Credit rating agencies are companies or organizations that rank borrowers based on their ability to pay back their interests and loan amount on time and the probability of them defaulting. These agencies may also analyze the creditworthiness of debt issuers and provide credit ratings to only organizations and not to the consumers. The assessed organizations may be companies, special purpose entities, the state governments, local governmental bodies, non-profit organizations, and even countries. Individual customers are rated by specialized agencies known as credit bureaus that provide a credit score to every customer based on his/her financial history.

The Credit Rating Agencies in India do not have that deep past. They came into action in the second half of the 1980s era. Six credit rating agencies are registered under SEBI those of which are CRISIL, ICRA, CARE, SMERA, Fitch India, and Brickwork Rankings. The  Rankings are provided by these agencies to determine the nature and Basis of the credit. the higher is the credit rating, and the lower is the interest rate offered to the organization.

The following are the Various Credit Rating Agencies that are working in India Lets discuss them briefly.

 Credit Rating Information Services of India Limited (CRISIL)

The CRISIL was the first credit rating agency that was founded in India in the year,1987. In the present era, CRISIL has become a globally analytical company that rates organizations, researches, markets, and provides risk and policy advisory services to its clients. At the time when the company was incorporating, the agency was given a promotion by the  ICICI Limited, UTI, and many such financial institutions. The agency started operations in 1988.

CRISIL is a Mumbai based company. It provides an independent opinion, options, and effective solutions by performing researches and analyzing data. It has a rigid track record of having inbuild ideas that are innovative and progressive at the same time. The organization has expanded its business operations to countries like the UK, Poland, the USA, Argentina, Hong Kong, China, and Singapore apart from having its set up in India. The majority shareholders of CRISIL are Standard & Poor’s, one of the huge credit rating agencies around the world which shows us that it has held a global impact on a worldwide scale.

CRISIL works with various governmental organizations and policy-makers within India and other developing nations to increase and improve the infrastructure and fulfill the demands of the region. The firm has ranked around 5180 SMEs in India and has been issued more than 10,000 SME rankings overall. The CRISIL commands revenue of Rs 1,110 Crores with a net income of Rs 298 Crores and an operating income of Rs 320 Crores.

credit rating agencies

 Investment Information and Credit Rating Agency (ICRA)

Originally named as an Investment Information and Credit Rating Agency, the organization was founded in 1991. It was a joint proposal of Moody’s and Indian financial and banking service organizations. It was renamed to ICRA  and was entitled to the National Stock Exchange and the Bombay Stock Exchange in April 2007. ICRA is an independent professional corporate investment information and credit rating and advisory agency, which is located in Guru gram, Haryana.

The ICRA assigns corporate governance rating, performance ratings, grading, provides a ranking to mutual funds, hospitals, construction, and the real estate companies. The agency generates a  revenue of Rs 2.28 Billion. The ICRA majorly focuses on the MSME area. To cater to its clients, the dedicated team of professionals has developed a small scale for the related sector. It benefits the agency to benchmark peers quite easily. ICRA ratings are used to analyze the risk of credit in India. It does not cater to international agencies and organizations.

 The Small and Medium Enterprises Rating Agency of India (SMERA)

The Small and Medium Enterprises Rating Agency (abbreviated as SMERAI) of India is an agency that functions exclusively for the sector for which it was formed, i.e., Micro, Small, Medium and Micro Enterprises. The agency was discovered in the year 2005 by SIDBI (Small Industries Development Bank of India ), Dun and Bradstreet Information Services India Private Limited, various public, the private sector, and other Multinational Company Banks located in India.  The agency has its roots in Mumbai. SMERA has been registered with the SEBI as a credit rating agency and accredited by RBI in the year 2012. It is an external credit assessment institution (ECAI). The SMERA ranks bank credits under the Base II guidelines. Ranking of various instruments like IPO, bonds, commercial papers, NCDs, fixed deposits, security receipts, etc. is done by SMERA which can be used by all banks for capital acceptability requirements calculation as authorized by the Reserve Bank of India.

SMERA pioneered SME ranking in India, and till now it has ranked more than 38,000 industries. Many of the financial institutions highly consider SMERA rankings before approving or lending funds.


India Ratings and Research is a credit rating agency that provides time-boundness, accuracy, and promptness in credit opinions. It is 100 percent owned by the subsidiary of the Fitch Group. Ind-Ra covers financial institutions, corporate issuers, banks, insurance companies, urban local bodies, project finance, and structured finance. Fitch‘s Ind-Ra is originally rooted in Mumbai and has its branch offices in metropolitan cities like  Ahmedabad, Bengaluru, Chennai, Delhi, Hyderabad, and Kolkata. The FITCH India is a recognized company by the Securities and Exchange Board of India, National Housing Bank, and the RBI. FITCH is a considerable financial information service provider rating agency that has it operates in more than 30 countries globally. It checks the credit capacity of global leaders in the industrial sector.

Credit Analysis and Research Limited (CARE)

This agency was established in the year 1993, and since then it has evolved to become the second-largest credit rating agency in India. It was promoted by the (IDBI) Industrial Development Bank of India, Unit Trust of India Bank, Canara Bank, and many other financial institutions as well. CARE has its roots in Mumbai and regional offices located in New Delhi, Bangalore, Chennai, Hyderabad, Ahmedabad, and Kolkata. CARE’s primary function is to perform debt instruments rating, credit analysis rating, loan rating, corporate ratings related to corporate governance, claims-paying abilities of insurance companies, etc. It also ranks the construction organizations and the courses that are being carried out by the training institutes. The Ranks are provided by CARE that includes financial institutions, state governments, and municipal bodies, public utilities, and special purpose vehicles.

The Information and the Advisory Service Department of CARE prepare the credit ratings and reports on special requests that are being made from the side of business partners, banks, and other financial entities. It also conducts sector-based research and provides the necessary advisories for the financial restructuring, valuation, and credit judgment systems. The agency conducts substantial research and ranks SMEs based on their financial condition. These ratings are provided under 8 degrees where the  CARE SME 1 means outstanding financial health with negligible risks and CARE SME 8 rank signifies lowest credit quality with highest credit risk.


This Credit Rating Agency is a private rating agency was established by Sonu Mirchandani under the ONIDA Finance. It is headquartered in Gurugram, Haryana. The company provides credit ratings, conducts risk assessments, and provides analytical solutions to people, corporates, and MSMEs. The solutions that are being offered by the agency helps the organizations in making informed and sound decisions about lending funds to the borrowers, MSMEs, and other companies. After its establishment in the year 1993, the agency has gained huge expertise in assessing small, micro, and media partnerships. It is one of the seven agencies that is licensed by the NSIC (National Small Industries Corporation) for the SME’s ratings. Onicra provides services such as gradings also. The services involved in this include fields such as healthcare grading, solar energy grading, education grading, and APMC grading. Onicra has signed MoUs with almost sixteen banks and NBFCs throughout India to provide interest rate concession of up to 1 percent to the top MSME units. It performs an extensive range of tasks including work related to finance, analytics, accounting, customer relations, and managing the back-end work. Onicra has rated more than 2500 SMEs during the past two and a half decades.

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