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Upholding the single judge order, the division bench of the Kerala High Court ruled that credit information companies (CICs) like TransUnion CIBIL Ltd do not update the CIBIL information at the time of credit worthiness, which can affect the borrower's basic rights like dignity and respect. In its order last week, a division bench of Justice A.K. Jayasankaran Nambiar and Justice Shyam Kumar V.M. said that credit institutions have to mandatorily become a member of CICs like TransUnion CIBIL and obtain credit ratings of their customers from such companies. The CIC action is an inherent activity that can affect the reputation of a borrower like this applicant. Therefore when a CIC fails to timely update the credit information of a borrower from a credit institution it affects the reputation of the borrower as well as the applicant equally. The dignity of a borrower is an integral aspect of his dignity and privacy, which is today recognized not only as a common legal right but also a fundamental right under Article 21 of our Constitution.
Under the legal scheme of the Credit Information Companies (Regulation) Act, 2005 (CICRA), it is TransUnion CIBIL which has the expertise to assign credit rating to a borrower from a credit institution like the one in the writ petition. Failure of TransUnion CIBIL to reflect the true creditworthiness of the applicant at any time if the applicant's credit rating has not been updated would affect the fundamental rights of dignity and reputation of the applicant.
