How does credit utilisation affect me?

Utilisation is your use of credit compared to your available credit limits. If your credit card limit is £500 and you’ve used £50, your utilisation is 10%. You can see your current balance, headroom, and credit limit on your Checkmyfile report. These are what are used to work out your credit utilisation.

If your credit utilisation is high, it means you’re quite close to your limits, and lenders may be reluctant to lend you more money. They don’t want you to take on too much debt, just in case it becomes unmanageable.

On the other hand, if you have no credit activity at all, it’s hard for lenders to see that you can use credit and make payments on time.

Utilisation of around 30% is beneficial for your score - this shows lenders that you can use credit but not rely on it. Lenders will often review and adjust credit limits depending on your credit utilisation.

Credit utilisation can be used to build a positive credit history and grow your score by showing lenders that you can use credit responsibly.