What is a credit score?
A credit score is a number that reflects your credit behaviour over time. It is calculated using information from your credit history, including how consistently you repay your accounts and loans.
Lenders use your credit score when assessing credit applications.
What factors affect your credit score?
Several factors can influence your credit score.
Payment history
Paying your accounts on time helps build a positive credit record.
Outstanding debt
High levels of debt compared to your income may negatively affect your credit profile.
Length of credit history
Longer credit histories generally provide more information about repayment behaviour.
Credit applications
Applying for multiple credit accounts within a short period may lower your score.
Building a healthy credit profile
Responsible credit use over time helps build a strong credit profile.
Healthy credit habits include
- Managing credit responsibly
- Keeping debt at manageable levels
- Making regular payments on time
Strong credit habits can improve your financial flexibility in the future.
Avoid frequent credit applications
Applying for credit too often may signal financial stress to lenders.
It is usually better to apply only when necessary and when you are confident that the repayment will be affordable.
Careful borrowing decisions can help protect your credit score over time.
Review your credit report
Checking your credit report periodically can help you identify errors or outdated information that may affect your credit score.
Reviewing your record also helps you understand your current credit standing and track improvements over time.
If you notice incorrect information, it is important to raise it with the relevant credit bureau or provider.
Responsible credit reminder
Use credit with confidence
Credit can be a useful financial tool when used responsibly and when repayments remain affordable.
Understanding how credit works can help you make informed financial decisions.