Document
Document
70% Taxpayers Miss
Saving Taxes!
Plan now to save more taxes!
Enter details to receive communications from ClearTax

error-message

+91

error-message

error-message

Know More About Credit Rating Agencies in India

By Mayashree Acharya

|

Updated on: Feb 18th, 2025

|

3 min read

A credit rating is a numerical measure of an individual’s or business's creditworthiness, playing a critical role in the loan approval process. It indicates whether the borrower has defaulted on previous payments and whether they can be trusted with a new loan. 

In India, leading credit rating agencies include CRISIL, India Ratings and Research, ICRA, CARE, Brickwork Ratings, SMERA Ratings, and Infometrics Valuation.

Know more about credit rating and credit rating agencies here.

What does credit rating mean?

A credit score is a 3-digit number that reflects the creditworthiness of a borrower, while a credit rating assesses the potential risks involved in lending to an individual or business. Lenders use the credit score to decide if the borrower can repay the loan. 

The rating depends on the borrower’s credit history—including past lending and borrowing transactions—along with their assets and liabilities, which reveal their ability to meet debt obligations.

To ensure a good credit rating, it’s important to pay all existing debts on time, monitor your credit report regularly, and maintain a credit utilization ratio below 30%. A strong credit rating increases your chances of securing large loans in the future.

The credit score is determined based on the following factors.

  • Payment History: 35%
  • Credit Utilisation: 30%
  • Credit History Duration: 15%
  • Credit Mix: 10%
  • New Credit: 10%

What is a credit rating agency?

A credit rating agency (CRA) evaluates an individual’s or a company’s creditworthiness by analyzing income and credit lines to determine their ability to repay debt and assess any associated credit risks.

The Securities and Exchange Board of India (SEBI) has the authority to authorize and regulate credit rating agencies under the SEBI Regulations, 1999, as per the SEBI Act, 1992.

How do credit rating agencies work?

Credit rating agencies assess organizations, individuals, or entities and assign ratings based on various factors. These agencies have the authority to rate companies, state governments, non-profits, countries, securities, local government bodies, and special purpose entities.

When determining a rating, factors such as financial statements, debt type, lending and borrowing history, repayment capability, and past credit repayment behavior are considered. Each factor contributes to the overall credit score.

While credit rating agencies do not make decisions for financial institutions on whether to grant a credit facility, they provide comprehensive reports and insights to help lenders make informed decisions.

List of registered credit rating agencies

According to SEBI, the following credit rating agencies are registered and authorised to compute and share credit score/report with the financial institutions and applicants.

  • CRISIL Limited: Credit Rating Information Services of India Limited (CRISIL), one of the oldest credit rating agencies, was set up in 1987. The agency stepped on to infrastructure rating in 2016. CRISIL has been operational in countries such as the USA, UK, Poland, Hong Kong, China, and Argentina in addition to India. The registered address and contact details of CRISIL are: 
    CRISIL Limited 
    CRISIL House Central Avenue 
    Hiranandani Business Park 
    Powai Mumbai 400 076 
    Tel: +91 (22) 33423000 
    Fax: +91 (22) 33423810 
    Email: info@crisil.com
  • India Ratings and Research Pvt Ltd: India Ratings and Research, a wholly-owned subsidiary of Fitch Group, provides accurate and timely credit opinions on the country’s credit market. The firm covers corporate issuers, financial institutions, managed funds, urban local bodies, project finance companies, and structured finance companies. The headquarters is in Mumbai and the other branch offices are in Ahmedabad, Delhi, Chennai, Bengaluru, Hyderabad, Pune, and Kolkata. The registered address and contact details with SEBI are: 
    Wockhardt Towers, 4th Floor, West Wing 
    Bandra Kurla Complex, Bandra 
    East Mumbai 400 051 
    Tel: +91 (022) 40001700 
    Fax: +91 (022) 40001701 
    Email: investor.services@indiaratings.co.in 
    Website: www.indiaratings.co.in
  • ICRA Limited: The Investment Information and Credit Rating Agency (ICRA), a joint venture of Moody’s and Indian Financial and Banking Service Organisation was established in 1991. The organisation is known for assigning corporate governance rating, performance rating, mutual funds ranking, and more.The registered address and contact details of ICRA are given below: 
    1105, Kailash Building, 11th Floor 
    26, Kasturba Gandhi Marg New Delhi 110 001 
    Tel: + 91 (11) 23357940 – 50 
    Fax: + 91 (11) 23357014 
    Website: www.icra.in 
    Email:info@icraindia.com
  • CARE: Credit Analysis and Research Limited (CARE) is a credit rating agency that is operational since April 1993. The agency provides a credit rating that helps corporates to raise funds for their investment requirements. Investors can make decisions based on credit risk and risk-return expectations. In addition to the head office in Mumbai, the firm has regional offices in New Delhi, Pune, Kolkata, Chandigarh, Jaipur, Ahmedabad, Bengaluru, Chennai, Coimbatore, and Hyderabad. The address of CARE’s registered office is given below: 
    4th Floor, Godrej Coliseum 
    Somaiya Hospital Road 
    Behind Everard Nagar 
    Off Eastern Express Highway, 
    Sion (E) Mumbai 400 022 
    Tel: + 91 (22) 566 02871/72/73 
    Fax: + 91 (22) 566 02876 
    Email: care@careratings.com
  • Brickwork Ratings India Pvt Ltd: In addition to registering with SEBI, Brickwork Ratings (BWR) is accredited by RBI and empanelled by NSIC, NCD, MSME ratings and grading services. It has received accreditation from NABARD for MFI and NGO grading. Brickwork is also authorised to grade companies seeking credit facilities from IREDA, Renewable Energy Service Providing Companies (RESCOs) and System Integrators (SIs). Canara Bank was the leading promoter and strategic planner for Brickwork. The registered office address of Brickwork is: 
    3rd Floor, Raj Alkaa Park 
    29/3 & 32/2, Kalena Agrahara 
    Bannerghatta Road, Bangalore – 560 076 
    Tel: +91 (80) 4040 9940 
    Fax: +91 (80) 4040 9941 
    Website: www.brickworkratings.com 
    Email: info@brickworkratings.com
  • SMERA Ratings Limited: SMERA analyses and establishes the credibility of existing micro, small, and medium enterprises (MSMEs). MSMEs can improve, grow, and avail cheaper/faster loans. The registered address SMERA Ratings is: 
    Unit No.102, 1st Floor, 
    Sumer Plaza Marol Maroshi Road, 
    Marol Andheri (East), Mumbai 400 059 
    Tel: +91 (22) 67141144/45 
    Fax: +91 (22) 67141142 
    Website: www.smera.in
  • Infometrics Valuation and Rating Pvt Ltd: This SEBI-registered, RBI-accredited credit rating agency was founded by finance professionals, former bankers, and administrative services personnel. It evaluates entities such as banks, non-banking financial companies, large corporates, and small and medium scale units (SMUs). The rating agency is registered with SEBI under the following address: 
    Flat No. 104/108, 1st Floor Golf Apartments
    Sujan Singh Park, New Delhi 110003 
    Tel:+ 91 (11) 24601142, 24611910, 24649428 
    Fax: +91 (11) 24627549 
    E-mail: vma@infomerics.com 
    Website: www.infomerics.com

