New Delhi, March 5 -- In a major step towards improving the timeliness and accuracy of credit reporting, the Reserve Bank of India (RBI) has introduced a new policy mandating banks to report credit bureau accounts on a 15-day cycle from January 1, 2025. This shift from the earlier monthly cycle is expected to give lenders and borrowers a clearer picture of borrowers' financial activity.

Under the new system, the lenders will observe more frequent updates of the credit scores of the borrowers based on their behaviour. This implies that on-time payments or defaults will be captured and reported to the credit bureaus more often, allowing lenders to make better loan application decisions.

For example: If the borrower is making timely paymen...