Myths about the credit bureau itself, such as a “CIBIL defaulter list” or CIBIL rejecting loans, are covered in our companion guide, CIBIL score myths: 10 things CIBIL doesn’t do. This page tackles the other kind: 15 myths about your own money habits, the ones that decide what your report says each month. For how scores are built, see what creates a good CIBIL score.
The 15 myths at a glance
| # | Myth | Reality |
|---|---|---|
| 1 | Paying the minimum due keeps my score safe | Avoids a late mark, but keeps utilisation high |
| 2 | Using the full limit is fine if I pay in full | The balance on the statement date is what is reported |
| 3 | Closing an old card boosts my score | Often lowers it |
| 4 | A few days late, or a ₹500 overdue, doesn’t count | It can be reported |
| 5 | BNPL and small app loans aren’t reported | Most are |
| 6 | Prepaying a loan hurts my score | It doesn’t |
| 7 | Debit card and UPI spending build my score | They aren’t reported |
| 8 | Paying rent and bills on time builds my score | Usually not reported |
| 9 | Comparing loan offers always lowers my score | Only formal applications count |
| 10 | Many small loans build a score fast | Usually backfires |
| 11 | A closed loan disappears from my report | It stays, as history |
| 12 | My spouse’s bad score lowers mine | Only joint accounts are shared |
| 13 | A new job or lower salary drops my score | Income isn’t part of the score |
| 14 | I have one credit score | You have one at each of four bureaus |
| 15 | An agent can delete bad entries for a fee | Only errors can be corrected, free |
Myths about credit cards
Myth 1: Paying the minimum due keeps my score safe
Paying the minimum stops the account being reported as late, which matters. But the unpaid balance carries heavy interest and stays on your statement, so your utilisation remains high month after month. High utilisation is one of the most common reasons a score with no late payments still stalls. Pay the full statement amount when you can; read the perils of maxing out your card.
Myth 2: Using the full limit is fine if I pay in full
Card issuers usually report the balance on your statement date, not the amount you pay later. If you spend ₹95,000 on a ₹1 lakh card and pay it all on the due date, the bureau may still see 95% utilisation.
Same spending, different reported utilisation
Illustrative. Issuers’ reporting dates vary; check your card’s statement date. The 30% figure is a widely used guide, not a hard rule.
Myth 3: Closing an old card will boost my score
Closing a card removes its limit from your total, so the same spending now shows as higher utilisation. If it is your oldest card, you may also shorten your visible credit history. Keep a no-fee old card open and use it lightly. For more on juggling several cards, see do several credit cards or inactivity affect your score.
Myths about payments and small dues
Myth 4: A few days late, or a ₹500 overdue, doesn’t count
Lenders report days past due each month, and the amount does not need to be large. A forgotten ₹500 card balance or a bounced ₹900 phone EMI can show as overdue. A payment 30 or more days late does clear damage. Set auto-pay for at least the minimum on every card, and check that every EMI mandate is debiting the right account.
Myth 5: BNPL and small app loans aren’t reported
Buy-now-pay-later lines and loans from RBI-regulated lenders are generally reported to bureaus, including the small ones. Missing a ₹2,000 BNPL payment counts. Check any app you use against the RBI directory of digital lending apps.
Myth 6: Prepaying a loan hurts my score
Closing a loan early is reported as closed, which is a positive outcome. Your score may shift slightly because an active, well-paid account is gone, but there is no penalty for being responsible. Check your loan agreement for any prepayment charge before you do it.
Myths about building a score
Myth 7: Debit card and UPI spending build my score
Debit cards and UPI spend your own money. Nothing is borrowed, so nothing is reported to credit bureaus. They are good for budgeting but do nothing for your score.
Myth 8: Paying rent and bills on time builds my score
Rent and most utility and phone bills are not reported to credit bureaus in India, so paying them on time, while important, usually does not raise your score. What does is a credit product repaid on time, such as a credit card or a small loan.
