Disclosure in Parliament, Does CIBIL Score Affect Job Too

CIBIL Score: For a long time, there has been a common belief that the CIBIL score matters only for loan and credit card approval. But now the recent discussion in Parliament has made it clear that this score can also play a role in getting a job. Especially in the banking sector, during the recruitment process, the candidate’s credit history is closely monitored.

What is a CIBIL score and how is it made:

CIBIL score is a three-digit number ranging between 300 to 900. It indicates a person’s creditworthiness and is based on their loan repayment capacity and credit card usage pattern. In India, it is issued by TransUnion CIBIL Limited. Earlier, it was called Credit Information Bureau (India) Limited. Apart from CIBIL, three more credit bureaus work in India – Experian, Equifax and CRIF High Mark, which collect and keep financial information safe in a similar way.

What do the rules say in banking jobs:

Rajya Sabha MP, Dr. John Brittas recently raised the question of whether a CIBIL score of 650 is mandatory to get a job in the banking sector. Minister of State for Finance, Pankaj Chaudhary, while answering this, clarified that this condition has been removed from the recruitment process of 2024-25 (CRP-14). However, the candidate will have to show his credit history clean and updated credit history before joining the job. If the record is not updated, then the candidate will have to take NOC from the loan-giving institution; otherwise, the bank can cancel the offer letter.

Earlier 650 score was mandatory:

By the year 2023-24, the Institute of Banking Personnel Selection (IBPS) had implemented the rule that the candidate should have a CIBIL score of at least 650. This rule had especially troubled the middle class and poor students, who were facing difficulty in repaying the education loan.

Why was this rule considered necessary:

The Government argues that employees in the banking sector handle public money and sensitive transactions. If the candidate himself is not financially disciplined, then it may be difficult to trust him. That is why the CIBIL score was considered a measure of their credibility and financial discipline.

Source : https://www.timesbull.com/business/disclosure-in-parliament-does-cibil-score-affect-job-too-581106.html