How to Remove Inquiry from CIBIL™?

Share with

Many believe that an inquiry on your CIBIL™ report will stay there forever. But that's not the fact. With the correct approach, you can remove the unwanted inquiries from hurting your creditworthiness.

What is a CIBIL™ Inquiry?

When you apply for a loan or a credit card, the lender runs a CIBIL™ report check on your profile with the CIBIL™. This is called a credit inquiry. Every time a lender runs this CIBIL™ inquiry check, it is known as a hard inquiry on your credit profile. Avoid having multiple loan inquiries on your CIBIL™ report within a short span of time. This will bring down your credit score.

Why Do Inquiries Appear on Your CIBIL™ Report?

There are several reasons why inquiries can appear on your CIBIL™ report. Inquiries are requests made to credit bureaus to view the credit history and assess the creditworthiness. Two types of credit inquiries appear in your CIBIL™ report. There are hard inquiries and soft inquiries.

A hard inquiry is triggered on your CIBIL™ report when a lender checks your creditworthiness with the credit bureaus. Hard inquiries appear on your CIBIL™ report, indicating that you are actively seeking credit. The impact of hard inquiries on your CIBIL™ report reduces your credit score.

A soft inquiry appears on your CIBIL™ report when you check your own report. When a lender wants to give you a pre-approved loan or credit card, they would like to know your credit standing. Pulling your CIBIL™ report by such lenders will amount to a soft inquiry. Soft inquiries do not create an adverse effect on your CIBIL™ report.

The following are some of the scenarios where a credit inquiry appears on your CIBIL™ report. They are:

• Loan Application: When you apply for a personal loan , home loan, car loan, or education loan, lenders do check your CIBIL™ report to evaluate your eligibility. This results in a hard inquiry.
• Credit Card Applications: Credit Card Lenders will check your CIBIL™ report before they approve your credit card applications. Multiple credit card applications within a short period of time will lead to numerous credit inquiries and thereby reduce your credit score.
• Pre-approved Offers: Credit bureaus have tie-ups with lenders. Bureaus send a list of credit profiles who are eligible for pre-approved offers to lenders. Lenders would like to check your CIBIL™ report for their satisfaction before granting any pre-approved offers.
• Balance Transfer: If you are planning to balance transfer your loan account to a different lender, the lender will check your creditworthiness through your CIBIL™ report.
• Fraudulent Applications: Occasionally, inquiries may appear on your CIBIL™ report due to identity theft. This happens when someone is applying for credit. Monitoring your CIBIL™ report regularly helps you to identify such issues.
• Increasing Your Credit Limit: When you want to increase your limit on your credit card, lenders will check your CIBIL™ report. This will trigger a credit inquiry.
• Being a Co-Applicant for a Loan: If you are a co-applicant for a loan, the lender will check your CIBIL™ report before approving the loan application.

How Do Inquiries Affect Your CIBIL™ Score?

Your CIBIL™ score reflects your creditworthiness. Credit Inquiries form a part of it. A single CIBIL™ inquiry won't affect your credit score. However, multiple credit inquiries within a short span of time can send incorrect signals to lenders.

• Hard Inquiries Lower Your Score: Every time you apply for a loan or credit card, the lender pulls out your CIBIL™ report from the credit bureaus. This is known as a hard inquiry and gets reported in your CIBIL™ report. Having too many hard inquiries within a short span of time displays a credit-hungry behavior.
• Soft Inquiries Do Not Have Any Impact: Checking your own CIBIL™ report or receiving a pre-approved offer from a lender results in soft inquiries, which do not affect your CIBIL™ report.
• Multiple Inquiries Indicate Credit Hunger: Avoid applying for too many loans within a short span of time. This indicates that you have a credit-hungry behavior, which may cause lenders to hesitate before granting your loan.
• Effect on Loan Approvals: Even a slight drop in your credit score can reduce your approval chances due to frequent inquiries. Lenders prefer borrowers with stable behavior over those with multiple credit applications.
• Long-Term Impact: Hard inquiries stay in your CIBIL™ report for a long time. Though their appearance will diminish over time, having fewer inquiries will always create a favorable credit impression.

Can You Remove Inquiries from CIBIL™ Report?

Credit inquiries can be categorized into legitimate and fraudulent ones. While the legitimate ones cannot be removed, the fraudulent ones can be removed from your CIBIL™ report by reporting to the CIBIL™ authorities with due diligence.

• Check Your CIBIL™ Report: Start by checking your CIBIL™ report on the official CIBIL™ website. You need to move to the enquiries section. If you notice a particular loan you haven't applied for. Please make a note of it.
• Raise a Dispute with CIBIL™: If you feel that there is a genuine error in the CIBIL™ report, you can raise a dispute with CIBIL™. Do go to the 'Dispute Resolution' section of your CIBIL™ report. Make sure that you provide accurate information. This includes the inquiry date, institution name, and the reason for the dispute.
• Wait for Verification: When you submit a dispute with CIBIL™, you can verify the information. If a particular loan or credit card entry is made in error, it will be removed.
• Timeframe for Removal: If any inaccurate or misinterpreted information is found on your CIBIL™ report, it will be removed within 30 days.

Step-by-Step Process to Remove Unauthorized Inquiries from CIBIL™

Various unauthorized inquiries can hurt your creditworthiness and sometimes are a signal of identity theft. The following is the step-by-step process to remove unauthorized inquiries from CIBIL™.

