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Do you know your credit score? 3 in 4 Australians don’t, research finds

Around 73 per cent of Australians – or 14.6 million people – aren’t aware of their credit score.

Almost half (48 per cent) have never checked their score, seven per cent are too scared to check, and six per cent don’t know what a credit score is.

With personal information concerns at an all-time high since the Optus data breach, Australians have been urged to note signs like an unexpected drop in credit score or declined credit applications, which could indicate compromised personal data. However, research by Finder found nearly 3 in 4 Australians don’t even know their credit score.

“It isn’t just a number – your credit score is a measure of how well you’re managing your finances,” explained Amy Bradney-George, personal finance expert at Finder.

“Whether you are buying your first home, applying for a credit card, or taking out a loan for a car, your credit score can help you understand how banks see you – and your chance of getting the loan.”

A credit score, sometimes called credit rating, is based on your borrowing and repayment history. It is calculated by looking into factors like past and present debt, loans and loan enquiries, current credit and store cards, and opened and/ or closed bank accounts.

This score can also be used it as a tool to help keep you safe from identity theft.

Ms Bradney-George added, “Keep an eagle eye on the transactions on your bank statement and credit card – the sooner you spot any suspicious activity the quicker you can put a stop to it. Start by contacting your bank or lender.” 

Where can you check your credit score?

According to the Office of the Australian Information Commissioner, a credit reporting body must provide access every three months to your consumer credit report, free of cost.

You can also request a free copy if your credit-related personal information has changed or if you’ve been refused credit within the past 90 days.

It notes credit reporting bodies like Equifax, Experian, and illion as viable options.

Can you improve your credit score?

In the event that your credit score isn’t where you’d like it to be, there are a few steps that can be taken.

First, ensure your credit file has your most current and accurate personal information. If there is an error, you’ll need to contact your credit provider, credit reporting agency, and in some cases, the office of the Privacy Commissioner.

Second, it’s important to demonstrate reliability in paying all bills apart from credit cards, even general bills like electricity and water, or internet and mobile.

Third, having and operating a credit card with on-time payments could actually support your credit score over having no debt at all, as it displays an ability to manage debt.

Next, managing several debts like a credit card, mortgage, or a car loan, could improve your credit score by displaying you are a ‘good risk.’

In some cases, stability in terms of employment and address shows lenders that you have staying power and are in this the long-term. With that in mind, frequently moving houses every few months or hopping between jobs could potentially hurt credit scores.

This article does not constitute legal or financial advice. For questions and inquiries, we strongly recommend you seek advice from your lawyer or financial services provider.

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ALSO READ: The product most complained about in 2021-22? Credit cards.

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Rhea Laxmi Nath

Rhea Laxmi Nath

Rhea L Nath is a Sydney-based writer and editor. In 2022, she was named Young Journalist of the Year at the NSW Premier's Multicultural Communications Awards.

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