Credit Score is a numerical expression of your creditworthiness. A good credit score assures lenders, like banks and NBFCs, that you are capable of paying back the borrowed amount. It could also entitle you to better deals like lower interest rate, higher credit limit, higher loan amount and longer tenure.
Credit score is evaluated by Credit Bureaus based on analysis of your credit history. Financial institutions, like banks and NBFCs, can check an individual's credit score with any of the bureaus.
Closing this loop, details about all your transactions, relevant to credit score calculation, are sent to the credit bureaus by banks and NBFCs. They have been mandated by the RBI to do so.
Credit bureaus track information like credit mix, credit utilization, credit balance, new credit, tenure, and repayment history. They collect this information, formulate a Credit Report, and assign your credit score.
There are four credit bureaus, or credit information companies, licensed by the RBI in India. They are the Credit Information Bureau (India) Limited (CIBIL), Experian, Equifax and CRIF High Mark.
All credit bureaus have their own scoring system but their evaluation stands irrespective of which one gives the credit score. Most common in India is a CIBIL credit score which is a three digit number ranging between 300-900.