How Many Credit Rating Agencies are There in India

Introduction

Seven credit rating companies exist in India: CRISIL, CARE, ICRA, SMREA, Brickwork Rating, and India Rating and Research Pvt. A credit rating is an evaluation of a borrower's creditworthiness, either generally or in relation to a specific debt or financial obligation. It can be given to any organisation looking to borrow money, including individuals, businesses, state or local governments, and corporations. Credit rating is far from a simple mathematical calculation because determining an individual's creditworthiness requires both qualitative and quantitative evaluations.

Credit Rating Agency

A company that assigns credit ratings is known as a credit rating agency (CRA, also known as a rating service). These ratings assess a debtor's capacity to repay a loan by making timely principal and interest payments as well as the likelihood of default. The creditworthiness of individual consumers cannot be rated by an agency, only that of issuers of debt obligations, debt instruments, and, in some cases, debt servicers.

In India, credit rating agencies were founded in the second half of the 1980s. The SEBI (Credit Rating Agencies) Regulations, 1999 of the Securities and Exchange Board of India Act, 1992 govern credit rating agencies (CRAs) in India.

Credit Rating Information Services of India Limited (CRISL)

One of the first credit rating companies in India was founded in 1987 and is called Credit Rating Information Services of India Limited (CRISIL). In addition to India, it is operational in the UK, the USA, Poland, China, Hong Kong, and Argentina. It evaluates the creditworthiness of commercial entities on the basis of their strengths, market reputation, market share and board. It provides credit ratings for businesses, organisations, and banks to assist investors in making knowledgeable investment decisions. Starting in 2016, CRISIL has also ventured into infrastructure rating.

Investment Information and Credit Rating Agency (ICRA)

Established in 1991 and headquartered in Mumbai, the Investment Information and Credit Rating Agency of India uses a transparent rating system to assign comprehensive credit ratings to corporates. Corporate governance ratings, mutual fund ratings, structured finance ratings, performance ratings, etc. are all given by ICRA.

Credit Analysis and Research Limited (CARE)

In April 1993, Credit Analysis and Research Limited (CARE) began operations. Its regional offices are located in New Delhi, Kolkata, Pune, Chandigarh, Ahmedabad, Jaipur, Bengaluru, Coimbatore, Chennai, and Hyderabad in addition to its Mumbai headquarters. Short-term and long-term debt instruments are the two categories of bank loans that CARE offers ratings for. Investors can use its credit ratings to make educated decisions based on expectations for the risk-return trade-off and credit risk. Additionally, it can aid businesses in obtaining the funding they need for investments.

Acuite Ratings & Research (earlier SMERA Ratings Limited)

The 2011-founded Acuite Rating & Research was formerly known as the Small Medium Enterprises Rating Agency Of India Limited. Its two primary divisions are SME Ratings and Bond Ratings. It evaluates the reliability of the current MSMEs (Micro, Small, and Medium enterprises).

Brickwork Ratings (BWR)

Brickwork Ratings (BWR) is not only registered with SEBI but also accredited by RBI, empanelled by NCD, NSIC, and MSME ratings and grading services. Its principal promoter and strategic partner is Canara Bank. It assigns credit ratings to municipal corporations, SMEs, capital market instruments, and bank loans. Additionally, it grades real estate investments, NGOs, medical facilities, MFIs, etc. It offers a variety of rating systems based on various financial instruments.

India Ratings and Research Pvt. Ltd.

Earlier known as Fitch Ratings India Pvt. Ltd., assigns credit scores to business issuers, financial institutions, managed funds, project finance firms, structured finance firms, and urban local governments. With Mumbai serving as its corporate headquarters, it also maintains branch offices in Ahmedabad, Chennai, Delhi, Hyderabad, Bengaluru, Pune, and Kolkata.

Infomerics Valuation and Rating Pvt. Ltd.

Infometrics Valuation and Rating Pvt Ltd is a credit rating company that has received RBI accreditation and SEBI registration. It was founded by former financial experts, bankers, and employees of administrative services. It provides a fair evaluation of the creditworthiness of banks, non-bank financial institutions (NBFIs), small and medium-sized businesses (SMUs), and large corporations. Any information asymmetry between lenders and investors is to be lessened. Since transparency is a core value, it makes an effort to give all of its clients accurate, thorough reports and credit ratings.