Credit score is calculated by Credit Information Companies. In India, there are 4 companies that perform this job. Equifax is one among them, and we give you your Equifax Credit Score. Now let’s try to understand how these companies actually calculate the credit score.

When you make a transaction - the ones that are relevant to calculating your credit score - banks forward the details of it to all four credit agencies. It is a compulsion made by regulators for banks to share information with the credit agencies. Essentially, banks keep the Credit Information Companies updated about your monetary habits. Whenever a bank needs to check your credit score, they can reach out to any one of the bureaus. It doesn’t matter which one they approach because all four are equally at par with each other and would reflect nearly the same result for you.

After receiving information from the bank, credit bureaus get down to the task of collecting more information about your financial habits from other banks and financial institutions. The credit bureaus then process this information to formulate what is called a credit report.

So, now you must be wondering what a credit report is.

It is nothing but your financial report card. Remember the ones you used to get in school? A credit report is similar, but it contains your credit score instead of academic grades. It’s wiser to check your score from time to time, preferably on a yearly basis.