Credit Score Basics > How ClearScore works in the UK

How ClearScore works in the UK

Wollit Team2 minute read · Updated 30th June 2024

ClearScore is a UK-based fintech that provides free credit scores, credit reports, and affordability scores.

In fact, when it launched back in 2015, ClearScore was the first company in the UK to provide scores and credit reports for free.

It also offers other services, such as a marketplace for credit cards, loans, and car finance and an identity fraud protection service.

Is ClearScore legit?

ClearScore is very safe.

It accesses your data using Open Banking, a technology regulated by the Financial Conduct Authority (FCA), the UK's financial watchdog. So far, there have been no incidents with Open Banking. In fact, almost all leading UK banks use it: Bank of Scotland, Halifax, HSBC, Lloyds, Monzo, Natwest, and many others.

ClearScore is also bound by the Data Protection Act, a law that ensures that your information is handled safely. Under this act, companies that mishandle your personal data could be fined up to £17.5 million or 4% of their annual revenue, whichever is higher.

ClearScore has also grown from a UK startup into a global company with almost 400 employees. As of 2024, it operates in the UK, South Africa, Australia, New Zealand, and Canada, and earns over £100 million worldwide from over 20 million customers.

It also has partnerships with over 150 financial institutions around the world, from large banks to small financial technology companies.

How does ClearScore work?

ClearScore uses data from Equifax, one of the leading credit reference agencies in the UK, to show you your credit score and credit report for free.

Once you sign up to ClearScore, you'll be able to see a timeline of your finances and credit history. You'll also be provided with a list of factors that are pushing your credit score up or down, and tips on how to improve it.

To see the same information on Equifax's website, you would have to sign up for a paid subscription worth £14.95.

So, how does ClearScore make money?

First, ClearScore earns a commission every time you sign up for a product from one of its partners, such as a credit card or a car loan.

Second, ClearScore also offers a few premium subscriptions, like ClearScore Protect, which monitors the "dark web" to determine whether your personal data has been leaked or is being used by fraudsters.

How can I improve my ClearScore rating?

First of all, keep in mind that we're talking about your Equifax credit score here. Equifax and the other two leading UK credit reference agencies – Experian and TransUnion – might show slightly different credit scores, but they look for the same things. They all want to see that you pay your debts on time, are easy to find, and don't live on credit.

To improve your credit score, you can do a couple of things:

Make all payments on time and avoid missed payments. Pay everything on time, whether it's your phone bill or rent. Missed payments are worse than late payments, but they all harm your credit score.
Remove ex-partners from your credit report if you are no longer financially connected with them. You should do this even to former flatmates – sometimes they can show up on your credit report even if you weren’t aware of it.
Check your credit report regularly to make sure that your personal details are correct.
Register on the electoral roll to ensure that lenders and credit reference agencies can easily verify your address.
Sign up for identity protection – even a free service is good, although there are also premium ones.
Use an eligibility checker before applying for a credit card or loan.
Once you apply for credit, only apply for one product at a time. Space your applications out.
Don't use too much of your credit limit – it's best to stay under 30%.

Finally, it's also a good idea to try a credit building tool like Wollit.

Wollit reports your monthly plan payments to all three credit agencies, helping you build a credit history and improve your credit score. It also reports your rent payments, showing potential lenders that you're financially responsible when it comes to settling your bills on time.