What is Experian?
Experian is the largest credit reference agency in the UK. It offers people the opportunity to check their credit score, as well as accessing a more detailed credit report, which shows personal information, existing financial arrangements and financial history. In addition to this, it has an "Identity Plus" service, which offers users protection against identity theft and fraud.
While it's possible to get a free Experian account, which enables you to check your Experian credit score, the CreditExpert service, which allows you to see your full report, comes at a cost after an initial 30-day trial. The Identity Plus features also attract a monthly fee. There is, however, the potential to increase your credit score for free with Experian Boost, which we discuss in more depth later in the article.
As is the case with all of the credit reference agencies, the credit score is calculated based on Experian's own scoring system and is expressed as a number, which can't be compared with credit scores generated by Equifax or TransUnion. What is more, each agency tends to access different sources of information and may not include the same credit agreements or events in your financial history, which means there can be significant discrepancies between them. This means it is worth checking your credit scores with all three credit reference agencies, rather than simply assuming each report will be the same.
Experian's key features
- It is the only credit reference agency that offers a way to instantly increase your credit score for free. Experian Boost uses open banking to review your spending habits, with a potential uplift applied to your score if you demonstrate you have, for example, made payments to subscription services, such as Netflix or Amazon Prime, paid council tax or regularly put money into savings or investment accounts.
- When you sign up to a free Experian account, your credit score and summary of total borrowing can always be viewed without charge.
- CreditExpert gives you daily updates and a more detailed breakdown of your borrowing, at a cost of £14.99 per month.
- Identity Plus monitors whether your identity is being used elsewhere on the web, gives you a daily fraud report and gives support if you believe you have been a victim of identity theft or fraud. This service costs £6.99 per month.
- Experian also acts as a credit broker and gives users a guide to how likely they are to be accepted for financial products with a number of lenders. They also have pre-approval and guaranteed-rate features.
How does Experian work?
Experian collates information from a number of different sources, including:
- Personal information, such as your date of birth, address and whether you are on the electoral roll.
- Existing credit agreements, including how much of your credit limit you are using (known as "credit utilisation"), your track record of making payments on time and any late or missed payments.
- Examples of problems with debt, including defaults, CCJs, IVAs and bankruptcy. These only appear on your credit report for 6 years before being removed.
Experian doesn't include information about your employment, salary or income, or health expenses. It does, however, look at how often you apply for credit, as well as whether you have been turned down for credit in the past.
It uses all of this information to come up with a score between 0-999, with 999 being the perfect score. This number gives lenders a guide to your potential credit worthiness, although different lenders will view your score differently rather than there being a one-size-fits-all approach. In short, viewing your Experian credit score, alongside your score with other credit reference agencies, will give you an indication of whether you are likely to be approved for credit, but it doesn't act as a guarantee.
What do Experian's credit ratings mean?
|Credit score||Rating||What does this mean?|
|Excellent||You are highly likely to be approved for even the most competitive credit products|
|Good||You are likely to be approved for most credit products|
|Fair||You are likely to be approved for credit products, but may have a reduced credit limit|
|Poor||You may get approved for some specialist products, but will probably have to pay a higher interest rate|
|Very poor||You are likely to be turned down for most products, except a handful of specialist options|
Is Experian accurate?
As with other credit reference agencies, Experian uses information collected from official sources, as well as from lenders. There is the potential for errors to occur or for out-of-date entries to drag your score down. Experian, Equifax and TransUnion also collect data from different sources, so your report will often vary significantly across all three, including the overall credit score you are given. It is, therefore, worth checking your report with all three providers, correcting any errors and making a note of the overall credit score for each. This is all the more important as you can't be sure which of the providers' reports lenders will use when you apply for products in the future. You could, for example, have checked your Experian score, but the lender refers to the Equifax report, which could have a different overall credit rating that makes you less likely to be accepted.
How much does Experian cost?
Experian is one of the more expensive options if you opt for full access to your credit report and score on a monthly basis, following the free 30-day trial, at £14.99 per month. Meanwhile, the Identity Plus option is £6.99 per month. It is, however, possible to just access your overall credit score for free. It also allows you to use Experian Boost, which can serve to immediately increase your Experian credit score.
Another way to access your Experian credit score is via checkmyfile. At a cost of £14.99 per month (free for the first 30 days) you can access your credit score with all three of the major credit reference agencies Experian, Equifax and Transunion.
Another way to access your Experian credit report is through the MoneySavingExpert Credit Club, which is free.
Is Experian safe?
In 2014, Experian, alongside Equifax and TransUnion, became regulated by the Financial Conduct Authority. This means it has to comply with certain standards, offering consumers protection. That said, it received an enforcement notice from the Information Commissioner's Office (ICO) about the way it has "used personal data within their data broking businesses for direct marketing purposes". The ICO has ordered it to make changes to "invisible" processing, where individuals are not aware "the organisation is collecting and using their personal data". Experian is appealing against the ICO ruling.
Experian customer reviews
According to independent customer review site Trustpilot, Experian has a satisfaction rating of 1.2 out of 5.0, from more than 1,200 reviews. 93% of respondents designated it as "bad", with many citing errors on reports and customer service issues as the reason for giving the company a low score. However, both Equifax and TransUnion also score less than 2 out of 5, with reviewers complaining about similar issues for each one, suggesting Experian is no worse than its competitors in how it is perceived by its users.
Pros and cons of Experian
- Experian Boost and the capacity it has to allow customers to instantly increase their credit rating sets Experian apart from its rivals
- The function that assesses how likely you are to be accepted for certain credit products and gives you guaranteed rates and pre-approval can help you avoid being turned down and risking denting your credit rating in the process
- Identity Plus can help protect you from identity theft and fraud
- Unless you access it through the MoneySavingExpert Credit Club or during the 30-day trial, it is relatively expensive
- Even if you know your Experian credit rating, you will still need to check your report with Equifax and TransUnion so you have an accurate idea of how you will be viewed by prospective lenders