Credit Score Improvement
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Credit Health Survey


The Credit Health Survey is an attempt to
understand retail consumer credit health trends
in India. This survey is conducted by Credit
Sudhaar Services Pvt. Limited which is India’s
premier Credit Health Management Company.

Credit Sudhaar

Credit Sudhaar Services Survey Authored by Swarup Deb Sandhya Dixit 9/3/2013

1. Introduction

1 Company Introduction
2 Methodology
3 Consumer Credit Survey
4 Consumer survey for credit Impaired customers
5 Major and Minor errors on the Report
6 Credit Bureaus and their penetration in Financial Institutions in India
7 Disclosures

1. Introduction

Credit Sudhaar was founded in 2010 with a vision to Restore, Enhance and protect a person's credit through various stages of the credit life cycle. Our research suggests a wide gap between where clients need to be and where they are in terms of their awareness and overall understanding of Credit. We provide credit counseling and aid customers to Restore, Enhance and protect their credit profile. Our scope of services includes but is not limited to:

1. Providing credit counseling services.

2. Educating people on responsible borrowing , proactive and early savings, and offering debt counseling to individuals who are indebted to formal and/or informal financial sectors

3. Expanding horizons on various fronts which promote financial literacy, awareness of the banking services, financial planning and amelioration of debt-related distress of an individual;

We undertook this survey to understand and analyze certain parameters related to overall understanding of credit profile of an individual at a retail level and its inroads in Indian Market and context. There are four major aspects in which we have studied this survey.

1. Consumer Survey on Patterns and behavior of individual credit profiling in India - We worked on parameters like awareness of credit score, reports and Bureaus. We also tried to understand how aware and proactive clients are to deal with new age crimes like Identity theft, will and tax optimization & neo concepts of financial literacy.

2. Clients who have been in credit impairment – A comprehensive analysis to understand why do customers delay their payments and why do they pay eventually?

3. Impact of Errors in Credit Bureau reports – we did an extensive study of more than 2000 data points to understand accuracy and the impacts these errors can have on your credit report.

4. Credit Bureaus and their penetration in Financial Institutions in India – This survey was undertaken to understand the usage that bureaus have been able to penetrate in leading Financial institutions in India.


The survey in all is a compilation of four sets of questionnaires to understand and judge the understanding, impact and penetration of credit in Indian market. The approach to get the sample has been universal and we have tried to have the data distributed across 8 major cities of India. A robust and homogeneous methodology was used across cities including over 300 interviews in the 8 major cities. There were on average 40 interviews per questionnaire per city. The interviews were a mix of in-person and telephonic interactions.

3. Survey on Client Awareness

3.1 Objective:

To understand the client’s behavior, information and patterns in credit market.

3.2 Methodology:

Survey is administered on a heterogeneous data from 8 prominent cities of India – Delhi, Calcutta, Mumbai, Pune, Chennai, Bangalore, Hyderabad and Ahmedabad. We interviewed more than respondents from these cities face to face and telephonically depending on the ease of the respondent. The data administered was made a have a mix of genders and income groups. It was interesting to see that the reasons of credit impairment and subsequent restoration remained more or less uniform throughout the base.

3.3 Awareness of Bureau:

A credit bureau is defined as a repository of data relating to credit history of an individual. The approach for consolidating such data is to see a pattern in consumer’s credit behavior and an insight to his financial behavior. One of the most important C’s of credit. The other two being Collateral and capacity.

According to the survey findings Credit awareness in India has a long way to go, with more than 85% of the respondents not being aware of credit Bureau. Delhi and Pune still led the country with 4 out of 1 respondent being aware of credit bureaus.

3.4 Awareness on Credit Report and Score:

The financial statements kept and published in a consolidated form is called credit report. Bureaus arrive at a 3 digit score using an established formula, this 3 digit score is known as Credit Score and is used as a reference point to understand consumer’s tendency and credit behavior. An overwhelming 92% was not aware of this parameter. Delhi, Bangalore and Pune had more than 10% respondents knowing their score.

3.5 Reviewed Credit Score in last 1 year:

A mere 4% had reviewed their Credit score in last 1 year.

