What Is The Average Credit Score UK

April 2024

What Is The Average Credit Score UK In April 2024

 

This article will examine the average credit score in the United Kingdom. We will discuss the factors that influence the nation’s credit scores, how to improve them, and the various credit scoring systems used in the United Kingdom. 

Our analysis will provide valuable insight into the credit scores of the nation and their implications for individuals seeking loans, credit cards, and other financial products.

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What is a Credit Score?

A credit score is a numeric representation of a person’s creditworthiness, as determined by their credit history. 

Credit reference agencies calculate credit scores using information from your credit report, which details your financial history, credit applications, and any outstanding debts. 

Lenders typically use credit scores to assess the risk of lending money to a potential borrower.

What is the Average Credit Score in the UK?

According to our research, the average credit score in the United Kingdom varies by credit reference agency. 

The average Experian credit score is 759, the average TransUnion credit score is 611, and the average Equifax credit score ranges from 380 to 419. 

It is essential to remember that these averages can vary by age group and location.

Factors that Impact Credit Scores

Several variables affect a person’s credit score, including:

  • Payment History
  • Length of Credit History
  • Types of Credit Used
  • Amounts Owed
  • New Credit Applications
  • Financial Habits and Behaviour

Payment History

Your payment history is a significant factor in determining your credit score. A poor credit history, including missed or late payments, can hurt your credit score. 

Lenders favour borrowers who consistently pay their debts on time, which indicates a lower default risk.

Length of Credit History

The length of your credit history is an additional factor to consider. A more extended credit history demonstrating responsible borrowing can result in a higher credit score. 

In contrast, a short credit history may result in a lower credit score, as lenders have less information to determine your creditworthiness.

Types of Credit Used

The types of credit you’ve utilised also affect your credit score. Using a variety of credit types, such as loans, credit cards, and auto financing, can positively affect your credit score, as it demonstrates your ability to manage different types of credit responsibly.

Amounts Owed

The balances on your existing credit accounts account for a substantial portion of your credit score. High debt levels can result in a lower credit score, indicating a greater likelihood of default. 

On the other hand, maintaining low balances on credit accounts can result in an improved credit score.

New Credit Applications

Multiple new credit account applications in a short period can negatively impact your credit score, as it may indicate financial distress or a higher risk of overextension.

Financial Habits and Behaviour

Your financial habits and conduct, such as maintaining a positive credit history, avoiding excessive debt, and managing credit responsibly, can positively affect your credit score.

How to Improve Your Credit Score?

Improving your credit score is essential to qualify for lower interest rates on loans and credit cards. Among the strategies for improving your credit rating are:

  • Make All Payments on Time Every Month
  • Pay down existing account balances
  • Decrease Your Total Debt
  • Do not simultaneously apply for too many new accounts.

The Different Types of UK Credit Scoring Systems

In the United Kingdom, there are three significant credit rating and reference agencies, each with its scoring system:

  • The Credit Score System of Experian
  • CreditVision Risk Score System by TransUnion
  • Equifax’s VantageScore System

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Average Credit Score UK

Understanding the Meaning Behind Different Scores

Credit scores are typically organised into bands, with each band’s fair credit score representing a distinct creditworthiness level. The credit score bands in the United Kingdom are as follows:

  • Very Poor (0 – 560)
  • Poor (561 – 720) (561 – 720)
  • Fair (721 – 880) (721 – 880)
  • Good (881 – 960) (881 – 960)
  • Excellent (961 – 999) (961 – 999)

Other Important Considerations When Checking Your Credit Score

When evaluating your credit score, it is essential to consider several additional variables that may affect your creditworthiness. These elements include:

Electoral Roll

Voter registration can positively affect your credit score by verifying your identity and address, reducing the risk of fraudulent activity.

Credit Check

Checking your credit report frequently for errors or indications of identity theft can help you maintain a good credit score

Notify the credit reference agency of any mistakes or inconsistencies in your credit file.

Good Credit History

Maintaining a positive credit history with on-time payments and low account balances can result in a higher credit score.

Interest Rates

Your credit score can affect the interest rates lenders offer you. Higher credit scores generally result in lower interest rates, whereas lower scores may result in higher interest rates or application denial.

Financial History

A detailed and favourable financial history can contribute to an improved credit score. Creditors may consider employment history, income stability, and past economic behaviour when evaluating credit applications.

In our experience, the average credit score in the United Kingdom can fluctuate based on age, location, and the credit reference agency utilised. Our analysis indicates that maintaining a positive credit history, managing debt responsibly, and regularly reviewing your credit report can positively affect your credit score.

