Actress Sunny Leone recently took to social media to disclose that an unpaid loan of Rs 2,000 was erroneously reflected in her credit report. This minuscule unpaid loan amount affected her credit score; a number ranging between 300 and 900 given to an individual based on their repayment history.
Leonne claims she did not borrow this money, yet the loan was fraudulently attributed to her. Such incidents of fraud can impact your credit score. “Identity theft and credit report errors can affect the credit score of an individual. The liability of repaying such fraudulent loans rests on the individual under whose name the loan reflects and failing to make payments can affect his/her credit score, even under fraud,” says Arun Ramamurthy, mentor of credit helpline AskCred.
Such errors can creep into your credit report—maintained by one of the four credit bureaus in India—due to incorrect reporting by a bank or a financial institution, especially when someone else’s loans is tagged to another individual’s credit report and can hamper the credit score.