61% of card holders ‘do not know their credit rating’

Nearly two-thirds of UK card holders do not know what their credit rating is, new research conducted by Confused.com has shown.

The study highlighted a worrying lack of knowledge among people who have committed to financial products.

While 61 per cent of the respondents said they have no idea what their credit score is, 40 per cent indicated they have never checked their rating in their life.

However, the most alarming statistic to emerge from the survey was that a staggering 27 per cent admitted they do not even understand what a credit rating is.

With this in mind, it is hardly surprising that so many people have no clue about how their actions might hinder their ability to take out credit cards and loans in the future.

Around 87 per cent of the poll were unaware that using a card to gamble online can have an impact on their credit score, while 55 per cent did not know that taking out a payday loan can also have significant consequences.

Merely applying for one of these high-interest loans can dent your credit rating, regardless of whether you receive the money or not.

In addition to this, only 17 per cent of the 2,000 card holders who took part in the survey knew that a bad credit rating can prevent them from getting a job in certain sectors.

More and more people are struggling with credit card debt in the UK, with a recent study by consumer watchdog Which? indicating that more than one in four Britons now see the use of credit as a part of their everyday life.

The findings from the Confused.com research hardly inspire confidence that the country has its debt management firmly under control.

"We hope by highlighting the importance of knowing the facts when it comes to credit ratings, it will encourage more people to give it some thought," commented Nerys Lewis, head of credit cards at the website.

"If you don't know that using your credit card for online gambling can affect your rating, for example, you could potentially be harming your score without realising it."

By Amy White