Credit ratings are an important tool for borrowers to gain access to loans and debt. Good credit ratings allow borrowers to easily borrow money from financial institutions or public debt markets. At the consumer level, banks will usually base the terms of a loan as a function of your credit rating, so the better your credit rating, the better the terms of the loan typically are. If your credit rating is poor, the bank may even reject you for a loan,

At the corporate level, it is usually in the best interest of a company to look for a credit rating agency to rate their debt. Investors often times base part of their decision to buy bonds, or even the stock, on the credit rating of the company's debt. Major credit agencies, such as Moody's or Standard and Poor's, perform this rating service for a fee. Usually, investors will look at the credit rating given by these international credit rating agencies as well as ratings given by domestic rating agencies before deciding to invest. .

Hiiii friend..... **Benefits of Credit Rating.** 1. Helps in Investment Decision : Credit rating gives an idea to the investors about the credibility of the issuer company, and the risk factor attached to a particular instrument. So the investors can decide whether to invest in such companies or not. Higher the rating, the more will be the willingness to invest in these instruments and vise-versa. 2. Benefits of Rating Reviews : The rating agency regularly reviews the rating given to a particular instrument. So, the present investors can decide whether to keep the instrument or to sell it. For e.g. if the instrument is downgraded, then the investor may decide to sell it and if the rating is maintained or upgraded, he may decide to keep the instrument until the next rating or maturity. 3. Assurance of Safety : High credit rating gives assurance to the investors about the safety of the instrument and minimum risk of bankruptcy. The companies which get a high rating for their instruments, will try to maintain healthy financial discipline. This will protect them from bankruptcy. So the investors will be safe. 4. Easy Understandability of Investment Proposal : The rating agencies gives rating symbols to the instrument, which can be easily understood by investors. This helps them to understand the investment proposal of an issuer company. For e.g. AAA (Triple A), given by CRISIL for debentures ensures highest safety, whereas debentures rated D are in default or expect to default on maturity. 5. Choice of Instruments : Credit rating enables an investor to select a particular instrument from many alternatives available. This choice depends upon the safety or risk of the instrument. 6. Saves Investor's Time and Effort : Credit ratings enable an investor to his save time and effort in analyzing the financial strength of an issuer company. This is because the investor can depend on the rating done by professional rating agency, in order to take an investment decision. He need not waste his time and effort to collect and analyse the financial information about the credit standing of the issuer company. Thanks & Regards,

**ADVANTAGES OF CREDIT RATING** Credit rating facilitates informed decision-making Credit rating helps investors by giving them information about a proper return for the risk they are taking. Credut rating saves time and ebergy and thus relieves investir from the burden of getting first hand correct informatiob about the instrumeny and the issuer. Credit rating instills a sense of disciplibe amongst companies It is helpful for intermediaries to convince the investors easily. It gives confidence to foreign institutional investors. It reduces cost of raising finance. It facilitates fair valuation Thanks

What are the benefits of credit ratings? ---------------------------------------- Credit ratings are an important tool for borrowers to gain access to loans and debt. Good credit ratings allow borrowers to easily borrow money from financial institutions or public debt markets. At the consumer level, banks will usually base the terms of a loan as a function of your credit rating, so the better your credit rating, the better the terms of the loan typically are. If your credit rating is poor, the bank may even reject you for a loan, . At the corporate level, it is usually in the best interest of a company to look for a credit rating agency to rate their debt. Investors often times base part of their decision to buy bonds, or even the stock, on the credit rating of the company's debt. Major credit agencies, such as Moody's or Standard and Poor's, perform this rating service for a fee. Usually, investors will look at the credit rating given by these international credit rating agencies as well as ratings given by domestic rating agencies before deciding to invest. . Credit ratings are also important at the country level. Many countries rely on foreign investors to purchase their debt, and these investors rely heavily on the credit ratings given by the credit rating agencies. The benefits for a country of a good credit rating include being able to access funds from outside their country, and the possession of a good rating can attract other forms of investment to a country, such as foreign direct investment. For instance, a company looking to open a factory in a particular country may first look at the country's credit rating to assess its stability before deciding to invest.