UK finance jargon - in plain English
How much of your available credit you are currently using, as a percentage.
Credit utilisation is the ratio of your current credit card balances to your total credit limits. If you have a combined credit limit of £5,000 and are carrying £1,500 in balances, your utilisation is 30%. Lenders and credit reference agencies treat high utilisation as a sign of financial stress. Keeping it low signals that you are not overly reliant on credit, which tends to improve your credit score.
You have one credit card with a £3,000 limit and a balance of £2,700. Your utilisation is 90%, which most credit scoring models consider high. Paying it down to £600 drops utilisation to 20% and is likely to improve your score once your updated balance is reported to the credit reference agency, usually within a month or two.
Credit scoring models vary between Experian, Equifax, and TransUnion. As a general guide, staying below 30% is considered good practice, and below 10% is even better.
Last updated: June 2026. Sources: HMRC / GOV.UK / Student Finance England / FCA where relevant.
People focus only on making minimum payments and miss that high utilisation is quietly dragging their score down. You can have a clean payment history and still have a poor score if utilisation is consistently high.
Credit utilisation is calculated across all your credit cards combined. Staying below 30% is generally considered healthy. Below 10% is better still. These figures are illustrative — scoring models vary between Experian, Equifax, and TransUnion and are not publicly disclosed.
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