Everything You Need to Know About Credit Bureau Report in Singapore

Everything You Need to Know About Credit Bureau Report in Singapore

Credit bureaus are one of the most important factors when it comes to loan applications. Also known as consumer reporting agencies (CRA), Credit Bureaus in Singapore are organizations that conduct the collection, research, and data analysis of the credit information of loan applicants. This information, referred to as the Credit Bureau Report is sold to loan providers, allowing them to make an informed decision when it comes to approving loans.

An example of a credit bureau in Singapore is Credit Bureau Singapore Pte Ltd (CBS). This Credit Bureau Singapore is a joint venture between The Association of Banks in Singapore (ABS) and Infocredit Holdings Pte Ltd. Featuring credit information from every retail bank and major financial institutions across Singapore is one of the most comprehensive consumer credit bureaus in Singapore.

There are numerous credit bureaus in Singapore, aside from the one mentioned previously in this article. This credit report bureau sign deals with banks, credit facilities, and other financial institutions that require their services. The information collected by credit bureaus is also known as a credit report.

What is Credit Report?

A credit report is a document that contains financial information about a person. It includes necessary information about the person they are profiling, such as name, address, age, occupation, phone number, social security number, birthday, etc.

Aside from that, a credit report also contains a credit file and information on a person’s credit activities. This includes recent loan application enquiries, credit history of delinquent payments, and current financial status. It also consists of a person’s credit score, which will be discussed in further detail later in this article.

As you can see, the information on credit bureau reports is mainly an assessment of how right a person is when it comes to their financial situation. A credit report’s primary function is to assess the ability of a credit applicant to pay for new loans (or fail in their payments.) It is mainly utilized by credit facilities and other credit facilities that offer loan products. However, it can also be used by individuals to assess how financial institutions perceive them, allowing them to apply for loans that they will surely get approved.

There is no single credit report for a person, since retail banks and other credit facilities use different credit reporting agencies, and various Credit Bureau Singapore produce their stories. Credit reports are a comprehensive breakdown of a person’s credit history rating made by a credit agency. Credit Bureau Singapore gathers financial details about individuals, which they use to produce credit reports. Banks, money lenders then use this credit bureau report, and other financial institutions to identify whether a loan applicant is a right candidate.

What is Credit Score?

A credit score is the numerical assessment of an individual’s creditworthiness. It rates individuals based on the chance that they will not pay their loans. This credit score is an independent rating of a CRA.

Credit scores released by the credit bureau in Singapore have a range of 1000 to 2000. 2000 is the highest rating of creditworthiness, while 1000 is the lowest, meaning that applicants with scores close to 1000 have the highest chance to default on their loan. The complete CBS credit score table can be found below.

Score Range Risk Grade Probability of default
Min
Max
1911-2000
AA
0.00%
0.27%
1844-1910
BB
0.27%
0.67%
1825-1843
CC
0.67%
0.88%
1813-1824
DD
0.88%
1.03%
1782-1812
EE
1.03%
1.58%
1755-1781
FF
1.58%
2.28%
1724-1754
GG
2.28%
3.46%
1000-1723
HH
3.46%
100.00%

The credit score is not the sole factor used by the credit facility on deciding on your loan inquiry. Other factors include the outstanding loans on your name, your credit history, income, job stability, and filing of bankruptcy.

As stated earlier in this article, there is no single credit report that determines financial status. Similarly, there is no single credit score tied to someone’s name. If a credit facility or member banks in Singapore rejected your loan application, you could try again at another loan provider that uses a different credit reporting agency.

Benefits of Maintaining a Good Credit Score

credit rating

Besides the more obvious benefit of keeping a good credit score in Singapore (getting approved quickly for loans you apply for), there are other advantages of having a clean and superb credit history. Listed below are some of them:

  • Be Eligible for Superb Credit Card Offers

A solid credit ranking in Singapore will allow you to acquire excellent credit card deals to a major credit facility like member banks that are not offered to people with a low credit score. We are talking about credit cards with low-interest rates, cashback benefits, rewards, and other perks. You will be able to save more money with these cards compared to standard cards.

  • Get Lower Down Payment for Utilities

When availing utility services such as the internet, water, or electricity, the utility company will often ask for a security deposit or downpayment. If you have an excellent credit score, the downpayment can be reduced or removed entirely in some cases.

  • Get Better Auto Insurance Premiums

There are insurance companies that use credit reports and credit score assessment to project potential losses on defaulting customers. If you have a high credit score, the car insurance company will not perceive you as a possible loss. A car insurance company will not turn down applicants just because they have a bad credit score. However, they can certainly increase the insurance premiums of customers that they perceive as “high risk.”

