It is possible that you have heard conflicting opinions about whether gambling can affect your credit score. We are here to help navigate the world of finance to help you make informed decisions for your own financial health and wellbeing. 

What is a Credit Rating?

Before we dive into the connection between gambling and your credit score, let's start by understanding what a credit rating is and why it matters. 

We have a dedicated, easy-to-digest blog post What is a Credit Score, that goes into the ‘just-right’ level of detail without having too much financial jargon.

But let’s just cover it briefly here, too! In essence, your credit rating - which is usually  summarised as a credit score, plays a huge role in your financial life. It influences your ability to secure loans, mortgages, credit cards, and even everyday essentials like mobile phone contracts.

When you apply for credit, lenders examine your credit report to assess whether you manage your money responsibly. This includes things like not accumulating too much debt and making payments on time. All this information combines to generate the magic number: your credit score.

How Does Gambling Affect Your Credit Score?

Now, let's address the big question: Does gambling directly affect your credit score?

The short and sweet answer is no, it doesn't. Your credit score primarily revolves around your financial behaviour concerning borrowed money. Lenders can’t pick apart your credit report for signs of gambling activity because it’s not registered. 

However, there is a catch!

Any hobby, including gambling, can lead to financial problems if taken to extremes. When gambling becomes an addiction that forces you into overdrafts, maxes out credit cards, or pushes you to borrow more money, these can directly affect your credit score. The key takeaway here is moderation. Responsible gambling, just like any other hobby, won't harm your credit score as long as it doesn't lead to financial distress.

Will Lenders Even Know If I Gamble?

You might be wondering if lenders can discover your gambling habits when you apply for loans or credit.

Gambling activity itself doesn't show up on your credit report. Credit reference agencies (CRAs) don't have access to transactional data from your bank statements.

However, some lenders may request your bank statements to prove you have affordability, especially for significant loans like mortgages and car finance. If your statements reveal a lot of transactions at casinos or betting shops including those online, it can raise concerns for lenders. Part of their role is to ensure that borrowing more money won’t put you into financial difficulty. So, while gambling won't directly impact your credit score, it can indirectly influence lending decisions.

If you plan to apply for substantial financing in the future, consider keeping your gambling activity in check for a while.

Gambling-Related Debt

While gambling itself doesn't directly harm your credit score, it can lead to financial difficulties if you find yourself unable to manage it. 

Here are some possible debt-related issues associated with gambling:

• Cash Advances: Using credit cards for cash advances (withdrawing more than your credit limit has been set to) can rack up interest and fees quickly.
• Casino or Bookies Line of Credit: Applying for a casino credit line might result in a temporary credit score dip due to hard inquiries.
• Emergency Loans: High fees associated with short-term loans can worsen your financial situation.
• Missed Payments: If gambling expenses tie up your funds, you may miss payments on other obligations. This is going to negatively affect your credit score.
• Increased Credit Utilisation: High credit card balances can hurt your credit utilisation ratio.

We have more information about How Overdrafts Affect Your Credit Score, as well as How Low Credit Utilisation Can Affect Your Credit Score.

If you find yourself struggling with gambling-related debt, there are strategies to help you regain control, and organisations that can help. Check out the UK GOV Gambling Commissions Site to see a list of different free and confidential places you can go to get help and advice.

If you have struggled with gambling in the past to the point that you have missed payments or experienced financial distress, it is still possible to get credit! Although defaults may affect interest rates, their impact will diminish over time if you take positive steps to improve your financial health. The best way to start is to try and boost your credit score. 

Ozoomi Boost is a simple and easy-to-navigate way to boost your credit score AND to start building a deposit. 

We have a nice, simple summary of how it works with six simple steps.

But for a quick summary here: you select a monthly payment that fits your budget. Ozoomi then provides you with a loan equal to this amount multiplied by 12, representing a year's payments (by the way, this is with 0% interest!). This amount is securely stored in a savings account. 

Make these monthly payments promptly, and we will inform credit reference agencies of your good money management – which is a green flag for future lenders.

Once the year ends, your loan is completely paid off, leaving you with a great deposit for a new car and an improved credit score, potentially leading to more favourable financial terms.