• Get Your Latest CIBIL™ Report: You can download your latest CIBIL™ report. You can go through the entire report. If you encounter any unauthorized inquiries about the report, you can use this as evidence to complain.
• Verify Whether the Inquiry is Unauthorized: Check the records for authentication. If a family member has applied for credit using your details.
• Contact the Lender: Contact the lender to determine if an inquiry has been made on their behalf. Request them to withdraw the enquiry if the recorder error was made without your consent.
• Raise a Formal Dispute: Visit the CIBIL™ dispute or consumer grievance page on the website and submit a formal dispute against the enquiry. You can also attach the screenshot of the CIBIL™ report, your ID proof, letters/email communications, and any other bank statements showing no application.
• Provide Supporting Documents: Always keep handy any documentation that is required to be submitted. This documentation can include your PAN card, Aadhar card, a copy of the CIBIL™ report, email correspondence with the lender, a copy of the FIR in case of any fraudulent transactions, bank transactions, identity-theft evidence, and so on.
• Follow-up With the Dispute: CIBIL™ will forward your dispute to the lender for verification and investigation. You need to keep your dispute reference and follow-up details.
• File a Police Complaint: If the enquiry on their CIBIL™ report is due to any fraudulent activity or other signs of misuse, file a police complaint and keep a copy of the FIR. Submit this FIR copy to both the lender and CIBIL™.
• Use Formal Regulators to Resolve: If the dispute is not resolved within the stipulated time frame, you can escalate the dispute to higher authorities through the dispute reference number.
• Confirm Removal: Once the inquiry is removed from your CIBIL™ report, confirm this with the lender and download a copy of your CIBIL™ report from all three credit bureaus to ensure consistency in the removal of the inquiry.

How to Prevent Unnecessary Credit Inquiries in the Future

Credit inquiries are unavoidable, especially when you need loans or credit cards. However, too many credit inquiries can harm your credit score and make you appear credit hungry to lenders. You can take simple and practical steps to avoid any unnecessary credit inquiries and protect your credit score.

• Avoid Multiple Applications: Avoid applying for multiple loans and credit cards frequently, and avoid doing so simultaneously. Applying for too many credit projects portrays you as a credit-hungry person in the eyes of the lender. This way, you have a high chance of your loan or credit card applications being rejected.
• Do Eligibility Checks Before Applying: Use lenders' online eligibility checks or make use of pre-approved offers that turn out to be soft enquiries only. This reduces your chances of rejection and prevents unnecessary hard enquiries.
• Monitor CIBIL™ Reports Regularly: Check your CIBIL™ reports regularly. This will amount to a soft inquiry only. Moreover, it helps you to keep a check on any fraudulent or unauthorized enquiries.
• Be Careful with Credit Card Offers: Pre-approved credit card offers will trigger a credit inquiry during the final approval stage. Accept offers only when you are in dearth of one.
• Be Smart with Negotiations: Instead of applying for multiple loans or credit cards at once, consider checking different lenders online to find the best deal.
• Protect Yourself Against Identity Theft: Any fraudulent credit card or loan application always triggers a hard inquiry on your CIBIL™ report. Always keep sensitive details like PAN, Aadhar number, and bank accounts private. If there is an unwanted inquiry, raise a dispute immediately.

Alternative Ways to Improve CIBIL™ Score After Inquiries

CIBIL™ score is one of the strongest indicators of your creditworthiness. It gives you an indication of how responsibly you have used various credit options, like loans and credit cards. Remember, every hard inquiry on your CIBIL™ report will pull down your credit score. So you need to keep track of your credit applications. Even if a hard inquiry has affected your CIBIL™ score, you can still use alternative methods to improve it. They are:

• Track CIBIL™ Report Regularly: You need to track your CIBIL™ report regularly. This will help you find out how your financial decisions are affecting your credit score. And in case there is no positive impact, you can take corrective actions when needed. It will also help you to track any fraudulent or duplicate records on your CIBIL™ report.
• Clear Dues: Make sure you settle all credit card and loan dues on time. Pay the higher overdue or interest amount outstanding. You can negotiate with lenders to work on an alternate repayment plan to pay off your interest.
• Make Timely Payments: You can make on-time payments of your credit card bills and loan EMIs. You can also give an auto-debit mandate to your banker to prevent missing any payments.
• Borrow Wisely: Borrow only when necessary and opt for a loan or credit card that you can manage. Taking on high-value loans might add to your monthly financial strain.
• Use a Secured Credit Card: Having too many defaults might hinder your chances of getting a sound credit card, as you will be considered a high-risk customer. Utilize a secured credit card against a fixed deposit. This way, the bank also has a backing of the fixed deposit for the cards.
• Healthy CreditMix: Maintain a healthy credit mix of both secured and unsecured loans. Apply for a home loan with a low EMI and a consistent repayment history. This demonstrates that you are responsible enough to handle multiple forms of credit.

Conclusion

CIBIL™ inquiries are a prerequisite for getting your credit card and loan applications approved. You would have understood the step-by-step process of rectifying these errors and the various methods to avoid them. You would have also known the multiple tips to improve your credit score after these CIBIL™ enquiries. Regularly check your CIBIL™ report, rectify any related issues, and achieve financial freedom.