In this blog, we will clearly explain how to read and analyze a Commercial CIBIL Report, especially for professionals dealing with working capital loans, business loans, CC/OD limits, and credit appraisal.

Many people judge a borrower only by looking at the CIBIL score. However, in commercial lending, the real picture lies inside the detailed report. This guide will help you understand how bankers actually interpret credit behavior and risk.

What Is a Commercial CIBIL Report?

A Commercial CIBIL Report reflects the credit history of a business entity, such as:

  • Proprietorship firms
  • Partnership firms
  • LLPs
  • Private or Public Limited companies

It captures information related to:

  • Working capital facilities
  • Term loans
  • Cash credit and overdraft limits
  • Bank guarantees and LCs
  • Repayment discipline across lenders

Understanding Commercial CIBIL Rank (CMR)

Instead of a numeric score, commercial borrowers are evaluated using Commercial Rank (CMR):

CMR Rank Meaning
CMR 1 Excellent credit profile
CMR 2–5 Acceptable / Average
CMR 6–7 Caution zone
CMR 8–10 High credit risk

Generally, banks are comfortable up to CMR 5. Beyond this level, lenders become cautious and demand deeper analysis.

Do Not Judge Only by the Rank

A lower rank does not always mean poor credit quality.

Practical Example

A business with:

  • ₹40–50 crore annual turnover
  • All loan accounts running standard
  • No current defaults

Still showed a weak Commercial CIBIL ranking.

Reason:
A small loan taken in 2009 for ₹50,000 remained unpaid and continued to be reported as a default, impacting the overall profile.

Key lesson:
Always read the full report before forming any judgment.

Key Sections of a Commercial CIBIL Report

1. Basic Business Information

This section includes:

  • Business name
  • Registered office address
  • Contact details
  • Business constitution

Always verify these details with bank records. Even minor spelling variations can create confusion

2. Identification Details (PAN, GST, CIN)

This is one of the most critical sections.

Multiple PAN Issue

In many cases, the report may show:

  • Multiple PAN numbers
  • Partner PANs merged with firm data
  • Similar-name entities mixed together

This can result in inflated loan exposure that does not actually belong to the borrower.

How to Resolve Multiple PAN Errors

If incorrect facilities appear:

  1. Email Commercial CIBIL customer support
  2. Clearly mention the correct entity PAN
  3. Request a consolidated and corrected report
  4. Ask for separation of unrelated PAN data

A corrected report is usually issued within 3–4 working days.

Credit Profile Summary

This section gives a quick overview of:

  • Total credit exposure
  • Secured vs unsecured loans
  • Delinquency amount
  • Number of lenders

Bankers often form an initial opinion based on this snapshot.

Loan Enquiry Analysis

This section shows how frequently the borrower has applied for loans.

High enquiry volume within a short period may indicate:

  • Cash flow stress
  • Over-leveraging
  • Aggressive borrowing behavior

Credit Facility-Wise Analysis (Most Important Section)

Each loan must be analyzed individually based on:

  • Facility type (CC, OD, Term Loan)
  • Sanctioned limit
  • Outstanding balance
  • Asset classification
  • Days Past Due (DPD)

Never assume risk without understanding the nature of delay.

Understanding CC / OD Over-Utilization

If a CC limit of ₹60 lakh shows an outstanding of ₹60.28 lakh, it is not necessarily a default.

Common reason:
Month-end interest debit causing temporary excess.

What to check:

  • Bank statement
  • Duration of over-utilization
  • Whether it is habitual or occasional

Term Loan Repayment Behavior

In term loans:

  • EMI delays are more serious
  • 30, 60, and 90 DPD levels must be reviewed carefully

One-time delays should be differentiated from continuous defaults.

Restructured Loans – How to Interpret Them

If a loan is marked as:

“Restructured due to natural calamity or Covid”

Do not panic. During Covid, many genuine businesses opted for restructuring.

Focus instead on:

  • Post-restructuring repayment discipline
  • Current loan performance

Legal, Suit Filed, and Write-Off Section

This section discloses:

  • Suit filed cases
  • Wilful default status
  • Settlements
  • Write-offs

A clean legal section is a strong positive indicator.

Group Exposure and Relationship Mapping

Commercial reports also help identify:

  • Group companies
  • Common promoters
  • Cross guarantees

This reveals hidden exposure that borrowers may not disclose verbally.

Final Conclusion

To correctly evaluate a borrower using Commercial CIBIL:

  • Do not rely only on rank
  • Study each loan facility carefully
  • Verify CC/OD behavior with bank statements
  • Identify and correct data mismatches
  • Understand business context behind restructuring

Strong credit appraisal always depends on detailed analysis, not assumptions.