Perhaps you’re aiming to improve your credit score in order to increase your credit card limit. Maybe you’re looking to buy a house or thinking about what’s involved in the process as you save up. Or maybe you’re just swotting up on finance – why not! Whatever brings you here, we’re hoping you’ll find the answers to your questions below. (And if not, drop us a message.)

Why should you care about your credit score? Think of it as your financial CV, a reflection of all the money moves you’ve made to date and an indication to lenders of how responsible you really are. 

Your credit score makes an appearance at various big and small life moments, so a good score essentially means an easier ride throughout. Whether you’re getting a new mobile phone contract, leasing a car for a few years, or looking to get a mortgage – the better your credit score, the more likely you are to be approved, and the better the deal you’re likely to get. 

At Keebo, we’re doing things differently when it comes to credit. Our bespoke points system allows you to learn from every transaction you make and, hopefully, improve your score along the way. Ultimately, we’re building a truer picture of your financial health, helping you reach whatever your end goal might be. 

So, without further ado, here’s everything you need to know about credit.

What is a credit score?

A credit score represents your creditworthiness. It’s an indicator to lenders of your usual behaviour when it comes to money – and will affect how likely they are to lend to you, how much and at what interest rate. 

Credit scores generally range from 300 (considered a “bad” credit score) to 900+ (considered a “good” credit score) – each credit reference agency measures things slightly differently. At Keebo, we have our own points system, which we’ve designed to better reflect your financial behaviour, for a credit score you can learn from. 

Cliché but true, there’s always room for improvement. Helping you to understand how to build better credit (and what’s the point of it) is what we’re here for.

How to check your credit score?

You can go directly to source and check with the three UK credit reference agencies (CRAs): Experian, Equifax and TransUnion. 

You can also check via other finance apps, high-street banks and comparison sites, which will loop back to one of the above CRAs. 

Or register for a Keebo credit card and we’ll work it out together. 

What affects your credit score?

The traditional CRAs (Experian, Equifax and TransUnion) base your score on your credit history: be that credit cards, loans, overdrafts, bills or rent, and how you’ve approached paying them off. Late payments, only paying the minimum amount, and getting close to your limit can all have a negative impact on your credit score. While the opposite – paying on time, in full, and using a lower percentage of the credit available to you – has a positive impact.

They might also use ONS (Office of National Statistics) data – the electoral roll, your postcode – to calculate your credit score. For example, you and your friend living in the same area might have very different relationships with money, but if neither of you have much credit history, you’ll both receive the same score based on your shared postcode. 

One more thing to note: traditional CRAs are very much a closed book. Yes, they’ll run the numbers and spit out your score, but exactly how they’ve worked it out and what specifically impacts that number as it fluctuates is never shared.  

Keebo calculates your credit score differently. We think the old-school models are outdated, unhelpful and frankly a bit silly. So, alongside some standard CRA measures, we’re also using open banking to get a full picture of your finances and relationship to them. That way, we’re able to offer personalised credit based on your real life. Think higher credit limits and lower interest rates if you’re good with your money, plus a transparent and flexible credit score that you can actually learn from. Here are a few more details on how and why Keebo is different. 

Why might you have a lower credit score?

Put simply, it’ll come down to how you have managed your debts. If you have outstanding loans, have regularly failed to make repayments on time, or only been able to pay the minimum amount, this will negatively impact your credit score. 

Having no credit history, or very little, also impacts your score.

What if you don’t have any credit history? 

Traditional lenders are likely to exclude you if you have no credit history or relatively little, aka a thin credit file. This means there’s limited information on your financial record, usually four or less credit accounts.

However, thanks to the joy of open banking, Keebo considers other factors. These include your income, what you spend, what you save and everything in between (depending on which bank accounts you link up to the app).

How to improve your credit score?

The first step is really getting to know your own spending and saving habits. Every transaction you make impacts your overall financial health. With Keebo, managing these responsibly will also earn you points (making fintech fun is a challenge, but, we try). 

Repay your credit card on time? Points to you. Got a regular income? Points scored. Save some every month? More points. You get the gist. Understanding the effects of these money moves means you can better control them to your advantage, improving your credit score along the way. 

Ps. You’ll get more insights if you start using the Keebo app (not-so-subtle hint).

How to get started building credit?

The key is to get a credit limit and interest rate that you can afford. If you’re just getting started, your credit limit is likely to be on the lower side, so you’re safe in the knowledge that repayments won’t be too difficult. And from there you can start building your credit. 

With good financial behaviour over time, you can prove your creditworthiness. Since you’ll then become less of a risk in the eyes of lenders, your interest rate should lower and your credit limit should rise. 

What are the benefits of a credit card?

In a nutshell: financial freedom and flexibility. A credit card provides greater security for online payments, allows you to spend safely while travelling, increases your purchasing power and allows you to cover unexpected costs. 

Throughout, using your card wisely helps to build your credit score. And step by step, you’re closer to that future goal – whether that’s lowering your interest rate, increasing your credit limit or getting a better deal on a mortgage. 

Keebo also offers the added bonus of education. The more you know about your money, the healthier your financial outlook.

How many credit cards should you have?

This depends on your personal credit history, it’s not a one size fits all when it comes to credit cards. 

Different lenders will have their own take on how many credit cards they’re happy for you to have (for Keebo, it’s a maximum of 3), and they will also look at your financial behaviour across them. 

The same rules apply if you have one credit card or more – if you pay the full amount each month and stay towards the lower end of your limit, this should positively affect your credit score. On the flip side, if you lose track of your spending across multiple credit cards, your credit score will be negatively impacted. 

Alternatively, you could pause spending on your existing credit card and switch to one that, say, gives you a little more financial education along the way – hi, register with Keebo! 

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