Poor credit scores cost UK families 3.5bn pounds a year

Cranfield School of Management

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Poor credit scores cost UK families £3.5bn a year

Having a poor credit rating is costing UK middle income households £3.5 billion every year according to new research conducted by Dr John Glen, a Senior Lecturer in Economics at Cranfield School of Management. 

‘The Cost of a Poor Credit Rating’ study commissioned by credit card provider aqua highlights that people with a poor credit rating in the UK are paying £3.5 billion more than people with good credit for identical products and services. The average family with a low credit rating spends an extra £1,170 each year on mobile phone contracts, utility bills, broadband, credit cards, white goods and cars purchased on finance.

Commenting on the findings, Dr John Glen said: “Simply put, poor credit is costing households in the UK billions. It’s alarming that often the people who need the most help are the ones who are charged more for everyday household products and services.”

Sarah Willingham, founder of letssavesomemoney.com and Cranfield MBA alumnus teamed up with aqua to create a series of videos providing credit card advice to help consumers understand the importance of managing their credit card responsibly.

Sarah said: “A poor credit rating can really impact the price you pay for all sorts of products and services. It's vital that people understand how important it is to have a healthy credit rating. As this report reveals, it could save you thousands of pounds each year. The great news is that there are simple things people can do to boost their credit rating.”

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