3.6 Understanding Credit Report:

Understanding and analyzing Bureau report could be a task difficult to comprehend. 98% of the respondents who took the survey were unable to comprehend the report that was shared with them.

3.7 Credit Protection:

Protection of credit appears to remain a major concern. As a nation with an increasing appetite for consumerism, credit usage and internet proliferation, none of the people had taken any steps to protect their identity from theft.

None of the respondents had protection against ATM assault, theft and on lost wallet. Only 5% of the respondents who took this survey had protection against fraudulent usage on their credit card.

3.8 WILL and Tax Optimization:

WILL is an important tool when it comes to securing inheritance and ensuring a dispute free transfer of assets. Only 1% of the respondents have made a will and further more had no idea or will to make or understanding of a WILL.

We also attempted to understand how people deal with their issues on taxation. 17% of the customers have taken help for tax optimization.

4. Survey for Clients on Credit Impairment

4.1 Objective:

To Understand and analyze the cause and effect analysis of clients who have been through credit impairments.

4.2 Methodology:

In order to understand the Cause and analysis of customers who have delayed their payments beyond permissible time limits and have moved into collections bucket, we administered a survey on 200+ customers.

4.3 Awareness:

Credit Impairment can be defined as unavailability of credit when required at desired rates for presence of negative credit history and a low credit score. When we did a survey on the respondents, we realized that a lot of this could have been avoided if they would have been aware of the impact of non-payment of credit dues. 91%of the customers were not aware of the impact of non-payment of credit dues. Customers who said they were aware did not quiet understood the kind of grave impact that it would have on their credit history and financial standing.M

4.4 Reasons for Credit Impairments:

Prominent reasons for credit impairment were financial constraints which contributed for more than 50% of customers not being able to pay in time. A good 44% contribution came from service issues like statements not delivered in time, charges levied without intimating customers, delayed response on customer’s queries and charges levied from banks, Insurance sign-up’s without customers awareness, address change not updated and hence delay in bill and dispute over charges. Most of these issues were aggravated because of ignorance of customers and an institutional failure to own up these customers.

4.5 Reasons for Repayments:

We also tried to know the reasons why such customer’s pay: as expected most of them pay (around 59%) due to pressure from collection agencies. Inability to get the loan is another prominent reason why customers choose to pay their long pending issues.

We also realized during the survey that penetration of professional credit counseling is almost nonexistent in India, Which leaves space for presence of credit advisory services.

5. Survey on Errors in Bureau Reports

As a part of the survey we have analyzed 2116 Credit Bureau Reports and accordingly analyzed the details reported in the Bureau reports with the individuals. Based on the analysis we identified errors in 557 reports of unique individuals. Below mentioned are the details of the reports analyzed:

We further did a deep dive to understand the exact types of errors in the Bureau reports and below mentioned facts were identified:

Understanding the types of errors it was of utmost importance to know the reasons or facts behind the errors and thus segregated types of errors in categories which will give a broader perspective:

Account Status - are errors where account status is not appropriately reported, for e.g. an account which is closed by the client and is still showing settled or outstanding. 91% of the major errors in a bureau report were constituted of this parameter.

Account not reported – These errors refer to the accounts which are not reported to these bureaus.

Ownership Issues – Another important concern the mismatch in details, which could be a faulty pan card number or identity theft as well. Conclusively, 1 out of 4 reports had some error and hence it is required that reports are viewed in entirety and atleast once in 6 months to ensure any impending damages to the financial character of the individual can be avoided.

6. Survey on Bureau Uploads and Usage

5.1 Credit Bureaus and their penetration in Financial Institutions in India:

5.1 Credit Bureaus and their penetration in Financial Institutions in India: This part of the survey was aimed to understand the penetration of major credit bureaus in Indian market, specifically with major financial institutions. We have done a sample of 100 financial institutions to arrive at the data; As far as Non Banking Financial Companies, Private and Public Banks are concerned we basically looked from the perspective of data upload and usage in credit bureaus.