Related Articles

Credit Score

CIBIL

CIBIL Score

How to Improve your CIBIL Score?

Equifax Credit Score

CIBIL Registration and Login Process

Can't get yourself started on taxes?
Get a Cleartax expert to handle all your tax filing start-to-finish
Get Cleartax expertise now 

Frequently Asked Questions

What is a credit rating agency (CRA)?

A credit rating agency (CRA) evaluates the creditworthiness of individuals, businesses, and other entities by analyzing their financial stability and ability to repay debts. They assign ratings to help lenders make informed decisions.

Why is a credit rating important?

A credit rating determines the level of risk involved in lending to an individual or business. It influences loan approvals, interest rates, and the terms of credit offered by financial institutions.

How do credit rating agencies determine a rating?

Credit rating agencies assess factors like an entity's payment history, credit utilization, financial statements, lending/borrowing history, and repayment ability to assign a rating.

Which credit rating agencies are registered with SEBI?

SEBI-registered agencies include CRISIL, India Ratings and Research, ICRA, CARE, Brickwork Ratings, SMERA Ratings, and Infometrics Valuation and Rating.

How does a credit rating affect loan approval?

A higher credit rating generally leads to easier approval of loans with more favorable terms. A poor credit rating, on the other hand, may result in loan rejection or higher interest rates.

Can credit rating agencies influence financial decisions?

While credit rating agencies do not make decisions on behalf of lenders, their reports and ratings provide valuable insights that help lenders assess the risk associated with a potential borrower.

How often should I check my credit rating?

It's a good practice to regularly monitor your credit report (at least once a year) to ensure there are no errors or fraudulent activities affecting your credit rating.

How can I improve my credit rating?

To improve your credit rating, focus on making timely payments, reducing credit utilization, and maintaining a healthy balance between your credit types. Additionally, avoid frequently opening new credit accounts.

Help and support
close
Loading Chat ...
Chatbot LogoChatbot Button
About the Author
author-img

Mayashree Acharya

Senior Content Writer
social icons

I am an advocate by profession and have a keen interest in writing. I write articles in various categories, from legal, business, personal finance, and investments to government schemes. I put words in a simplified manner and write easy-to-understand articles. Read more

Clear Logo
Follow us on
FacebookTwitterLinkedInGitHubInstagram
Have a query?
Support
Company
About us
Contact us
Careers
Media & Press
User reviews
Engineering blog
Clear Library
FinTech glossary
ClearTax Chronicles
GST Product Guides
Trust & Safety
Cleartax(Saudi Arabia)

Clear offers taxation & financial solutions to individuals, businesses, organizations & chartered accountants in India. Clear serves 1.5+ Million happy customers, 20000+ CAs & tax experts & 10000+ businesses across India.

Efiling Income Tax Returns(ITR) is made easy with Clear platform. Just upload your form 16, claim your deductions and get your acknowledgment number online. You can efile income tax return on your income from salary, house property, capital gains, business & profession and income from other sources. Further you can also file TDS returns, generate Form-16, use our Tax Calculator software, claim HRA, check refund status and generate rent receipts for Income Tax Filing.

CAs, experts and businesses can get GST ready with Clear GST software & certification course. Our GST Software helps CAs, tax experts & business to manage returns & invoices in an easy manner. Our Goods & Services Tax course includes tutorial videos, guides and expert assistance to help you in mastering Goods and Services Tax. Clear can also help you in getting your business registered for Goods & Services Tax Law.

Save taxes with Clear by investing in tax saving mutual funds (ELSS) online. Our experts suggest the best funds and you can get high returns by investing directly or through SIP. Download Black by ClearTax App to file returns from your mobile phone.

Cleartax is a product by Defmacro Software Pvt. Ltd.

Company PolicyTerms of use

ISO

ISO 27001

Data Center

SSL

SSL Certified Site

128-bit encryption