  • Get Accepted Into Flats Easily

Like lenders, landlords often use CRAs to review the financial status of applicants who want to move in. By having a good credit score, you will be accepted easier. A landlord can still take you as a tenant if you have a bad credit score. However, they can increase your security deposit to negate the risk. They can also require you to have a co-signer on your lease contract.

What Affects Your Credit Score?

Now that you are aware of the importance of keeping a positive credit score, let’s discuss how a credit score is developed (or ruined.) In this section, we will consider the factors that affect your credit score, either positively or negatively.

  • Usage Pattern

How you used your past loans is one of the factors that affect your credit score. Did you use your prior loan to purchase gadgets or to fund a luxury vacation? Did you use it for an emergency, for a car repair, or an investment? Did you use the loan to splurge on a casino? The pattern in which you utilize your loans affects your credit score. An individual who uses a personal loan to fund their casino sessions will have a lower credit score than an individual who uses loans for investment purposes. This factor is not the only factor that influences the total credit score. The negative effect can often be mitigated if you are a good payer with a clear payment history.

  • Recent Credit Applications

Another factor that affects your credit score is the new loan applications and inquiries that you made. Any loan facilities worth their salt will conduct a basic search on the applicant’s credit file history, and current credit applications can have a negative effect.

Luckily, it is easy to compensate for the negative effect that loan applications have on your credit score. Even if you made a lot of applications quickly, you could continue paying your bills on time, settling your monthly obligations with other loans, and not neglecting your payments. Also, it is entirely reasonable to have a few credit inquiries on your name every few months, since the majority of people borrow money at some point.

What you should avoid is making a lot of loan applications within a short period. Applying for multiple loans is a sign that you are desperate for a loan, and it also means that you are struggling with your finances. Loan providers perceive that as a risk on your credit file that you will not be able to maintain paying for your monthly payments.

  • Available Credit Accounts

The number of credit accounts that you have opened under your name also affects your credit score. Thus, it is not recommended to close a credit account even if you don’t use it anymore. Keep that account to boost your available credit account.

Closing your unused account can also lead to a decrease in credit score. Having a tasty variety of credit accounts will make you very attractive to loan facilities since it will show that you can handle multiple credit accounts properly. We will discuss the diversity of credit accounts more in the next point.

  • Diversity of Credit Account

Having a diversified credit account is another strength that is a plus on your credit score. It would help if you tried to maintain different types of credit, such as personal loans, car loans, mortgages, credit cards, and other bills. A diversified credit account is a testament to your ability to handle your finances. As long as you are updated on the payments on all of your credit accounts, it will positively reflect your credit score.

  • The Age of Your Credit Accounts

Aside from having a great variety of credit accounts, their age is also an essential factor. The age of your credit accounts is a testament to your ability to maintain them. As such, having older accounts will contribute significantly to a higher number on your credit score. This is another reason why you shouldn’t close your old credit accounts even if you don’t use them anymore, as we stated earlier in this article. Closing a credit account will erase an aged credit account from your record, while also decreasing your credit diversity. Closing a credit account that you maintained well over the previous years is a detriment to your credit score.

  • Account Delinquency (Late Payment) Data

The late payments you made recently harm your credit score. Late payments are a big red flag for credit bureaus since they are an indication that an individual is struggling with their previous or current loans. If loan providers such as banks and licensed moneylenders saw that you had some recent delinquent payments, they are not going to approve a considerable loan amount for you, or they might even reject your loan application outright.

Where Can I Get My Credit Report?

man creating a credit report

As outlined in this article, credit reports are relevant documents that will help your decision making when it comes to applying for loans. If you are interested in getting a copy of your credit report, we got you covered. You can ask for a copy of your credit report on this website. It costs $6.42 to purchase a CBS Credit Report, with an additional $2 if you want to avail of other delivery methods. Additionally, you can request for it branches of SingPost, and you can get it in just 2 hours.

This is perfect if you need a copy of your credit report as soon as possible, with only an added drawback of an extra $1.00. You can also avail of a CBS credit report by visiting the office of Credit Bureau Singapore or CrimsonLogic Service Bureaus.

For transactions made on physical branches, cash, Visa, Mastercard, and eNets are accepted. Meanwhile, Visa, Mastercard, and eNets are required for online purchases.

Conclusion

Once you have information on your credit score, it is time to seek out loans that you can apply for. Knowing your credit report and credit score will allow you to narrow down the list of loans that you can get approved for. Loan Advisor will be a great help in that endeavor. Featuring detailed information on most loan offers by various loan providers in Singapore, Loan Advisor will make the process of loan hunting extremely easy.

Additionally, Loan Advisor does not require comprehensive credit reports compared to other websites with the same purpose. For this reason, Loan Advisor can still be used even if you don’t have access to a comprehensive credit report.

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