Different Types of Credit Rating Agencies in India

Have you heard about various types of credit rating agencies in India? Have you wondered what they are? 

Credit rating in India is given to every individual who avails of a loan or other credit instrument. It determines if a prospective borrower is creditworthy or not. 

Let’s know more about different types of credit rating in India in this post!

What is a credit rating agency?

In India, you can come across multiple types of credit rating agencies. 

The task of a credit rating agency is to evaluate and assess the creditworthiness of an individual as well as a company. 

The income and credit lines of an individual are taken into consideration to know if a debtor can make timely repayments. It also analyses to know if there is any credit risks associated. 

It is the Securities and Exchange Board of India (SEBI) that has the right to authenticate and control credit rating in India entities. It is done as per the SEBI Regulations, 1999 under the SEBI Act of 1992. 

What are the different types of credit rating agencies in India?

• CRISIL Limited 

CRISIL stands for Credit Rating Information Services of India. It is one of the oldest credit rating agencies and was set up in 1987. Other than in India, CRISIL has also been operational in the USA, UK, Hong Kong, Poland, Argentina and China. 

• India Rating and Research Pvt Ltd

India Rating and Research Pvt Ltd is an owned subsidiary of Fitch Group. Its task is to provide timely and accurate opinions on the credit market of India. It covers issues related to corporates, finances, managed funds, project finance companies, urban local bodies and structured finance companies. 

• ICRA Limited 

ICRA Limited is among one of the leading types of credit rating agencies in India. The full form of ICRA is The Investment Information and Credit Rating Agency. It is a joint venture of Moody’s and Indian Financial and Banking Service Organization. It was established in 1991. It is known for assigning credit ratings related to governance, mutual funds, performance rating and more. 

• CARE

CARE stands for Credit Analysis and Research Limited. It is a credit rating agency, which has been active in India since 1993. It offers credit ratings that assist corporates in raising funds for their requirements for investment.   

• Brickwork Ratings India Pvt Ltd

Brickwork Ratings India Pvt Ltd has received accreditation from NABARD for NGO and MFI grading. Besides being approved by SEMI, this credit rating in India is also accredited by RBI and empanelled by NCD, MSME ratings, NSIC and grading services. It is an entity that can grade companies looking for credit facilities from IREDA, System Integrations (Sis), and Renewable Energy Service Providing Companies (RESCOs). Canara Bank was among the top strategic partners and promoter for Brickwork. 

You are now aware of the different types of credit rating agencies in India. Their principal work is to evaluate the creditworthiness of a company and individuals. 

The importance of these agencies is the same as CIBIL score vs credit score for an individual while looking for a loan. The higher it is, the better is the chance of loan approval at a lower rate. 

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