Do Utility Bills Affect Your Credit Score?

When applying for a credit card, loan, or mortgage, it’s important to understand that your chance of approval is directly influenced by your credit score.
Many factors contribute to your credit score, including your past and present financial commitments.
You may have checked your credit report with one of the three main credit reference agencies (CRAs) and noticed a utility account, such as your water supply, alongside any existing credit accounts.
Perhaps you’re now wondering

• Do utility bills affect your credit score in the UK?
• Do utility companies report to the credit reference agencies?

thimbl takes a closer look at the link between utility bills and your credit score.

What exactly is a credit score?

Your credit score is a number that’s used to show lenders how you’ve managed credit in the past. A responsible lender will want to be sure any borrowing is affordable for you and be confident that you’ll repay any credit you’re approved for.
Typically, the better your score, the better your chance of being considered for credit, and, if approved, you could also be offered a more competitive interest rate.

What counts as a utility bill?

Some examples of utility bills include:

• Electricity
• Gas
• Water
• Broadband
• Landline/home telephone

Do utility bills affect your credit score?

In some circumstances, how you manage your utility bills could influence your credit score.
Unfortunately, because utility bills are not considered a type of credit, paying them on time each month will not have a positive effect on your credit score.
However, missed utility payments could cause your credit score to decline.

Do utility providers report to the credit reference agencies?

Utility companies may report negative activity, such as a late or missed payment, to the CRAs. Positive activity, on the other hand, is typically not reported.

A late or missed payment may not instantly affect your credit score. You may be given time to rectify the issue before the defaulted payment is reported. We’ve outlined how the process could look below, although please be aware that every provider is different.

What to expect if you default on a utility repayment

1. Your provider sends you a reminder, which could be a letter, text, or a message in their app.
2. You’ll be encouraged to reach out and contact your provider if you’re experiencing difficulties in making your payments. It’s a good idea to let your utility provider know if you’re struggling; there may be things they can suggest to help, such as a revised payment plan.
3. What happens if I don’t pay my utility bills? If you don’t make your payments, despite being sent reminders, in certain circumstances, your utility provider could disconnect your service. Please note that legally, your water cannot be cut off.
4. Your debt could then be passed to a collection agency, which will be shown on your credit report.
5. If you do not pay the collection agency, you could receive a court order or a county court judgement (CCJ). A CCJ will be visible on your credit file for six years from the date it was issued.
   Having a CCJ on your credit file will damage your credit score and negatively affect your chances of being considered for credit in the future.

How long do unpaid utility bills stay on your credit file?

An unpaid utility bill could remain on your credit report for up to 6 years.
If you make an application for credit, the provider will look at your credit report. Any defaulted repayments from the last 6 years will be visible.

Will paying a utility bill late affect my credit score?

It could do.
If you’re struggling to keep on top of your utility bills, it’s important to reach out and ask for help. Let your provider know that you’re having difficulties as soon as you can; some companies offer hardship funds or additional support for people on a low income.
Remember, money worries are common and absolutely nothing to be ashamed of. Please don’t suffer in silence.

Want to speak confidentially to an impartial ear? You can access free financial advice through StepChange, MoneyHelper, Citizens Advice, and National Debtline.

How can I build my credit score?

Whether you have no credit history or a bad credit score, it’s important to remember that you can begin your journey towards a healthier credit position today.
Below, we’ve provided several ways to work on improving your credit score. Some are easily implemented, while others will require longer-term commitment. Building credit takes time, but it’s worth it.

• Make sure that you’re registered to vote at your current address. You don’t even need to vote if you don’t want to, but simply being on the electoral register provides potential lenders with a convenient way to verify your information, and this could, in turn, boost your credit score.


• Pay your bills on time each month. As discussed, making sure that you keep on top of your utility and other bill payments is crucial when it comes to your credit score.


• Check your credit report. Ensure all your details are correct and up to date, and if you spot anything inaccurate, report it to the credit reference agency.


• Research credit builder credit cards, such as the thimbl Credit Builder Credit Card. This type of credit card could help you on your credit-building journey.

The thimbl Credit Builder Credit Card: how does it work?

1. Use your thimbl credit card to make an essential and affordable purchase, such as your lunchtime meal deal, or petrol for the car.


2. Make at least the minimum repayment amount due on your credit card balance each month. If you can afford to, you should try to make more than the minimum repayment amount. If your balance is cleared in full each month, you won’t be charged interest.


3. Your repayment activity will be reported to the CRAs. Consistent positive repayment habits soon build up, and over time, you could notice an improvement in your credit score.

Top tip: a credit builder credit card could be most effective when used in addition to other credit-building methods, such as registering to vote and paying your utility bills on time.

The thimbl Credit Builder Credit Card eligibility

You’re welcome to check your eligibility for a thimbl credit card if you:

• Are between the ages of 18 and 70;
• Are a UK resident with at least 1 year's UK address history;
• Have a monthly net income of at least £800;
• Have an active credit account that has been open for a minimum of 12 months; and
• Do not already hold a Zable credit card.

Lendable Ltd is unable to consider applications from anyone who has declared bankruptcy or is in an Individual Voluntary Arrangement (IVA).*

Find out if you’ll be accepted before you apply for your thimbl. Credit Card

• For all credit levels, from poor to excellent
• Checking won’t affect your credit rating
• 48.9% APR Representative (variable)

Check my eligibility

*The thimbl credit card is powered by Zable, a trading style of Lendable Ltd. If you choose to make a full application, a creditworthiness assessment will be carried out by Zable. This will consist of a hard search and a further check powered by Open Banking. A hard search will remain on your credit file for up to 12 months, and multiple hard searches within a short period of time could have a negative impact on your credit score. Any credit obtained upon successful application will be provided by Lendable Ltd.