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How your mobile phone can help to improve your credit score

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Matt Bradfield

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At a glance

  • Defaults on your mobile contract will show on your credit report
  • Missed mobile payments can stay on your report for six years
  • A mobile phone contract will need your credit score to be checked

Taking out a mobile phone contract is a form of borrowing and it will show up on your credit report. Manage your phone contract well and make payments on time and you’ll improve your credit score. But if you miss a payment or are late to pay, your credit score could be negatively affected.

How does a mobile phone contract affect your credit score?

Getting a mobile phone contract usually involves making an initial payment and then a regular monthly payment covering fees for using the mobile network and the outstanding cost of the phone itself. The way you manage these repayments on your phone contract can affect your chances of getting credit elsewhere.

Fail to make a payment and you run the risk of having a default added to your credit report. Mobile phone contracts are not covered by The Consumer Credit Act, which means providers can decide if and when they want to report an account as being in default to the UK’s credit reference agencies.

On a more positive note, having a mobile phone account on your credit report can improve your credit rating. Making payments on time will help to demonstrate to potential lenders you approach in the future that you can be trusted to pay back what you owe.

I’ve missed a mobile phone payment; how long will this show on my credit report?

If you miss a mobile phone payment and your provider reports this as a default, it can appear on your credit report for up to six years. This can affect your ability to get other credit during this time. Its impact on your credit score will eventually decrease and keeping up with future repayments will help to repair your credit rating.

How to check your credit report to get a mobile phone contract

Taking out a phone contract is a form of credit, and providers will require you to pass a credit check before they’ll give you a contract. Being approved for a mobile phone contract can be easier than obtaining other forms of credit, but if the provider isn’t happy with your credit score they may refuse you a contract or place restrictions on your usage.

It's important to make sure your credit report is accurate before applying for any form of credit, including a mobile phone contract. Any inaccuracies in your data could see you being wrongly refused credit or being hit with higher repayments.

You can take a look at your own credit report using a credit check service.

Improve your credit score

LOQBOX helps to grow your credit score while you save. Decide what you could save in a year. They lock away a 0% loan for that amount in your LOQBOX. You pay off the loan over 12 months, growing your credit score as you go to unlock better borrowing. Once your loan is repaid, you release every penny into a new bank account for free. Or into an existing account for £30.

Disclaimer: This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

a women on her phone and laptop

At a glance

  • Defaults on your mobile contract will show on your credit report
  • Missed mobile payments can stay on your report for six years
  • A mobile phone contract will need your credit score to be checked

Moneyfactscompare.co.uk will never contact you by phone to sell you any financial product. Any calls like this are not from Moneyfacts. Emails sent by Moneyfactscompare.co.uk will always be from news@moneyfacts-news.co.uk. Be ScamSmart.

Moneyfactscompare.co.uk will never contact you by phone to sell you any financial product. Any calls like this are not from Moneyfacts. Emails sent by Moneyfactscompare.co.uk will always be from news@moneyfacts-news.co.uk. Be ScamSmart.