Hi everyone,  

 Welcome to the 171st edition of The Pattern, a weekly newsletter where we dive into the latest from the world of economy, technology and finance. Let’s get right into it! 

 In India today, a three-digit number—your credit score—quietly decides the answer. A number between 300 and 900 has become a gatekeeper of modern life, determining your creditworthiness. Whether you’re applying for a home loan, car loan, or even credit cards, lenders first look at your score. Yet, for millions, it remains a mystery which is unseen, unchecked, and misunderstood. 

 A recent study by ZET lays it bare: nearly half of Indian consumers have never checked their credit score. This ignorance translates directly into hidden borrowing costs, silent loan rejections, and missed opportunities. And so, the gap between credit access and credit awareness remains concerning.  

The credit blind spot 

The report shows 45% of Indians have never checked their credit score. The consequences? Many. What doesn’t get measured, doesn’t get improved. Nearly 30% have faced rejections on loans or credit cards, often without being told or clearly understanding why.  

 And then there are the myths: 

• Checking your credit score lowers it.

• Higher income = higher credit score.

• A score between 500–700 is 'good enough'.

• Having more credit cards decreases your score. 

These are a few, and the list goes on! 

The reality is harsher. Only 66% of respondents knew that a score of 750+ is what’s usually considered healthy. One in four had no idea who even calculated their score, and many lacked a basic understanding of how it is generated. Over 58% thought checking their own score would hurt it. Men were more likely to have looked theirs up; women were more likely to underestimate their eligibility for credit.  

“Credit scores decide who gets access to opportunity in India, yet for millions, this number remains invisible or misunderstood. Our study shows that the challenge is not intent, but information," said Manish Shara, co-founder and CEO, ZET. 

A TransUnion CIBIL report stated that India’s credit-eligible population is estimated to be 1,036 million people. Only 27%, around 277 million, actively use formal credit products, and among them, only 119 million actively track their credit profiles. If awareness remains low, these numbers could shrink further, locking millions out of mainstream finance. 

When the system fails 

Credit scores are meant to measure risk, drawing data from repayment histories, utilisation patterns, and credit mix. Four bureaus—CIBIL, Experian, Equifax, and CRIF—convert these into a score that lenders heavily rely on.  

But here’s the painful truth: credit bureaus are often blamed for being opaque, error-prone, and the scoring can also be painfully difficult to contest. The system is not perfect and there are many potential sources of breakdown.  

A missed update from a bank, or a wrongly linked account, can drag down a perfect score, leaving borrowers looking for the answer to why!  

Borrowers can also unknowingly hurt themselves. Missed EMI payments, multiple loan applications in a short time, maxing out credit cards, paying only the minimum due, or even closing old accounts can all dent a score. Ironically, while banks treat these numbers as gospel, consumers often have no idea what is happening behind closed doors.  

In July, due to this lack of transparency, MP Karti P Chidambaram called out CIBIL in Parliament: “There must be greater transparency. The government has missed out on an opportunity to make life easier by reforming these things instead of tinkering in the margins.” His point: borrowers cannot verify whether their records are updated correctly, or appeal against inaccuracies. Farmers, for example, often find that repayments made through subsidies never show up—yet they are considered 'risky' despite clearing dues. 

RBI tries to fix the plumbing  

The Reserve Bank of India has tried to cement some of these cracks. Since January, the central bank has asked lenders to update borrower records every 15 days, rather than monthly, with penalties for delays. A unique borrower ID is also being explored to reduce mismatches. 

Bureaus claim to be strengthening grievance systems and focused on building more inclusive models. “We remain fully committed to resolving every case within the prescribed regulatory timeline,” says Manish Jain, Country MD at Experian. 

But here’s the flaw: bureaus depend entirely on the data lenders feed them. And most consumers don’t even know they can raise disputes—let alone how to do it. 

Think of it as the world’s worst merry-go-round. If a bank forgets to update your repayment, the bureau logs it, and your score takes a hit. You apply for a loan elsewhere, get rejected, try again, and in the process, your score sinks even lower. By the end, the lenders are suspicious, the bureaus are unbothered, and you’re left dizzy, broke, and wondering why this ride never seems to stop. 

Where does this leave India? With a system that is powerful but deeply imperfect. A number that decides the financial future of many but often excludes even more from actualizing their equity in the economic machine.  

Two things must change: 

• First, credit awareness needs to go mainstream. Then, effort must be made to systematically bust the myths around it. Following that, borrowers must learn how to monitor their own scores, and bureaus should focus on increasing literacy around it.

• Second, credit bureaus must make scores easier to understand and challenge if a borrower notices any discrepancy. The bureaus must ensure that the scores reflect genuine behaviour, not arbitrary errors or gaps in data. 

Until then, this three-digit number will continue to silently dominate who gets approved, who gets rejected, and who don’t even know they were being judged in the first place. 

 That's a wrap for this week. As always, leaving you with a few reads to explore. Have a great weekend! 

Reading List: 

1. FinBox raises $40 million in Series B from WestBridge, A91 and Aditya Birla Ventures 

2. Money anywhere, anytime with cash on scan: Cash withdrawals with smartphones are about to become easier 

3. Festive offers, tax cuts to fuel retail lending by banks  

4. Gold loans turn safe haven for low-income borrowers 

5. India Inc turned to non-bank routes for nearly half of FY25 funding  

 Thank you for reading. If you liked this edition, forward it to your friends, peers, and colleagues. You can also connect with me on X here and follow FinBox on LinkedIn to get the latest updates.  

Cheers,  
Mayank