Four million Brits have checked their credit score for the first time ever during the COVID-19 lockdown, research suggests.
Overall, a third (35%) of Brits have checked their credit score since the UK went into lockdown on 23 March, a survey of 2,000 people by credit reference agency TransUnion found.
People said their interest piqued as they have more time on their hands (33%), being unemployed or working from home, as well as increased concerns about their finances (27%) because of the coronavirus pandemic.
Because of this concern, two in five Brits (41%) have now set themselves a budget, a fifth (19%) have opened a savings account, and 16% have found or are looking for a cheaper insurance provider, the data shows.
While TransUnion called these “positive first steps”, it urged more people to check and monitor their credit report and score to make sure they understand how they can affect their finances.
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More than one in three (36%) UK households struggling financially due to the COVID-19 crisis have received support — including deferrals, forbearance and payment holidays — from their financial provider, it reported.
But even with this support, “it’s important to keep a track on your credit profile and think about the long-term picture”, the firm advised.
“The fact that about two thirds [of Brits] haven’t checked their credit score during lockdown suggests a lack of understanding about the role that credit information plays — not only [in] accessing everyday finance like mobile phone contracts and overdrafts, but in achieving financial goals,” said Kelli Fielding at TransUnion.
“While bigger purchases may be on hold for now, it’s essential you keep an eye on your credit report and score so you’re aware of any changes and can take the right steps to minimise any impact during the pandemic.”
TransUnion also debunked some common myths about credit scores.
Five credit score myths, debunked
There’s no such thing as a “credit blacklist” — Credit reports are factual, and finance providers have their own policies about who they extend credit to, based on more than just credit information.
Credit reference agencies don’t decide who gets credit — Only financial providers can decide who they offer credit to. Credit reference agencies just provide some of the information they use to make their decision.
Being denied credit doesn’t damage your credit score — Whether your credit application has been denied or accepted won’t show up on your credit report. But “you should avoid making multiple credit applications in a short period of time, as this can have an impact”, TransUnion said.
Past relationships do not affect your credit score — Someone else’s credit history can only affect yours if you had joint accounts or financial connections. If you had a financial association with a former partner but no longer share any financial connections, you can formally disassociate yourself so their financial behaviour cannot impact yours.
Checking your credit score won’t damage it — You can check your credit score as often as you like, with no impact.