Credit rating agencies across the world including India measure the credit rating of which of the fo...........

Economic Affairs Money Supply and Monetary Policy

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Credit rating agencies across the world, including India measure the credit rating of which of the following?

1. Individuals

2. Banks

3. Companies other than banks

4. Nations

Choose the correct answer using the codes below:

1, 2 and 3 only

2, 3 and 4 only

1, 3 and 4 only

All of the above

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Explanation:

A credit rating agency (CRA) is a company that rates debtors on the basis of their ability to pay back their interests and loan amount on time and the probability of them defaulting. These agencies may also analyse the creditworthiness of debt issuers and provide credit ratings to only organisations and not individuals consumers. The assessed entities may be companies, special purpose entities, state governments, local governmental bodies, non-profit organisations and even countries. Individual customers are rated by specialised agencies known as credit bureaus that provide a credit score to every customer based on his/her financial history.