What is DPD in a credit report and why does it matter? | Mint

Credit card holders and loan lenders must ensure that the refund is made before or on the expiration date. Timely payments help to maintain and/or improve the creditworthiness. A good credit rating is important to get new credit cards and loans. As the new credit applications are processed, banks look at the applicant of the applicant’s previous repayment record. This can be detected by the parameter (DPD) in the credit report. In this article we will understand what DPD is, different values ​​reflected under DPD status in the credit report, and its implications. What is the DPD status in a credit report? The days of recent times or DPD status in a credit report reflect the number of days by which a credit card holder or loan lender has delayed a refund. Banks report the repayment status for outstanding credit card and loan EMIs to Credit Information Enterprises (CICS) such as Cibil on a bi -weekly basis according to RBI guidelines. The CICS likes Cibil processes the information and works it up in the individual’s credit report. The credit report gives a monthly repayment status of each credit instrument used by the borrower. Suppose, for example, an individual has a credit card from HDFC Bank. The credit report reflects the monthly payment status for the card. The status has been displayed monthly over the last 36 months, from the latest month. DPD status in credit report makes us understand how the DPD status is reflected in the credit report and the meaning of each status. The monthly DPD status in the credit report shows one of the following. DPD status 0: If the DPD status is displayed for any month if 0, it means that the refund was made before or on the expiration date. You should always be aimed at making each refund before or on the expiration date. If you do, the bank reports the DPD status as 0 to the CIC, and the CIC further works the same as 0 in your credit profile. If you make refunds on time month after month, you demonstrate a good repayment record. The DPD status as 0 reflects good credit behavior. If you are applying for a new credit card or loan, the bank will check your credit report for the previous payment record. If they see a good payment record, the chances of the credit application be approved. Timely repayments have the highest weight in calculating your creditworthiness. So if your DPD status is 0 with each month passing, it contributes to improving your creditworthiness. DPD status xxx: In some months you see the DPD status displayed as XXX. This means that the bank did not report your repayment status to the CIC for that particular month. You don’t have to worry about it because it has no negative implication on your creditworthiness. If your DPD status is something different from 0 or XXX, you should look further. Let us understand how the DPD is calculated in the case of delayed repayment (s) before examining this status. DPD calculation When an outstanding loan or outstanding credit card is delayed beyond the deadline, the DPD is calculated as follows. The DPD is the difference between the current date and the expiration date. For example, the current date is May 1, 2025, and the repayment of the EMI loan was April 1, 2025, and the repayment of the EMI is still pending. The DPD is the number of days between the current date and the expiry date of the EMI refund. In this case, the DPD is 30 days. The bank will report the 30 -day delay to the CIC, and the CIC will update the DPD for 30 days in the lender’s credit report. Any repayment delay will negatively affect your creditworthiness. DPD status for delayed payments, let’s understand the DPD status for a delayed repayment. Depending on the duration for which a refund has been delayed, the DPD status will be as follows. STD: The DPD status as STD or standard means that the repayment delay is less than 90 days. Each repayment delay negatively affects the creditworthiness. However, since the account is still standard, the impact can be less severe. Sub: The DPD status as sub- or substandard means that the repayment delay is more than 90 days. According to RBI guidelines, a credit account where the delay crossed 90 days is classified as a non-performing asset (NPA). DBT: The DPD status as DBT or questionable means that it remained a substandard account for a period of 12 months. The probability of collection from a questionable account is low. LSS: The DPD status as LSS or loss means that a loss has been identified and remains unfamiliar. Impact of DPD status on new credit applications When you apply for a new credit card or loan, the bank will check your credit rating and profile. In the credit profile, they will check the DPD status of your existing/closed credit cards and loans. If the DPD status of all repayments in the past is 0 or XXX, it will be seen positively. The chances of the new credit application be approved will increase. If the bank encounters any DPD status except 0 or XXX, it will check further details. A DPD status such as STD, sub, DBT, LSS, etc., can reduce the likelihood of the new credit application being approved. How to increase and maintain a good credit rating? You need a good credit rating to improve the chances of your credit card or loan application being approved. A few steps to increase and maintain a good credit rating include the following. Timely refunds: Always pay the outstanding credit card and loan EMI on or before the deadline. This will ensure that the DPD status is 0. Lower credit consumption ratio: The credit consumption ratio measures the percentage of credit used from the available credit limit. A credit utilization ratio of 30% or lower is considered good. Healthy Credit Mix: An individual must have a healthy credit mix of safe loans (for example, home loan, vehicle loan, etc.) and unsecured loans (for example credit card, personal loan, etc.) make one credit application at a time: An individual must apply one credit application and wait for the bank to give his decision. Within a short period, several applications by banks are considered credit hungry behavior. A person must check their credit report regularly. They need to monitor the DPD status and other details. If the DPD status is something different from 0 or XXX, it must be further checked. Always make payments on time so that the DPD status is 0. It helps to contribute to raising the creditworthiness and keeping it healthy. It also increases the chances of new credit applications being approved. Gopal Gidwani is a freelance writer for personal finance with 15+ years of experience. He can be reached at LinkedIn.