What is a soft credit inquiry on your credit report, and why does it matter

A soft credit inquiry, also called a soft pull, is a type of credit check that does not impact your credit score. As lending in India evolves and borrowers become more credit-aware, understanding the difference between soft and hard inquiries has become essential for maintaining financial health.

Soft inquiries typically occur when lenders run preliminary background checks or when you access your own credit report. 

What exactly is a soft credit inquiry?

A soft inquiry is simply a background review of your overall credit profile. It does not affect your credit score and is visible only to you, not to future lenders. Soft pulls occur in situations such as:

• When you check your own credit score on platforms like CRIF High Mark, CIBIL, Equifax, or Experian.
• When banks or NBFCs generate pre-approved loan or credit card offers.
• When employers run background checks.
• When digital lending apps perform initial eligibility checks or verify basic details like name, defaults, or debt-to-income ratio.

These inquiries are harmless because they are not tied to a formal credit application. If you spot any discrepancies, you can raise them with your credit bureau.

Soft vs hard inquiries

A hard inquiry is triggered when you formally apply for a loan or credit card. This involves deeper verification of your financial profile before approval. Multiple hard inquiries in a short period may signal credit-hungry behaviour and can temporarily reduce your score. Soft inquiries, by contrast, are informational and do not influence credit scores.

Key factors to keep in mind

• Impact on score: Soft pulls have no impact. Hard pulls can remain on your report for years.
• Visibility: Soft inquiries are visible only to you, while hard inquiries are visible to lenders.
• Purpose: Soft inquiries are for background checks; hard inquiries are for evaluating loan or credit applications.

Why soft inquiries matter for borrowers

As digital lending rises, regularly checking your credit report through soft pulls helps you track inaccuracies and monitor your credit health without hurting your score. There is no downside to a soft inquiry.

Disclaimer: MintMoney has a tie-up with fintechs for providing credit. You will need to share your information if you apply. These tie-ups do not influence our editorial content. This article only intends to educate and spread awareness about credit needs like loans, credit cards, and credit scores. MintMoney does not promote or encourage taking credit, as it comes with a set of risks, such as high interest rates, hidden charges, etc. We advise investors to discuss with certified experts before taking any credit.