Hard vs Soft Credit Inquiry: What Really Impacts Your Credit Score in India

Ever been warned, "Don’t apply for too many credit cards or loans, it might mess up your score"? Most of us have. And while the warning is valid, not everyone understands why that happens. The answer lies in something simple but often misunderstood: credit inquiries. More specifically, the difference between hard inquiries and soft inquiries.

Think of your credit report like a resume. Sometimes someone just glances at it (a soft check), and other times, they scrutinize every detail (a hard check). And depending on which type it is, your credit score might take a hit — or remain completely untouched. In this article, let’s break it down and help you get a clearer sense of how your credit score behaves in the Indian context.

What Is a Credit Inquiry?

In plain terms, a credit inquiry happens when someone checks your credit report. This report contains details about your borrowing history, outstanding loans, repayment track record, and more.

Who typically checks it? Banks, NBFCs, credit card issuers, and fintech lenders like us at Quicklend.

Why does it matter? Because it directly influences your ability to get a loan or a credit card. Lenders use this report to decide whether to approve your application, set your credit limit, or decide the interest rate.

Hard Inquiry vs Soft Inquiry: The Core Differences

Both types of inquiries involve someone looking at your credit report. But their intent and impact are completely different.

Why Multiple Hard Inquiries Can Hurt Your Score

When a credit bureau like CIBIL sees multiple hard inquiries over a short period, it may flag you as "credit-hungry". In the lender’s world, this means you're actively seeking debt, which could make you look like a risky borrower.

Each hard pull may lower your score by 5-10 points. It might not seem like much, but here’s what it looks like:

Say you apply for 3 different credit cards in one week. Each bank performs a hard pull. Your score could drop by up to 20-25 points — enough to shift your creditworthiness from "Good" to "Average".

This is why you should always be cautious about how many loans or cards you apply for in a short span. Read more about how to bounce back from a low or bad credit score in this detailed article by the Quicklend team.

When Are Hard Inquiries Okay (and Even Necessary)?

It’s not like hard inquiries are always bad. In fact, they’re essential whenever you seriously apply for credit:

• Taking a home loan from SBI
• Applying for a car loan from a dealer
• Opting for a Loan Against Mutual Funds

Bureaus are smart too. If you're rate-shopping — meaning comparing loan offers within a short period (typically 15-30 days) — they may club those inquiries as one. This reduces the negative impact on your score.

How to Minimize Negative Impact on Your Credit Score

Here are some smart habits that can protect your credit profile:

• Check before you apply: Always ask if it’s a hard or soft inquiry.
• Space out your applications: Don’t apply for multiple loans or cards all at once.
• Use RBI-regulated lending service providers like Quicklend that disclose their inquiry methods.
• Monitor your score regularly through soft-inquiry platforms like CIBIL or Experian.

Quick tip: When in doubt, just ask your lender, "Will this be a hard inquiry on my credit report?"

Conclusion: 

Knowing the difference between soft and hard credit inquiries may seem minor, but it gives you an edge when navigating India’s credit landscape. Whether you’re rate-shopping for a car loan or simply checking your score, these small actions can add up to a healthier credit profile.

So the next time you're exploring loan options, take a breath, ask the right questions, and go with a lender that keeps you informed.

This is general guidance. For personalized loan advice, contact our team at Quicklend.