Your CIBIL Score Controls Your Life, But Who Controls CIBIL?

Every time you apply for a loan, credit card, or even try to buy a phone on EMI, there's one thing that decides your fate; your CIBIL score. But do you know who really controls this powerful system that can make or break your financial dreams?

The 3-Digit Number That Rules Indians In today's India, a simple 3-digit number between 300 and 900 decides whether you can buy a house, start a business, or get a credit card. This number is your CIBIL score. Whether you're a farmer needing a crop loan or a software engineer wanting a car loan, everything depends on this score.

But here's what most Indians don't know; the company that controls this score isn't even Indian anymore. Who owns CIBIL The Credit Information Bureau (India) Limited, now known as TransUnion CIBIL Limited, was established in August 2000 following recommendations by the RBI's Siddiqui Committee. What began as a joint venture between Indian banks and the American multinational TransUnion has evolved into a financial powerhouse that maintains credit records for over 600 million individuals and 32 million businesses across India

But over the years, something changed. Indian banks started selling their shares in CIBIL to an American company called TransUnion. Today, TransUnion owns 77% of CIBIL.

Why did this happen? When Indian banks faced huge losses from bad loans around 2016, they needed money quickly. So they sold their CIBIL shares to TransUnion. Banks like ICICI and Bank of Baroda sold their stakes, giving more control to the American company How CIBIL Really Works The fundamental issue with CIBIL's operations lies not just in its foreign ownership, but in its complete lack of transparency. Despite handling sensitive financial information of hundreds of millions of Indians, the organization operates with minimal oversight or accountability mechanisms that citizens can understand or access. When borrowers approach banks claiming they have paid their loans on time, they are often told their CIBIL score is poor. However, there exists no clear mechanism for individuals to understand how their scores are calculated, why specific information is reflected, or how to correct obvious errors. This creates a complete information asymmetry between the rating company and the millions of Indians whose financial lives it controls The calculation methodology, while broadly outlined as considering payment history (35%), credit utilization (30%), length of credit history (15%), new credit inquiries (10%), and credit mix (10%), remains a black box. The specific algorithms, the weightage given to different types of defaults, the timeline for updating positive changes, and the criteria for removing negative marks are all proprietary information that CIBIL guards closely.

Systemic Issues: When Good Faith Meets Bad Records The opacity becomes particularly problematic in scenarios involving farmers and genuine financial difficulties. When farmers receive government subsidies and use them to repay loans, CIBIL often fails to update these positive developments in their credit reports. Similarly, when borrowers reach settlements with Asset Reconstruction Companies (ARCs) – legally recognized resolution mechanisms; CIBIL does not necessarily reflect these settlements as positive developments.

This creates a vicious cycle where borrowers who have acted in good faith find themselves trapped with poor credit scores despite fulfilling their obligations through legitimate channels. The lack of real-time updates means that positive financial behavior may not be reflected for months, while negative information appears almost immediately.

The organization received over 22.9 lakh complaints in the financial year 2024-25, with approximately 5.8 lakh complaints stemming from issues at CIBIL's own end. These staggering numbers reflect the scale of problems faced by ordinary Indians trying to navigate this opaque system.

When the System Fails the Common Man Recent problems in Tamil Nadu show how this American system is being forced on Indian farmers. When farmers protested against CIBIL requirements for crop loans, it became clear that this foreign-controlled system doesn't understand Indian realities.

A farmer who has been growing crops for decades suddenly needs a "credit score" from an American company to get a loan from his local cooperative society. This is not just unfair, it's absurd.

The Real Cost of This Broken System When CIBIL wrongly gives low scores to good borrowers, it hurts the entire Indian economy. People who should get loans don't get them. Small businesses can't grow. Young people can't buy homes. The whole economy slows down because of a broken system.

Even worse, all the financial data of Indians - who borrows what, who pays on time, who faces problems, is sitting with an American company. This information could be very valuable for understanding India's economy, but it's controlled by foreigners.

What Can Be Done? The solution isn't to destroy the credit scoring system. India needs a way to track who pays loans and who doesn't. But the system must be fair, transparent, and serve Indians first. Here's what needs to change:

• Make It Transparent: CIBIL should explain exactly how they calculate scores. No more secret formulas.
• Fix Updates Quickly: When someone pays a loan or settles dues legally, it should show up in their score immediately.
• Independent Complaints System: There should be a separate authority to handle CIBIL complaints, not just asking banks to verify their own data.
• Bring Control Back to India: The government should consider whether such important financial data should be controlled by a foreign company.

Educate People: Every Indian should know how to check their CIBIL score for free and how to fix errors. Why This Matters to Every Indians

Your CIBIL score affects major life decisions - buying a home, starting a business, your child's education loan. It's not right that such an important system works like a black box controlled by a foreign company.

In a democratic country like India, people have the right to know how their financial fate is decided. They have the right to get errors fixed quickly. They have the right to fair treatment from companies that have so much power over their lives.

Conclusion The CIBIL system, while serving the legitimate purpose of enabling risk assessment in lending, has evolved into an unaccountable behemoth that exercises excessive control over Indian citizens' financial lives. The combination of foreign ownership, algorithmic opacity, and weak redressal mechanisms has created a system that serves banks and credit companies more than it serves ordinary Indians.

As India moves toward becoming a developed economy, ensuring that financial systems are transparent, accountable, and serve the interests of Indian citizens must be a priority. The current CIBIL system, dominated by American corporate interests and operated without adequate transparency, represents a form of financial colonialism that democratic India should not tolerate.

The time has come for comprehensive reform of the credit information ecosystem, not to destroy it, but to make it truly serve the Indian people. Every citizen has the right to understand how their financial fate is determined, to have errors corrected promptly, and to be treated fairly by institutions that wield such enormous power over their lives.

Only through such reforms can India build a credit system that enables financial inclusion rather than exclusion, that serves economic development rather than corporate profits, and that respects the dignity and rights of every citizen whose financial life it touches. The question is not whether such reforms are necessary, but whether India has the political will to implement them in the face of powerful vested interests that profit from the current opacity.

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