What is credit history? Definition and meaning

Credit history refers to a person’s ability to repay debts. It forms part of an individual’s credit report. A credit report includes more details, such as age, sex, income, current debts, etc., while credit history just has details on how responsibly the borrower dealt with loans and paid bills.

Your credit history is held by credit bureaus, such as Experian, TransUnion and Equifax. They gather the data from organizations and companies that provide credit (loans), such as credit card companies, banks, utility firms and other sources.

Data from a person’s credit history, plus other information is used to create a mathematical algorithm, which is applied to a credit report to determine how likely he or she is to pay off a debt responsibly. In many countries the applicant is given a credit score – the higher the score, the more likely they are to repay a debt.

Credit HistoryCredit history is one of several factors that lenders take into account when determining whether to lend somebody money.

When somebody fills out a credit application form, their details are forwarded to a credit bureau, which matches the name, address and other identifying data with its own retained data.

The lender then looks at the credit report sent by the bureau and determines what the applicant’s creditworthiness is, i.e. his or her likelihood to pay back the debt according to the stipulations of the contract.



The applicant’s credit history helps determine the applicant’s willingness to repay a debt. If he or she paid bills and installments on time, they are much more likely to be granted a loan.

According to the Collins Dictionary, credit history is “A record of how promptly a person pays back loans, credits, etc, over time.”

Your credit history will contain the following information:

– how many credit accounts you have and had,

– the types of credit accounts you have and had,

– when each account was opened (and closed),

– how much you owe,

– how much of available credit you have used,

– how promptly your bills are paid,

– how many credit inquiries there have been.

Video – If you have no credit history

This video explains how you can get a credit card if you have no credit history.