credit card balances low.
• Quick credit score repairs should be avoided.

What formula is generally used to calculate a credit score?

While each credit bureau has its unique model for determining credit scores, there are a few unchanging characteristics that all credit bureaus take into account. The following factors are taken into account:

• 35 percent payment history
• 30 percent credit utilisation
• 15 percent of people have a credit history
• 10 percent new credit
• 10 percent credit mix (credit accounts of different types that make up a consumer’s overall credit report)

Requesting a Free Credit Report

Since 2017, the Reserve Bank of India (RBI) has required all credit bureaus in the country to provide consumers with one free credit report every calendar year.

Below are the four credit bureaus currently operating in the country:

• TransUnion CIBIL
• Equifax
• Experian Credit Information Company
• High Mark Credit Information Service

This means you can acquire four credit reports per year. You can also sign up for any of these bureaus to receive your credit reports, which include your credit score.