Research by credit reference agency TransUnion has found that seven in 10 (70%) young people aged 18 to 24 (Generation Z) check their credit score at least once a month.
The research also revealed that 57% don’t realise that late or missed payments can have a negative impact on their credit score whilst nearly two thirds (64%) were unaware that making lots of applications for finance over a short time period could weaken their credit score.
Less than a third (32%) are aware that using a high proportion of available credit can negatively affect their credit score with the majority (71%) not realising that being on the electoral register helps to strengthen credit scores.
A quarter (25%) mistakenly believe that student loans are recorded in their credit report. Whilst 62% don’t realise that checking their credit report regularly can help protect them from potential fraud
Nearly one in five (23%) of the students surveyed said they had been targeted by scams or phishing whilst at college or university, with a further 35% having lost phones or laptops, or had them stolen.
James Robinson, TransUnion’s Managing Director of consumer interactive in the UK, said “Over a quarter (26%) of students have had trouble paying rent or bills, according to our research, so it’s really important they understand their credit report and score and how it works – and realise the impact that a missed payment can have. It’s very positive to see the number of Gen Z that are checking their credit score frequently but there are still a few misconceptions.”
“Credit reports are also used for identity checks to help prevent fraud and if someone tries to use your identity in a scam, your credit report may be the first place you’ll spot it. Under 21s are often a target for fraudsters[ii] so it’s essential they’re able to recognise some of the warning signs and can spot suspicious activity to try and prevent it.”