What is credit utilisation? How much of your credit you use, and why it matters
By SendPay Business · · 2 min read
Credit utilisation is the share of your available credit that you are using, such as how much of your credit card limits your balances take up. It is one of the things lenders and credit reference agencies look at when judging how you handle credit.
How to work it out
- Add up the balances on your credit cards and credit lines.
- Add up their credit limits.
- Divide the balances by the limits and multiply by 100: £1,600 used of £5,000 is 32%.
Per card and overall
Utilisation is looked at for each card and across all of them. One card near its limit can stand out even when the overall figure is low.
How it is reported
Lenders usually report your balance to the credit reference agencies around your statement date, so that is the figure that counts, even if you pay in full afterwards. Paying some of the balance before the statement date lowers what is reported.
Bringing it down
Paying balances down is the most direct way. A higher limit also lowers utilisation if spending stays the same, though applying for new credit can have its own effect. Each agency scores differently, so there is no single figure that guarantees a good score.
Where SendPay fits
SendPay platforms include GBP, EUR and USD accounts and international transfers under your own brand, powered by licensed partners. SendPay doesn't offer lending.
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This guide is general information, not legal or financial advice. SendPay Business is a technology company, not a bank, and does not take deposits; regulated services on the platforms are provided by licensed partners. PayPal, Patreon and Substack are named as reference points only and are not affiliated with SendPay Business.