Average Credit Score In The UK

Average Credit Score In The UK

This page was last updated on 1 September 2021

Average Credit Score In The UK In 2021

Credit scores can be challenging to get your head round. 

Not only are they quite complex financial instruments, their relationship to debt has been frequently, unhelpfully covered in the mainstream media.  

This article will take you through what you actually need to know about credit scores, and answer any questions you may have about what the average credit score in the UK is.

Topics that you will find covered on this page

You can listen to an audio recording of this page below.

 

What is a credit score?

A credit score is measures of how likely you are to pay back money lent to you, also known as your ‘creditworthiness’ (i.e. if you are ‘worthy’ of credit). 

They were developed in 1950s America to regulate and standardise the available credit offered to people.  

How are credit scores calculated?

They are calculated from your ‘credit report’, which documents your financial history — specifically, all your dealings with credit. 

If you have a good credit history (e.g. your credit report shows you have always repaid creditors on time) then you will receive a high credit score. 

Alternatively, if you have a poor credit history (e.g. your credit report shows that you have regularly missed payments) your score will be low.  

Does everyone have a credit score?

No, because your credit history begins when a creditor, such as a credit card issuer, reports that you have opened an account — thereby starting your ‘credit report’. 

If you have never registered to open any such account, you will have no credit history and therefore no credit score. 

Credit score vs credit rating

Despite sometimes being used to mean the same thing, there are important differences. 

They both rate ‘creditworthiness’, but:

  • A credit rating is used for large organisations like businesses and governments, and is expressed using letters. 
  • Credit scores are used for individuals and are expressed as a number.

Do I just have one credit score?

Surprisingly, no. There is no universal credit score.

You will actually have three credit scores, because there are three ‘Credit Reference Agencies’ (CRAs) in the UK and they all use their own measurements to determine a score for you.

The 3 CRAs are:

They are all authorised and regulated by the Financial Conduct Authority, and are the only organisations that can perform a credit check on you – any others will be scams!

How are credit scores ranked?

While each Credit Reference Agency uses a different numerical scale to determine your credit score, they all have five categories that they sort individuals into. 

These are:

  • Excellent
  • Good
  • Fair
  • Poor
  • Very poor.

You will probably be put into the same category by all three agencies, as they all base their rating on your one credit record. So, if you receive a ‘good’ Experian credit score, it’s likely the other two agencies will give you a rating of ‘good’ too. 

Average Credit Score

How does Equifax grade credit scores?

Equifax arranges their ranking by scoring out of 700. 

This is how Equifax rates credit scores:

  • 0 – 279 Very Poor
  • 280 – 379 Poor
  • 380 – 419 Fair
  • 420 – 465 Good
  • 466 – 700 Excellent

"A credit score is measures of how likely you are to pay back money lent to you, also known as your ‘creditworthiness’ (i.e. if you are ‘worthy’ of credit). "

What is the Equifax average credit score?

ClearScore estimates that the average Equifax credit score is 380. As per the above ranking system, this is classified as ‘fair’. 

How does Experian grade credit scores?

Experian arranges their ranking by scoring out of 999.

They rate their scores as follows:

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

What is the Experian average credit score?

Experian’s average score is 759. As you can see from the above grading system, this falls into the ‘fair’ category. 

Experian also helpfully offers this interac  tive map on their website, which shows average credit scores by location. This can help you understand the average credit score in your area and how you compare to your peers. 

According to Experian’s map, the title for worst average credit score in the UK goes to Kingston-upon-Hull, East Yorkshire, at 661, and the highest goes to the Isles of Scilly at 848. 

How does TransUnion grade credit scores?

TransUnion arranges their ranking by scoring out of 710. 

This is how they rank them:

  • 0- 550 Very Poor
  • 551 – 565 Poor
  • 566 – 603 Fair
  • 604 – 627 Good
  • 628 – 710 Excellent

What is the TransUnion average credit score?

Unfortunately, TransUnion does not release data about average credit scores.

However they have released some broad data on regional differences. The highest regional credit score was calculated to be from Kingston-upon-Thames, London (547), with the worst credit scores found in Cleveland, Yorkshire, with an average of 513.

What is the overall average credit score in the UK?

Because the three ‘scores’ all use a different scale they aren’t directly comparable, and so we can’t pinpoint what the average numerical score is across the UK. 

However, we can say that average credit scores typically falls in the ‘fair’ range across all three credit rating agencies.

Is an average credit score enough?

Firstly, be mindful that there is no ‘magic’ score that will guarantee you getting accepted for credit. Each lender has their own varying criteria, and so you might get refused credit by some lenders yet accepted by others. 

However, generally speaking you should try to maximise your credit score. Doing so can help you be more readily accepted for credit and get the best rates. 

Why is an above average credit score important?

Having an above average (or ‘good’) credit score is important for two reasons. 

