A Study on the Role of Credit Rating Agencies in India

Abstract

Credit rating agencies play an important role in India's financial system by assessing the creditworthiness of companies, financial institutions, debt instruments, and government securities. Their ratings help investors evaluate risk, support informed investment decisions, reduce information asymmetry, and improve capital-market transparency. This study examines the role, significance, performance, regulatory environment, and challenges of credit rating agencies in India. It also evaluates their influence on investment decisions, corporate borrowing costs, capital-market development, financial stability, and risk management. Primary and secondary data were considered, with questionnaire responses from 100 respondents analyzed using percentage analysis. The study highlights regulatory oversight and technological improvements.   Keywords: Credit Rating, Investment Decisions, Financial Risk, SEBI, Capital Markets