Do Other Countries Have Credit Scores?
Updated · Oct 17, 2022
Around 80% of Americans have at least one credit card. If you live in the US, credit is probably an essential part of your life. And your credit score determines your financial success.
So, if you’re planning to live abroad for a while, it’s only natural to wonder how to get credit there.
Do other countries have credit scores?
What happens with your US credit score when you leave the country?
Read on for the answers to these and other questions.
How Do Credit Scores Work in the US?
Your credit score is a number between 300 and 850. Lenders use it to determine your creditworthiness.
There are three major credit reporting agencies—TransUnion, Equifax, and Experian.
They calculate your score based on your payment history, amount of debt, the age of your accounts, new credit inquiries, and your credit mix.
You start with no score and need to get credit to build it.
The higher your credit score is, the easier it will be to get approved for a loan with favorable terms.
At least that's how it works in the US.
But are credit scores international?
Do Other Countries Have Credit Scores?
Most countries have similar credit systems, but they use other terminology and scoring ranges.
Of course, some rely on entirely different methods to determine borrowers’ creditworthiness.
Let's see what countries have credit scores and how they calculate them.
The Netherlands has one primary credit bureau, the Bureau Krediet Registratie (BKR).
Lenders report to it every consumer credit account for more than $250 with a repayment term longer than a month.
The BKR keeps track of the accounts’ credit type, amount, term, termination date, and missed payments. The negative information stays in your files for five years.
That said, there is no credit score in the Netherlands. Instead, lenders review the BKR files to determine your creditworthiness.
Canada does have credit scores. They are calculated similarly to the ones in the US.
The main difference is that Canada has two major credit reporting agencies, Equifax and TransUnion.
Just like in the US, calculations are based on your payment history, credit utilization, length of credit history, and types of credit.
The scoring range in Canada is 300 to 900. Any score of 650 or above is considered good.
The United Kingdom
The UK has credit scores that are almost the same as those in the US.
There are three major credit agencies—Equifax, Experian, and Callcredit (Noddle). They all have different score ranges.
Experian uses a 0-999 scale, Equifax produces a number between 0 and 700, and Callcredit gives you one to five points.
Your credit score is based on things like your payment history, the age of your accounts, and your debt-to-credit ratio.
Australia also has credit scores.
There are four major credit bureaus in the country: Experian, Equifax, and Illion. Illion and Experian use a score range of 0 to 1000, and Equifax—0 to 1200.
In 2017, the Australian government changed its credit scoring system.
Previously, a person's credit report would only list negative items, like missed or late payments.
But now, they also include up to two years of positive financial information.
Germany’s scoring system is similar to the one in the US.
The leading credit bureau in Germany is called SCHUFA. This agency keeps track of people’s borrowing activity, balances, payments, etc.
Every person in Germany starts with a credit score of 100. The number decreases if you’re late with your payments.
Anything above 95 is a good score.
Japan doesn't have credit scores or a formal, nationwide credit system. Instead, each bank makes judgments based on its relationship with the borrower.
It looks at factors like the person's salary, length of employment, and current debts to determine their risk profile.
The credit score system in France is similar to the one in Japan. It doesn't have credit reporting agencies.
Instead, The Bank of France, called FICP, keeps a record of people’s negative activity.
Lenders check a person’s file before they make a decision.
Spain doesn’t use credit scores. It has a credit register called the Risk Management Center (CIR) that tracks people’s activity.
Similar to the French system, credit files in Spain list negative activity.
If the report contains severe or many negative items, the consumer can be blacklisted for up to six years or until they pay off their debt.
China is the most peculiar case in our list of countries with credit scores.
In 2001, it launched its notorious social credit system.
The aim was to track consumer credit data from criminal, government, and financial records.
However, it was severely criticized for penalizing people for activities unrelated to credit, like online comments and littering.
As a result, as of 2021, it exists as a rewards program and accepts only voluntary applications.
In terms of determining people’s creditworthiness, China relies on credit history reports by the People’s Bank of China. It doesn’t use credit scores.
Using Credit While Living or Traveling Abroad
Credit scores aren’t international. They apply only to financial institutions in the US.
If you want to get credit outside of the US, there are a few things you'll need to keep in mind.
First and foremost, credit scores in other countries may be calculated differently than they are in the US.
As a result, your US credit score isn’t an accurate reflection of your creditworthiness in another country.
In addition, lenders may not be willing to extend credit to individuals with no credit history in their home country.
So, to get credit in another country, do your research and find out what you need.
If you're only traveling and need to use a credit card abroad, you can get one that is suitable for international travel.
Most importantly, look for an issuer that doesn't charge foreign transaction fees.
How to Maintain Your US Credit Score When Leaving the Country
If you are planning to move outside of the United States, there are a few things you need to do to maintain your credit.
Ideally, you need to keep your US address. If you don’t have a physical address you can use, you can subscribe to a virtual mailbox service.
You will also need to notify the credit card company about your relocation. It needs to know whether you plan to use your credit cards overseas.
Lastly, you should keep up with your payments. Your credit score doesn’t follow you to another country but your debt does.
If you fall behind on your payments, it will damage your credit score.
Leaving the country for a longer period of time can have a lot of implications for your credit history.
While many other countries do have credit scores, they often calculate them differently.
In this article, we explained how to build a credit history and get credit abroad.
With an eye for research, Aleksandra is determined to always get to the bottom of things. If there’s a glitch in the system, she’ll find it and make sure you know about it.