Credit Rating Agencies

Credit Rating Agencies in India

For firms:
Couple of agencies like CRISIL and Dun & Bradstreet do the credit appraisal of business entities in India..

These rating agencies do rate the business entities based upon some specified criteria like:

  1. Basic Constitution
  2. Industry i.e., Software, Cement, Steel, Food Processing etc.,
  3. Profitability
  4. Dividend Distribution
  5. Repayment of Term Loan
  6. Specific Statutory Registrations etc.,

The above are only few criteria, like this every industry will have certain success key criteria.

 For Individuals:

Nowadays, for individuals having bank accounts  also credit rating is started silently based on bank transactions. Agencies like Crisil is doing the same.  RBI has supported this move ub the interest of banks. The final rating will be the guiding line for banks to lend to those individuals. The various aspects that are being taken into account are :

  1. Transactions nature.
  2. Deposit and loans ratio
  3. Timely repayment of loans
  4. Credit card payments
  5. Dishonour of cheques.
  6. Frequency of transactions.
  7. Safe deposit lockers.
  8. Various types of accounts  in the bank including current accounts for business.

So individuals should be careful now to see that their bank operations are going smooth as banks have allowed credit agencies to rate their customers and it will be kept in a central domain so that any bank can use this data.  Persons defaulted in payments will be questioned lot before giving away any loans.

C.R. Venkata Ramani



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