Your CIBIL score (or credit score from Experian, Equifax, CRIF) is a three-digit number that determines whether you get a loan, at what interest rate, and with what credit limit. Yet most Indians operate on myths that actively hurt their score.
Myth 1: Checking your own score lowers it
False. When you check your own score (a "soft inquiry"), it has zero impact. Only "hard inquiries" — when a lender pulls your report during a loan or credit card application — can temporarily reduce your score by 5–10 points. Check your score monthly; it is free on CIBIL, Paytm, and several banking apps.
Myth 2: Closing old credit cards improves your score
Usually false. Closing a card reduces your total available credit, which increases your credit utilization ratio — one of the biggest scoring factors. If you have 3 lakh total credit and use 60,000, your utilization is 20% (good). Close a card worth 1 lakh, and your utilization jumps to 30% (borderline). Keep old cards open even if unused, unless they carry annual fees you cannot justify.
Myth 3: Paying the minimum due is enough
Paying minimum due avoids late fees but not interest. Revolving credit card debt carries 30%–42% annual interest — the most expensive debt available. It also signals risk to credit bureaus over time. Always pay the full statement balance before the due date.
Myth 4: No credit history equals a good score
No history means no score. Lenders see you as an unknown risk. If you have never had a credit card or loan, your score is either absent or very low. The fix: get a basic credit card, use it for small purchases, and pay it off in full every month. Within 6–12 months, you will have a trackable score.
Myth 5: Income affects your credit score
Your income does not appear in your credit report. The score is based entirely on credit behavior: payment history, utilization, account age, credit mix, and hard inquiries. A person earning 30,000 per month with perfect payment history can have a higher score than someone earning 3 lakh with missed EMIs.
What actually matters
Payment history (35%), credit utilization (30%), credit age (15%), credit mix (10%), and recent inquiries (10%). Focus on paying on time and keeping utilization below 30%. Everything else follows. Compare cards with low fees and good rewards on our cards page.