Abstract: Credit Rating Comprises of 2 words – Credit and Rating. Credit means Trust in person’s ability and intention to pay or reputation of solvency and honesty. Rating means estimating worth or value of or to assign value to classifying a person’s position with reference to a particular subject matter.In the present paper we tried to know about the credit rating procedure of Credit Rating Agencies and their role in the economic system. Different studies on the procedure of credit rating agencies have been critically analyzed. We found that most of the researchers have given their stress on the transparency of the rating process and its publication. They have also critically analyzed that the fees charged by the agencies should also be revised from time to time to meet their expenditure and thus, offering unbiased and effective services to the users. For the rating purpose, the agencies should rely on statistical methods too in order to make their rating services more effective and efficient.