Firstly, because banks and lenders are less likely to lend money to people who they think will not repay them. Lenders aren’t obliged to lend to anyone, so borrowing money can become more difficult if your score is too low.  

This means you can lose access to things such as:

  • New credit cards
  • Mortgages
  • Personal loans 
  • Mobile phone contracts

And even if you are approved, you may not be offered as substantial a loan as compared to someone with a score considered ‘excellent’ or ‘good’. 

Secondly, a good credit score is important because it will entitle you to the best rates and most generous credit limits. Often, as your credit score increases, the lower the interest rates offered to you become. 

This is especially important for large loans (for example mortgages) which you will likely pay back over many years. 

What can lower my credit score?

There are a variety of things to can have an adverse affect on your credit score, for example: 

  • Frequent late or missed payments (e.g. credit card repayments)
  • Past bankruptcies
  • Past insolvencies
  • Holding, or having held, a joint account with someone with a bad credit record
  • Regularly withdrawing cash from your credit cards
  • Not being registered on the electoral roll 

There also are a host of other factors at play, such as your address history and if your credit history is too short. This is because lenders want you to have a proven track record of dealing sensibly with credit. 

Is it important to know my credit score?

Yes! Knowing your score is important because you can then start working to improve it, if that’s necessary. 

Also, you’ll be able to see if there are any mistakes in your credit file, which you can ask to be removed. 

It’s important to check your credit score in good time so that any mistakes are removed before lenders start to investigate your financial history.  

average credit

Can I check my credit score?

Yep. You can check your credit score from all three agencies for free online.

Find out how to check each different credit score here.

How can I improve my average credit score?

You can do lots of things in a short period of time to boost your score. 

One of the most simple things you can do is get registered to vote – Experian has said that this will increase your credit score by a whopping 50 points! 

Another simple thing you can do is stay on top of your credit cards’ bills, or, if you’ve never had one before, get a credit card and pay it off each month to show your consistent reliability. 

How can the “30% rule” help me?

The ‘30% rule’ is a simple piece of good practice that can benefit your credit rating. 

The firm ClearScore has argued that, to keep a good credit score, you should use no more than 30% of your credit limit.

Keeping within this level ensures you only have a moderate, manageable amount of debt at any one time. Applying this practice to a loan or credit card is an excellent way to show lenders you can manage your credit sensibly. 

Will my credit score increase immediately?

No, it can take time for any updated information to come through and for you to be given a higher credit score. As such it pays to start as soon as possible, as you’ll get a good credit score sooner! 

Ultimately, if you take action to reduce late payments on your credit cards and get on the electoral roll, you’re taking a positive first step towards getting a good credit score.

More interesting articles related to credit ratings

what is a credit rating and how to improve it?

In this article we explain what a credit rating is and what steps you can take to improve your score.  Even small steps can have a huge impact.

does switching bank affect your credit rating?

As more people begin to see the benefits of switching bank accounts, one thing you need to think about is if it has an impact on you

what credit score is needed to rent a house?

If you are looking to rent a house then it is likely that your prospective landlord will do a credit check on you.  Read about why.

minimum credit score for a mobile phone contract

Increasingly, if you are looking at a mobile phone contract the provider will want to do a credit check.  Our article explains what is involved.

does an IVA affect your credit rating?

If you have taken an Individual Voluntary Arrangement then this will impact your credit rating.  Our article explains how.

What is an equity release calculator?

Home owners with debt issues often look at equity release as a way of releasing money. Our calculator shows what you could get.

Article author

James Lloyd

I am the primary writer and author for Help and Advice, having originally helped start the site because I recognised that there was a need for easy to read, free and comprehensive information on the web. I have been able to use my background in finance to produce a number of articles for the site, as well as develop the financial fitness assessment tool. This is a tool that provides you with practical advice on improving your personal financial health.

Outside of work I am a keen rugby player and used to play up to a semi-professional level before the years of injury finally took their toll.  Now you are more likely to see me in the clubhouse enjoying the game.

Email – james@helpandadvice.co.uk

Linked in – Connect with me

Frequently Asked Questions

What is a credit score?

A credit score is measures of how likely you are to pay back money lent to you, also known as your ‘creditworthiness’ (i.e. if you are ‘worthy’ of credit). 

They were developed in 1950s America to regulate and standardise the available credit offered to people.  

Does everyone have a credit score?

No, because your credit history begins when a creditor, such as a credit card issuer, reports that you have opened an account — thereby starting your ‘credit report’. 

If you have never registered to open any such account, you will have no credit history and therefore no credit score.

What is the overall average credit score in the UK?

Because the three ‘scores’ all use a different scale they aren’t directly comparable, and so we can’t pinpoint what the average numerical score is across the UK.

Why is an above average credit score important?

Having an above average (or ‘good’) credit score is important for two reasons. 

Firstly, because banks and lenders are less likely to lend money to people who they think will not repay them. Lenders aren’t obliged to lend to anyone, so borrowing money can become more difficult if your score is too low.

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