Research from HSBC, which surveyed around 2,000 people, found that 26% of adults are confused about how their score is calculated and 22% don’t know what makes a good score.
Credit scores are an important tool used by lenders to decide whether or not to accept applications for credit cards, loans or mortgages. They are calculated using a points system based on what is in a customer’s credit report, with each credit ratings agency using slightly different systems.
| Credit ratings agency | Excellent | Good | Fair |
| Experian | 961-999 | 881-960 | 721-880 |
| Equifax | 811-1,000 | 531-670 (Good)
671-810 (Very good) |
439-530 |
| TransUnion | 628-710 | 604-627 | 566-603 |
Source: HSBC
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The report noted that the lack of awareness of credit scores is impacting “financial proactivity”, as 43% of those surveyed have taken no steps in the past year to improve or maintain their score.
There is more anxiety around credit scores among millennials, with 60% concerned about their credit score, while 63% of those aged 55 and over have taken no action to manage their score in the past year.
A key thing that people can do to improve their credit score is to get on the electoral roll, as lenders use this to verify their name and address.
Other advice includes building credit history, even with a low-limit credit card or arranged overdraft, which can “build a stronger record” – but it is important to pay on time and stay within limits, as missed payments can hurt credit scores.
HSBC said multiple applications can “suggest financial strain”, so customers should use a “quotation search” to compare rates without impacting their credit score.
Carl Watchorn, head of customer propositions at HSBC UK, said: “This research highlights a crucial disconnect between financial wellbeing and practical understanding, especially among younger generations.
“This isn’t just about a number on a screen; it’s about the real-world impact on your wallet. A good credit score is the key that unlocks better rates on loans, credit cards, and mortgages, which can save you thousands over a lifetime. The widespread confusion and inaction means many are missing out on these significant savings without even realising it.”
He added: “Building a healthy credit score doesn’t have to be complicated. Simple, consistent habits can make a huge difference. At HSBC UK, we are committed to demystifying finance and providing our customers with the tools and knowledge they need to feel confident about their financial future.”
