Forty-six per cent of the UK public have never checked their credit report, a figure which rises to 65% among 18 to 24-year-olds, new findings from Experian have revealed.

The credit reference agency also found that 69% don’t know their credit score.

Experian’s findings, based on a poll of 2,056 people, have been released for Credit Awareness Week (CAW), an industry initiative in its fifth year which is aiming to improve understanding about how credit reporting works.

The research suggested that awareness is heading in a positive direction. When the survey was first conducted in 2017, 55% had never checked their report while 78% did not know their score, and credit experts have attributed the latest increase in awareness to people taking greater interest in their personal finances as a result of the COVID-19 pandemic.

However, Experian also warned there is “still much to be done” after highlighting common myths about the credit industry. The research found that 75% – down from 80% in 2017 – believe being put on a ‘credit blacklist’ will impact their ability to access affordable finance, despite there being no such thing.

Many people still wrongly believe credit reference agencies make decisions about whether a credit application will be accepted, when it is the lender who decides. Experian found that almost a third (30%) incorrectly believe credit reference agencies decide the outcome of credit card applications, while 21% make the same incorrect assumption for loans.

Experian head of consumer affairs, James Jones, commented: “Our annual CAW survey gives us the opportunity to test public understanding of these important issues. This year’s findings, in the context of the COVID-19 pandemic, provide much food for thought.

“We’ve made positive strides compared to previous years, with recent progress a likely outcome of COVID-19 encouraging more people to pay greater attention to their personal finances. However, the clear message from the findings is that there is much more to do.

“As an industry, it’s important we empower people with the knowledge to take control of their finances and understand how they can make their credit information work for them.”

The research suggested that awareness about credit eligibility services still remains low. Eligibility can help people find the most appropriate product for their circumstances by showing them which cards, mortgages, and loans they are likely to be accepted for without damaging their score.

However, Experian’s findings indicated 47% have never checked their eligibility, meaning they could potentially be putting their credit score at risk by often applying for products they are unlikely to qualify for.

Awareness was particularly low among the younger generation, with just 7% of 25 to 34-year-olds having ever checked their eligibility, compared with 15% in the over-55s age group.
 
“Particularly during these challenging times, understanding and monitoring your credit report and score is a key element of financial management and helps you to access the best products available,” Jones added.

“Experian, through the CAW campaign, ongoing educational work, and work with the financial services industry is committed to improving public awareness and understanding of the credit system.”

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