What Are Credit Reference Agencies and How Do They Work?

Credit reference agencies are independent organisations that hold data about your creditworthiness. They will give you a score based on your financial history on how trustworthy you are when repaying what you owe. These agencies do not decide whether to approve your credit application, they just provide the information to the lender who makes the decision. The lender can use any one of these agencies, or they can use a combination of agencies in combination with other factors such as age and salary.

When you apply for a loan (e.g., mortgage, car finance, credit card, or mobile phone contract) the lender checks your credit history with the credit reference agencies. In the UK there are 3 different referencing agencies: Equifax, and Experian, TransUnion. Your score for each of the agencies may be different due to the differences in how each agency calculated your score.


Equifax score ranges between 0 to 700. The higher the score, the lower risk you are perceived to be by lenders. Therefore, you are more likely to be approved for higher loans with lower interest rates.