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Last updated: 27 Sep, 2014  

Credit.Rating.9.Thmb.jpg The significance and role of Company Credit Report (CCR)

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CIBIL Consumer Relations | 16 Jul, 2013

A good credit history plays a crucial role in determining the ability of a business to borrow money. Lenders today check the Company Credit Report (CCR) while determining the credit worthiness of companies. Companies include not only Private & Public limited firms but also Partnerships, Trusts, HUF and Self Help Groups etc. CIBIL maintains the credit information of these various entities submitted to it by its members (Banks and financial institutions) across credit products. The credit products included are Cash Credit, Overdraft, Export bills purchased/discounted/advanced against, Derivatives, Business loan etc. Basis this credit information a Company Credit Report (CCR) is generated

Uses of a CCR:

The advantages of accessing your Company's Credit Report are many fold:

  1. While applying for a loan- If you have a business enterprise of your own and are looking to expand further the scale of operations, then this may require additional financing. This is when the importance of the CCR is significant. As a record of your company's credit history, this report is used by Credit Institutions to make informed lending decisions-quickly and objectively. Therefore, a CCR plays a crucial role in the loan approval process. By accessing your CCR you can better understand your financial standing.

  1. Builds reputational collateral with business partners- Your Company's Credit Report acts as an indicator of your company's financial strength. It can help you negotiate better credit terms while doing business.

  1. Re-evaluate the existing trade credit practice- Ask your business partners to build reputational collateral with you and share their Company Credit Report with you. This would give you an understanding of your potential business partner's creditworthiness. Allowing you to periodically re-evaluate the trade credit you provide.

Understanding CCR:

You can check your company's credit health by accessing the CCR for Rs 2560/- by simply logging on to www.cibil.com , completing the online request form and uploading your company's KYC details. Important sections in your CCR:

  • Credit Facility details: In this section you can locate the details of the credit facilities availed by your company and the repayment pattern.

  • Guarantor details: This section provides details of the business entity/individual that has - guaranteed the particular credit facility (if any) availed by your company.

  • Credit facilities guaranteed: This section details out the credit facilities that have been guaranteed by your company. Since your company is the guarantor, it is also your responsibility that the concerned business entity honors their credit obligation, else your company will be liable to pay.

  • Enquiry details: This section contains the details of all the enquiries, i.e., the number of times your company's credit information has been requested by the member (Banks and Financial Institutions) from CIBIL over a period of last 2 years.

  • Suit Filed Account(s) of the Borrower - Details of any suit filed against your company are captured here.

 
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