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Credit awareness in India has a long way to go, with more than 85% respondents being unaware of what credit bureaus are. Delhi and Pune led with one out of four respondent aware about credit bureaus. In fact, a whopping 92% are unaware of their credit scores. Delhi, Bangalore and Pune had more than 10% respondents knowing their score.
The survey,Credit Health in India, was conducted by Credit Sudhaar, a credit improvement company, across 8 cities in India and sampled over 300 respondents.
"We wanted to understand the reasons for the unavailability of credit to clients due to negative credit history and a low credit score. The survey revealed that 91% customers were unaware of the impact of non-payment of dues. We feel that a lot of this could have been avoided if they would have been aware of their credit health and the impact of non-payment of credit dues. We also realised during the survey that penetration of professional credit counselling is almost non-existent in India, which leaves space for presence of credit advisory services," said Arun Ramamurthy and Gaurav Wadhwani, co-founders of Credit Sudhaar.
While a mere four% had reviewed their credit score in last one year, 98% who took the survey were unable to comprehend the report that was shared with them. The survey revealed protection of credit as a major concern as none of the respondent had taken any steps to protect their identity from theft.
Even as a 'will' is an important tool when it comes to securing inheritance and ensuring a dispute free transfer of assets. Only one% respondents have made a will and others had no idea or inclination to make or understanding one. On tax optimisation front, only 17% have taken help from an expert.
As a part of the survey, Credit Sudhaar analysed 2,116 credit bureau reports and accordingly analysed the details reported in the bureau reports with the individuals. Based on the analysis errors were identified in 557 reports of unique individuals.
Another part of the survey was aimed to understand the penetration of major credit bureaus in the Indian market, specifically with major financial institutions. It was evident that Cibil is the bureau most of the institutions upload their data to whereas Equifax is a close second. In terms of Microfinance lending, the market is dominated by Highmark and Equifax.
