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Do utility bills (like your energy bills) affect credit scores?

Jan 3, 2023

It would be nice if your regular payment of utility bills (gas, electricity and  water bills) counted towards your credit report and positively affected your credit score, right? Read on, because when it comes to credit, Loqbox knows the score!

What is my credit score and how can I check it?

Your credit scores (plural - you actually have three – one with each of Equifax, Experian and TransUnion) are numerical summaries of your credit report. They let you know how creditworthy your credit report information looks to potential lenders (for when you apply for credit like loans, credit cards or mortgages). Generally, the higher your credit scores the better. You can read more about what a credit score is here.

If you’re not sure what your credit scores are, you can check it with each of the three main credit reference agencies (CRAs: Experian, Equifax and TransUnion) for free and without hurting your credit score using these services:

ClearScore (uses Equifax data)*

Credit Club (uses Experian data)

Intuit Credit Karma (uses TransUnion data)

*Just for transparency, we work closely with ClearScore, so signing up using this link triggers a small commission for Loqbox.

For more information on the credit reference agencies, who they are, what’s the difference and which ones do lenders use, check out this blog. But after you’ve checked your scores, let’s dive into how your utility bills affect them!

Wait, what utility bills are we talking about?

Utility bills are regular payments that you make to companies for ongoing and recurring services that keep your household running.

Traditionally, utility services are for the ongoing household bills,  like gas, electricity, water and sewerage.

But some people also classify their telecoms in this too (landline and internet). And similarly, Council Tax, which although isn’t a utility bill, is considered an essential household bill. So to make it easier, for this article we’ll use “utilities” as an umbrella term to discuss all of the above.  For the purposes of this blog, “utilities” doesn’t cover mobile phone contracts, credit card bills or loan repayments, but we’ll touch on those too. 

Utility bills can be paid monthly, quarterly or annually. It is also possible to pre-pay for some services like electricity and gas.

Does paying bills build credit?

It depends on how you pay your bills (i.e. by direct debit). Your credit report may list the utility accounts that you have (or had open in the past), but it depends on the provider and how they choose to report your bills to the credit reference agencies.  

On top of that, not every utility provider is reporting to all three credit reference agencies. For instance, your electricity may be reported to Equifax and Experian, but your water may only be reported to TransUnion. It’s best to ask your provider for a direct answer!

Even if your credit scores aren’t benefiting from making these regular payments, it’s important to know that they can be damaged if you fall behind on your payments.  

It’s likely that missed payments will find their way to your credit report when the debt collection process starts, and once it’s on your credit file it can stay there for six years. It’s also important to know that the debt can lead to more serious defaults and CCJs.  So speak to your provider if you’ve fallen behind with your bills, as they should have a team trained to help you and it’s a better solution long-term than not dealing with the debt.

Do phone bills affect credit scores?

When you take out a mobile phone contract, you’re essentially creating a credit agreement to pay off the total amount (for the usage and/or the cost of the handset). If you pay it off in monthly installments for a fixed amount of months, then it’s very likely this is being reported to at least one of the credit reference agencies.

So the same warning goes for missing payments as above! But it’s more likely your monthly mobile phone bill is helping to positively build your credit history over time as you pay it off as promised, on time and in full each month. To find out more about how a phone contract could affect your credit score, check out this blog.

The same goes for any credit agreement like a credit card bill or regular loan repayment!

So, how can I build my credit score?

If you’re looking for a way to give your credit score a boost, what options do you have? Well, for a proven way to build your credit score, get started with Loqbox!

With responsible use, we can help you boost your credit score by reporting your regular payments with us to Equifax, Experian and TransUnion.

Our simple £2.50 a week membership can help build your credit history with
Loqbox Grow, as well as give you access to our other great credit-building tools like Loqbox Save and Loqbox Rent

Give your credit score a boost with Loqbox

For just £2.50 a week, you could see your credit score rise by up to 300 points in the first three months

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