In a significant update, the Finance Ministry of India has clarified that banks and NBFCs cannot reject loan applications from first-time borrowers simply because they don’t have a credit score.
This move removes one of the biggest hurdles faced by new borrowers and opens doors for personal loans, home loans, education loans, and business loans without a pre-existing CIBIL score.
At Creditsin, we decode what this means, why it matters, and how you can make the most of this opportunity.
In a written reply to the Lok Sabha, Minister of State for Finance Pankaj Chaudhary clarified:
| Myth | Reality |
|---|---|
| You cannot get a loan without a credit score. | First-time borrowers can still qualify based on income and financial profile. |
| No CIBIL score means automatic rejection. | The law prevents lenders from rejecting applicants solely for lack of a score. |
| Only top banks matter. | NBFCs and fintech lenders are equally crucial and often provide faster, flexible approvals. |
Young professionals, students, and families can now apply without fear of rejection due to “no CIBIL score.”
Millions of Indians previously excluded from formal banking can now access loans.
Startups and small businesses, often denied earlier, gain a fair opportunity to fund their ventures.
Even though credit history isn’t mandatory, watch out for these pitfalls:
Use aggregators like Creditsin to compare loans from top banks and NBFCs. This ensures you get the best interest rates, flexible EMIs, and zero hidden charges — without hopping lender to lender.
Start with a small-ticket loan or a secured product like a credit-builder card. Repay on time, and build your credit history step by step.
“No CIBIL required” doesn’t mean “no checks at all.”
Banks and NBFCs will still verify your repayment ability before approving.
Ravi, a 25-year-old professional, secured his first personal loan with salary slips despite no CIBIL score.
Meera, a teacher, bought her first home after her bank approved based on stable income and savings.
Arjun, a young entrepreneur, got working capital approved through an NBFC using GST returns instead of CIBIL.
Processing fees and hidden charges often overlooked.
Scams promising “instant approval” — avoid unregulated lenders.
Borrowers ignoring repayment discipline, which risks future credit growth.
The government’s clarification is a game-changer for Indian borrowers. If you’re applying for your first loan — personal, home, education, or business — the absence of a CIBIL score cannot be the only reason for rejection.
This change will empower students, entrepreneurs, and families to access much-needed credit and gradually build their financial profile.
👉 At Creditsin, we help you compare offers from top banks and NBFCs so you always get the best deal — even without a credit score.
✨ No credit score? No problem. Your financial journey starts with Creditsin.
Disclaimer: The details in this blog are based on the Finance Ministry’s 2025 clarification. Loan approvals are still subject to bank/NBFC internal policies and RBI guidelines. Always read the fine print before committing.
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