In addition, understanding the various credit score systems utilised by the three major credit reference agencies (Experian, TransUnion, and Equifax) can provide invaluable insight into your creditworthiness. You can increase your chances of obtaining favourable interest rates on loans, credit cards, and other financial products by working to improve your credit score.

The average credit score in the United Kingdom is an essential indicator of a person’s creditworthiness. By actively monitoring and enhancing your credit score, you can improve your financial prospects and access more excellent economic opportunities.

What is a decent credit score in the UK?

A good credit score can significantly improve your chances of qualifying for favourable interest rates on loans, credit cards, mortgages, and auto financing. A good credit score in the United Kingdom typically falls between “good” and “excellent.” 

Our analysis of the three credit rating agencies (Experian, TransUnion, and Equifax) indicates that a good credit score ranges from 881 to 960, whereas an excellent credit score ranges from 961 to 999.

Is 500 a good credit score UK?

In the United Kingdom, a credit score of 500 is not considered good, as it falls within the “poor” range of 561 to 720. 

Individuals with a low credit score may encounter obstacles when applying for loans, credit cards, and other financial products, as lenders view them as higher-risk borrowers. 

Improving your credit score through responsible financial management and addressing any negative factors on your credit report can increase your chances of obtaining more favourable loan or credit card terms.

What is the most common credit score in the UK?

The most common credit score in the United Kingdom varies depending on the credit reference agency used, but the average score falls between “fair” and “good.” 

Our findings indicate that credit scores can vary significantly based on age, location, and financial history, among other variables. Therefore, no single universal credit score can be considered the most prevalent among all credit scores in the country.

Factors that Impact Credit Score

Does everyone have a credit score UK?

Every adult in the United Kingdom with a credit history has a credit score. If a person has never used credit or has a limited credit history, they may not have a credit score. 

Credit reference and credit rating agencies can generate credit scores based on information in an individual’s credit report.

What raises credit scores?

There are several ways to improve your credit score in the UK, including:

  • Making prompt payments on all obligations and expenses
  • Maintaining low credit card balances and decreasing overall debt
  • Avoid applying for multiple new accounts within a short time frame.
  • Registering on the voter list to verify your identity and address.
  • Regularly examine your credit report for errors and resolve disputes with the three major credit bureaus.

How can I build my credit score UK?

Consider the following steps to increase your credit score in the UK:

  • Establish a credit history by applying for a credit product, such as a loan or credit card.
  • To maintain a good payment record, make all payments on time and in full.
  • Maintain a low credit utilisation ratio by keeping existing credit account balances low.
  • Limit credit applications and avoid opening many new accounts in a short period.
  • Regularly review your credit report and dispute any inaccuracies with the three credit reference agencies.
  • You can build and maintain a strong credit score in the UK by adopting responsible financial practices and closely monitoring your credit report. This can improve your access to financial products and help you obtain better interest rates on applications for loans, credit cards, and mortgages.

How do regional differences affect the average UK credit score?

Regional differences can affect the average credit score in the United Kingdom, as factors such as the local economy, employment rates, and the financial habits of residents can vary. 

For instance, regions with higher unemployment rates or lower average income levels may have lower average credit scores due to residents’ increased financial hardships.

Kingston upon Hull’s credit score may differ from the national Experian average credit score, depending on the above variables and the residents’ financial habits.

Do the main credit reference agencies in the UK have different credit score bands?

Although the three major credit reference agencies in the United Kingdom, Experian, Equifax, and TransUnion, each have their scoring systems, the credit score bands are generally comparable. Each band represents a different level of creditworthiness. 

The same numerical ranges within each band may vary slightly across the three credit rating agencies, but the overall classification of credit scores remains consistent.

How does a bad credit score impact mortgage applications and interest rates in the UK?

A poor credit score or credit history can significantly impact a mortgage application, and the interest rate offered in the United Kingdom. Lenders view borrowers with poor credit as riskier, which may result in a higher interest rate or denial of a mortgage application. 

Enhancing your credit score can increase your chances of securing a mortgage and negotiating a lower interest rate.

How does available credit affect one’s credit score in the UK?

In the United Kingdom, available credit, which refers to the unused portion of your credit limit, can affect your credit score. Lenders frequently consider the credit utilisation ratio, the proportion of available credit utilised. 

A lower credit utilisation ratio (using a smaller percentage of your available credit) is generally viewed favourably and can result in a higher credit score. In contrast, a high credit utilisation ratio (using a significant portion of your available credit) can hurt your credit score.

How do car finance applications affect the average UK credit score?

An individual’s average credit score in the United Kingdom may be affected by their application for auto financing, as lenders typically review credit histories to determine creditworthiness. 

When applying for auto financing, the lender will request a credit report from one or more major credit reference agencies (Experian, Equifax, and average TransUnion credit score). 