Myth 9: Comparing loan offers always lowers my score
Checking your own score, or viewing pre-approved offers, is a soft enquiry and has no effect. A formal application, where a lender pulls your report to decide, is a hard enquiry. A few of those spread out are normal; many in a short time are a warning sign. Read how loan enquiries affect your score.
Myth 10: Many small loans build a score fast
Each loan adds an enquiry and a new account, and short-term app loans are easy to miss or roll over. One credit card or one small loan, repaid on time for a year, builds more than ten quick loans. If you are already juggling several, SmartSwitch can replace them with one EMI.
Myths about your report and your life
Myth 11: A closed loan disappears from my report
Closed accounts stay on your report as history, which is good news if you paid them well. A closed loan with a clean record keeps helping. A closed loan with past delays still shows those delays.
Myth 12: My spouse’s bad score lowers mine
Scores are individual. Marriage does not merge them. Only accounts you hold jointly, or loans where you are a co-borrower or guarantor, appear on both reports.
Myth 13: A new job or a lower salary drops my score
Income is not part of the score. Lenders look at income separately when they decide on a loan. The real risk with a job change is practical: EMIs bouncing from an old salary account.
Myth 14: I have one credit score
TransUnion CIBIL, Experian, Equifax and CRIF High Mark each calculate their own score from what lenders report to them, all on a 300 to 900 scale. They are often close but rarely identical, and a lender may check any of them. You can get one free full report from each bureau every year.
Myth 15: An agent can delete bad entries for a fee
Accurate information cannot be removed. Errors can be corrected, and you can dispute them yourself for free through the bureau; see CIBIL dispute resolution. Anyone promising to “clean” a correct report is selling something that does not exist.
What actually moves a score
- Every EMI and card payment on time, every month.
- Card balances under about 30% of the limit on the statement date.
- A mix of credit used responsibly over years, with old accounts kept open.
- Few formal applications, spaced out.
- Your reports checked yearly, and errors disputed.
If myths have already cost you points, our Credit Score Booster reviews your report and builds a plan, without promising any particular score. And if your score is 600 or more and your take-home salary is ₹40,000 or more, Omozing, a brand of RBI-registered NBFC Aparampaar Finance, can consider you for a personal loan with a credit officer reading your full report.
Score not where you want it?
See how we assess salaried borrowers from a 600 score, or get help rebuilding first.
Frequently asked questions
Does checking my own credit score lower it?
No. Checking your own score is a soft enquiry and has no effect. Only formal loan or card applications, where a lender pulls your report to decide, are hard enquiries.
Is paying the minimum due on a credit card bad for my score?
It avoids a late-payment mark, but the unpaid balance keeps your utilisation high and attracts heavy interest, which can hold your score down. Pay the full statement amount whenever possible.
Should I close credit cards I don’t use?
Usually not your oldest one. Closing a card reduces your total limit, which can raise utilisation, and can shorten your credit history. Close cards with annual fees you don’t need, but keep a no-fee old card active.
Do UPI payments or rent payments improve my CIBIL score?
No. UPI and debit cards spend your own money, and rent and most bills are not reported to credit bureaus, so they do not build your score. Repaying a credit product on time does.
Does prepaying a personal loan reduce my credit score?
No. The loan is reported as closed, which is positive. Your score might move slightly as an active account closes, but there is no penalty for paying early. Check your loan agreement for any prepayment charge.
Why are my CIBIL and Experian scores different?
Each bureau builds its own score from the data lenders send it, using its own model. The scores are usually close but not identical, and lenders may use any of them.
Can someone remove a correct negative entry from my report?
No. Only errors can be corrected, and you can dispute them yourself for free with the bureau. Be wary of anyone charging to delete accurate entries.
Omozing is the digital lending brand of Aparampaar Finance Private Limited, an RBI-registered non-deposit-taking NBFC. Loans are subject to credit assessment. See our regulatory disclosures and grievance redressal process.