Brief overview of Credit Bureau: CIBIL

The Credit Information Companies (Regulation) Act, 2005, and various Rules and Regulations issued by Reserve Bank of India has empowered CIBIL or (Credit Information Bureau (India) Ltd to collect the data from various types of credit grantors (i.e. lenders). and then share the same within the group. The legislation has enabled banks to submit data to CIBIL without obtaining borrower consent this has enabled CIBIL to track repayment history of bank customer’s loans, credit cards and further banking finances.

CIBIL’s aim is to fulfil the need of credit granting institutions for comprehensive credit information by collecting, collating and disseminating credit information pertaining to both commercial and consumer borrowers, to a closed user group of Members. Banks, Financial Institutions, Non Banking Financial Companies, Housing Finance Companies and Credit Card Companies who use CIBIL’s services. Data sharing is based on the Principle of Reciprocity, which means that only Members who have submitted all their credit data, may access Credit Information Reports from CIBIL. The relationship between CIBIL and its Members is that of close interdependence.At present, over 500 credit grantors across India are members of CIBIL. These include over 300 banks, 27 Housing Finance Companies, 10 Financial Institutions, 2 Credit Card Companies, 8 State Financial Corporations and 170 Non Banking Financial Companies (NBFCs).


Equifax India is registered as Equifax Credit Information Services Private Limited (ECIS). It is a joint venture between Equifax Inc., USA and six leading Indian financial institutions - Bank of Baroda, Bank of India, Kotak Mahindra Prime Limited, Religare Finvest Limited, Sundaram Finance Limited and Union Bank of India.Equifax India was granted its 'Certificate of Registration' on 26th March, 2010 by the Reserve Bank of India (RBI) to establish a credit information company under ‘The Credit Information Companies (Regulation) Act' 2005 (CIC Act). They launched consumer credit bureau in September 2010 and also launched a separate dedicated bureau to address the growing lending and regulatory needs of the Microfinance Institutions in May 2011. They currently have 200 registered members and are regularly adding new members and data into the bureau.

Experian and High Mark are other two bureaus attempting to make inroads into the Indian markets. In the survey conducted with various segments of financial institutions, it was evidently 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.

As far as data usage is concerned, CIBIL being the oldest player in the market dominates all segments other than Micro finance institutions which are prominently referring to Equifax and Experian.


This survey was by conducted by Credit Sudhaar with the objective of understanding the credit understanding and behaviour towards various aspects of credit, credit bureaus and other aspects related to it. Survey 1 - Consumer credit awareness Respondents – 307 Cities covered - Ahmedabad, Bangalore, Calcutta, Chennai, Delhi, Mumbai, Hyderabad and Pune. Age group – 25-40 years Mode of the survey – Primary, physical survey through forms administered in public places like malls, petrol pumps. Tele – confirmation used for Chennai. Nature of questionnaire administered – direct questions confirming credit knowledge, understanding and its importance and to know the extent and perceived need of credit protection in India. Survey 2 – Credit impairment Respondents – 200 Area covered – Delinquent customers pan India; city wise demarcation has not been an influencing factor in analysing the data results. Mode of the survey – Primary survey done through telephonic interviews. Nature of the questionnaire administered – questions to know about whether respondents were aware of impact of non payment of credit dues, Reasons for payments of the dues etc. Survey 3 – Errors in credit reports Data analysed – more than 2000+ credit bureau reports surveyed with client consent Mode of the survey – primary analysis of the reports of bureaus Nature of the questionnaire administered - Analysis of bureau reports to understand major and minor errors in the report and their impact on the credit score Survey 4 – penetration of credit bureaus in financial institutions in Indian market Data analysed – more than 100 financial institutions segmented into broad catagories of private banks, Public banks, Foreign Banks, NBFC and MFIs. we have taken top 15-20 institutions in each category which contribute to more than 75% lending in each specific segment. Mode of the survey – A mix of primary and secondary survey modes were used Nature of the survey administered - Analysis of upload and usage of each bureau corresponding to specific financial segments. The sample survey covered homogenous distribution of respondents in age group of 25-40 and an income group of 2 lacs to 10lacs across major metros in country. A total of 307 respondents took the survey

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