Your credit score is one of the most important numbers in your financial life, yet many South Africans don't know what constitutes a good score or how it impacts their ability to access credit. Understanding where you stand can make the difference between getting approved for that home loan or being turned away at the bank.
Understanding Experian's Credit Score Scale
In South Africa, Experian uses a credit score range from 0 to 740, with higher scores indicating better creditworthiness. Here's how the scoring bands break down:
Great (658-740): You're in the top tier of borrowers. Lenders see you as very low risk and you'll qualify for the best interest rates and credit terms available.
Good (634-657): You have a solid credit history. Most lenders will likely approve your applications, though you may not always get the very best rates.
Average (616-633): Your credit is acceptable but has room for improvement. You'll probably get approved for credit, but at higher interest rates.
Below Average (615-599): Lenders view you as higher risk. Credit approval becomes more difficult and expensive when available.
Poor (0-598): Accessing mainstream credit will be challenging. You may only qualify for secured credit or need to work on rebuilding your credit history.
What Makes a Score "Good"?
Generally speaking, a credit score of 634 and above is considered good in the South African market. This threshold puts you in a position where:
- Most banks and lenders will approve your credit applications
- You'll qualify for competitive interest rates
- You'll have access to premium credit products like platinum credit cards
- Landlords and employers (where permitted) will view you favourably
However, aiming for the "Great" category of 658+ will unlock the best possible terms and give you maximum financial flexibility.
Why Your Credit Score Matters
A good credit score doesn't just help you get approved for loans – it saves you money. The difference between a good and poor credit score can mean paying tens of thousands of rands more in interest over the life of a home loan. For a R1 million bond, even a 1% difference in interest rate translates to over R100,000 in additional costs over 20 years.
Building Towards a Good Score
If your score isn't where you'd like it to be, focus on the fundamentals: pay all your bills on time, keep your credit utilisation below 30% of available limits, avoid applying for multiple credit products in quick succession, and regularly check your credit report for errors.
Remember, building good credit is a marathon, not a sprint. Consistent, responsible credit behaviour over time is the key to achieving and maintaining that coveted good credit score that opens financial doors across South Africa.