These organisations offer credit scores based on their respective systems, including Experian, Equifax, and TransUnion scores. Multiple applications for auto financing in a short period can lower your credit score, as it may signal financial distress or an increased risk of overextension.

How can one improve a bad credit score or repair a bad credit record in the UK?

Consider the following steps to improve a poor credit score or repair a poor credit history in the United Kingdom:

  • Pay your debts, loans, and bills promptly to demonstrate a consistent payment history.
  • Reduce your overall debt levels and keep your credit account balances low.
  • Avoid applying for multiple loans, credit cards, and other forms of credit in quick succession.
  • Registering on the electoral roll improves your credit score by verifying your identity and address.
  • Examine your credit reports from the three major credit reference agencies (Experian, Equifax, and TransUnion) frequently and dispute any errors or inconsistencies.
  • By following these steps, you can gradually improve your credit score and repair a poor credit history, making it easier for creditors to lend you money and providing better interest rates on loans and other financial products.

What are the UK’s highest and lowest average credit scores among different age groups?

The highest average score and lowest average credit scores in the United Kingdom can vary depending on age group. Younger age groups may have lower average credit scores due to shorter credit histories and less experience managing credit. 

Because they have had more time to establish a long credit history and demonstrate responsible credit management, older age groups tend to have higher average credit scores. Other factors, such as financial habits, employment, and income stability, can also impact credit scores across age groups.

Is one universal credit score that applies to all individuals in the UK?

No universal credit score applies to all individuals in the United Kingdom. Each central credit reference agency (Experian, Equifax, and TransUnion) has its scoring system and scale, so that credit scores can vary depending on the credit reference agency used. 

While these agencies’ credit score bands are comparable, the specific numerical ranges within each average Experian credit score band may vary. To better assess your creditworthiness in the eyes of lenders, it is crucial to comprehend the various credit score systems employed by these agencies and how your credit score is calculated.

Want to know what information is held about you on your credit report?

Checkmyfile can show you, in one report, data from the leading 3 agencies in the UK

Get an independent view with your checkmyfile Credit Score
Data from all four Credit Reference Agencies: Equifax, Experian and TransUnion.
Try free for 30 days. Really easy to cancel – by Freephone or even online
Ensure your payments are correctly recorded
Understand what’s affecting your score

Read some recent 5 star client testimonials, on Trustpilot, about Checkmyfile’s comprehensive credit report

Try free for 30 days and get the information that you need, then £14.99 per month. However, you can cancel online at any time. If you sign up, we will receive a small payment for introducing you.  This helps us produce more content for the site.

 

Meet the author

Rob Atherton

Rob Atherton

Rob writes and edits the content produced by the rest of the team. He has a degree in History from Leeds University and has producing, reviewing and editing the site since 2016

Meet The Team

Frequently Asked Questions

How do the average credit scores in the UK differ between the three central credit reference agencies, Experian, Equifax, and TransUnion?

Due to their distinct scoring systems and scales, the average credit scores of the three leading credit reference agencies in the United Kingdom differ. Experian’s average credit score, on a scale ranging from 0 to 999, is 759. 

The average Equifax credit score ranges from 380 to 419 on a scale from 0 to 700. The average credit score at TransUnion is 611 on a scale ranging from 0 to 710. When reviewing your credit score, it is important to be aware of these differences, as lenders may use different credit reference agencies to determine your creditworthiness.

How can a bad credit score impact my ability to secure loans, credit cards, and other financial products in the UK?

A poor credit score can hinder your ability to obtain loans, credit cards, and other financial products in the United Kingdom, as lenders view individuals with low credit scores as higher-risk borrowers. This could result in less favourable interest rates, higher fees, or even a complete denial of your application. 

By improving your credit score through responsible financial management, you can increase your chances of obtaining better terms on loans, credit cards, and other financial products.

Which factors contribute to the variation in average credit scores across different regions in the UK?

Several factors, such as income levels, employment rates, access to financial products, and financial literacy, contribute to the variation in average credit scores between regions in the United Kingdom. 

For instance, regions with higher average incomes and lower unemployment rates may have improved access to financial products and services, resulting in higher average credit scores. Moreover, regional differences in financial literacy and access to credit education resources can also contribute to credit score variations.

How does the electoral roll influence my credit score, and what steps can I take to ensure my details are current?

Being on the electoral roll can positively affect your credit score because it helps verify your identity and address, reducing the risk of fraud. In assessing your creditworthiness, lenders frequently use this information to verify your identity. 

On the UK government’s website, you can register to vote or update your existing voter registration information to ensure that your data is accurate. If you have recently relocated, update your address on the electoral roll, as doing so can boost your credit score and demonstrate your stability to lenders.

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