Credit Reports in South Africa
A Guide to the credit bureaus in South Africa
If you're considering taking out a mortgage or financing a car in South Africa, having a good credit score is essential. Lenders rely on credit bureaus to obtain information about you before approving your credit applications. To ensure your credit score is healthy, it's important to check your credit report with South Africa's main credit bureaus, including:
- Experian
- TransUnion
- Compuscan (now owned by Experian)
- XDS
Understanding Credit Bureaus
Credit bureaus in South Africa serve as the ultimate guides to your credit report. These bureaus consolidate credit reports from various sources, enabling you to assess and improve your credit status.
Credit bureaus obtain information from lenders and other sources, who also consult them before lending you money. Consequently, understanding your credit report is crucial.
How do you check your credit score?
Experian
- Access to one free report per year through Experian’s CreditExpert service Or you can pay R21 for a month’s subscription or R145 for a yearly subscription.
- Scores range from 0-705
TransUnion
- You can get access to your report once a year for free
- After your one free report you will have to pay R40 for one report or you can pay R40 per month for a subscription
- The score ranges from 0-999
XDS
- Credit4Life lets you get 30 days free access to your XDS report
- Or you can join the Credit4Life consumers club which gives you access to your report for R99 annually.
If you want to improve your credit score, check out our article.
Understanding Credit Reports
A credit report is a detailed record of your credit history prepared by the credit bureaus. It assesses your creditworthiness and determines credit limits.Information included in a credit report:
- Current and previous addresses
- Employment history
- Number and type of accounts
- Payment history
- Account opening dates
- Credit enquiries
- Details of accounts handed over for collection or with judgments against you
Who Uses Your Credit Report?
Various entities consult your credit report, including:
- Current and potential credit providers
- Insurance companies
- Rental property landlords
- Potential employers
- Debt collectors
- Utility providers (cell phone, prepaid electricity, etc.)
The Importance of Credit Rating
Maintaining a good credit rating is crucial, as it impacts your present and future circumstances:
- Buying a house
- Buying a car
- Starting a business
- Getting a job
- Getting lower interest rates
Tips to Improve Your Credit Score
- Pay the full monthly instalment amount on time for each account. If you're struggling to make payments, contact your creditors to arrange a payment plan.
- Limit your credit utilisation to under 35% of the given limit. For example, if you have a store card with a limit of R1,000, aim to maintain a balance under R350.
- If you have any outstanding judgements or administration orders, take immediate steps to repay the outstanding amounts in full. Once paid, this information can be removed from your credit profile.
- Maintain a healthy mix of credit, including home loans, vehicle finance, service contracts, cell phone accounts, and store and credit cards (if necessary). This will help establish a strong credit history if balances are not overdue.
- Limit the number of account applications and enquiry activity. Too many applications indicate financial distress or changes in circumstances.
- Regularly check your credit report and score. If you identify any inaccuracies or potential identity theft, immediately contact the credit bureaus to dispute the information.
By following these pointers, you can improve your credit report and increase your credit score.
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Meerkat is a registered financial services provider committed to empowering South Africans do MORE with their money. They do this by helping people:
- Get out of debt.
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