What Is a Credit Score in Australia and How Is It Calculated?

Most Australians know that a credit score exists and that a lower one is bad. Beyond that, the detail gets fuzzy. What does the number actually mean? How is it calculated? And what can you do if something on your file is dragging it down unfairly?

What is a credit score?

A credit score is a number that summarises the information on your credit file into a single rating, designed to give lenders a quick indication of how likely you are to repay a debt. In Australia, credit scores are calculated by the two main credit reporting bureaus — Equifax and Experian — each of which uses its own scoring model and scale.

Because each bureau uses different data and different methodology, your score can vary between bureaus. A lender may check one, two, or all three — and different lenders have different thresholds for what they consider acceptable.

What scores mean across the three bureaus

The scoring ranges are aligned between bureaus, the general bands look like this:

Equifax scores range from 0 to 1,200. A score above 853 is considered excellent; 735–852 is very good; 661–734 is good; 460–660 is average; below 460 is below average.

Experian scores range from 0 to 1,200. Above 800 is excellent; 700–799 is very good; 500–699 is good, 300–499 is fair; below 300 is low.

These are general guides — individual lenders set their own minimum thresholds and weight information differently, so a score that passes one lender's criteria may not pass another's.

What goes into your credit score?

Australian credit scores are calculated based on the information in your credit file, which includes several categories of data:

Repayment history. Under Comprehensive Credit Reporting (CCR), lenders report whether you paid your accounts on time each month. Consistent on-time payments build your score; late or missed payments reduce it. This is now one of the most significant factors in Australian credit scoring.

Negative listings. Defaults, court judgments, clearout listings, and serious credit infringements all reduce your score significantly. The size of the impact depends on the type of listing, how recent it is, and how many there are.

Credit enquiries. Each credit application you make generates an enquiry on your file. Multiple enquiries in a short period — particularly from non-prime lenders or buy now pay later providers — can reduce your score. Lenders interpret a cluster of enquiries as a potential sign of financial stress or repeated declines.

Credit history length. A longer history of responsible credit use generally contributes positively to your score. Newer borrowers with limited history will have less data for bureaus to assess.

Types of credit. Having a mix of credit types — a mortgage, a credit card, a personal loan — can contribute positively, though this is a relatively minor factor compared to repayment history and negative listings.

What doesn't affect your credit score in Australia

Several things people commonly assume affect their score don't actually show up on Australian credit files: your income, your savings, your employment history, your rent payments (unless reported by a specialist provider), and your bank account activity. Credit files record borrowing and repayment behaviour — not your overall financial picture.

Why your score can be different depending on where you check

If you've checked your credit score through a bank app, a comparison site, or a bureau's own portal, you may have seen different numbers in different places. This is normal — each source draws from a different bureau's data and applies a different model. A score from one bureau is not wrong; it's just one view of your credit file.

When your credit score doesn't tell the full story

A credit score is a summary — and like any summary, it can be misleading if the underlying data is wrong. A listing that was recorded incorrectly, a default that shouldn't be there, or an enquiry that was made without your consent can all drag your score down in a way that doesn't reflect your actual credit behaviour.

Improving a score that has been pulled down by an error isn't about waiting — it's about investigating whether the underlying listing was recorded correctly and, where it wasn't, challenging it through the right channels. Edit Credit offers a free assessment to review what's on your file and identify whether anything looks challengeable. Visit editcredit.com.au/personal to find out more.