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The Reserve Bank of India has rolled out a new rule requiring banks and financial institutions to update credit records every 15 days instead of once a month.
With the latest RBI rules, a missed payment could affect your credit score sooner than before, potentially impacting your ability to borrow in the future.
Starting January 1, borrowing from multiple lenders will become a lot harder. The Reserve Bank of India (RBI) has rolled out a new rule requiring banks and financial institutions to update credit records every 15 days instead of once a month. This move aims to give lenders a clearer picture of your financial health, making it tougher for borrowers to over-leverage themselves with multiple loans.
What’s Changing?
Until now, lenders updated your credit information with credit bureaus once a month. This meant there could be a gap of up to 40 days before a missed payment or a new loan reflected in your credit score. Under the new system, your financial activity will show up in the records within two weeks.
“This ensures lenders have a clearer, more current view of a borrower’s credit behaviour,” said Sachin Seth, Chairman of CRIF High Mark, a credit information company, as quoted by The Times of India. He added that it also helps prevent delays in reflecting defaults or payments, which improves the quality of credit evaluations.
“Equated monthly instalments (EMIs) are scheduled on various dates across the month. A once-a-month reporting cycle could delay reflecting defaults or payments for up to 40 days, resulting in outdated data for credit evaluations. Switching to a 15-day reporting cycle would significantly reduce these delays. More frequent updates allow lenders to capture defaults or payments more accurately and closer to real-time,” said Seth,, according to TOI.
Why This Matters for Borrowers
If you’ve ever taken out multiple loans, you know how easy it can be to lose track of payments. But, frequent updates mean lenders will now have a more real-time snapshot of your financial activity.
For example, someone who takes personal loans from multiple lenders — often exceeding their repayment capacity — will now have their borrowing history reflected faster in the credit system. This reduces the chances of new loans being approved while older ones remain unpaid.
In a recent interview with TOI, SBI Chairman C S Setty highlighted the risks of over-borrowing and said new-to-credit borrowers sometimes take loans from multiple lenders, sometimes more than they can repay. “This (the new system) is likely to tone down multiple borrowings by the same individual,” he said.
A Step Towards Responsible Borrowing
The updated reporting cycle also targets risky financial practices like “evergreening”, where people use new loans to cover old defaults without the system catching on. By cutting the reporting cycle in half, lenders can detect such behavior faster, reducing the risk of bad loans.
What Should Borrowers Do?
For borrowers, this means it’s more important than ever to keep track of repayments. A missed payment could affect your credit score sooner than before, potentially impacting your ability to borrow in the future.
On the flip side, if you’re diligent about repaying your loans, this system could work in your favour. Positive behaviour, like timely EMI payments, will reflect more quickly in your credit report, improving your credit score.
Why It’s Good News for the Economy
Frequent credit updates aren’t just a win for lenders – they also make the credit ecosystem healthier. With better data, banks can lend more responsibly, reducing the chances of defaults and financial instability.
Globally, many advanced economies already use more frequent credit reporting. By adopting this practice, India is aligning its financial system with global standards.
As borrowing becomes more transparent, both lenders and borrowers stand to benefit. But, for anyone planning to take out loans in 2025, it’s time to be extra mindful of your financial commitments.
