How to improve your credit score this year

Along with your new year’s resolutions to lose weight, get more sleep and improve your finances, it is also important to look after your financial reputation by improving your credit score.

Your credit score is the cornerstone of your financial wellbeing, as it represents your ability to manage your finances and your life, while it also gives you access to credit and other financial services.

The four major credit bureaus in South Africa use a common scoring model, ranging from 300 to 740. Scores (using the Experian methodology) are typically categorised as:

• 660 to 740: excellent
• 635 to 659: good
• 629 to 635: fair
• 600 to 628: poor
• 300 to 599: very poor. 

The benefits of a higher score can include lower interest rates on credit, higher borrowing limits and increased trust with lenders.

ALSO READ: How to improve your credit score

Strategies to improve your credit score

Paul Shortridge, head of credit risk and data at Weaver Fintech, shares these five simple strategies that will help you to improve your credit score in 2025:

#1: Pay your bills on time:

Consistently pay your bills on time, as your payment history is the most important factor in determining your credit score. Set up automatic payments or reminders to help you stay on track and also allow AI algorithms to upweight your score.

#2: Manage your credit use: 

Ideally, you should keep your credit use below 50% of your available limit. This means if you have a limit of R10 000, you should aim to carry no more than R5 000 in balances at any given time. This helps signal to lenders that you are a responsible borrower.

#3: Regularly monitor your credit report:

Know your credit status by using the many free tools available. You can then manage any errors, outdated information and changes in your credit score.

#4: Diversify your credit portfolio: 

Having a mix of credit types, such as credit cards, instalment loans (like car loans or bonds) and retail accounts, can be positive for your score. However, beware of opening accounts you do not need. Opening too many new accounts at once can have a negative impact on your borrowing history. 

#5: Consider credit building solutions:

If you have a lower score or no credit history, there are options to improve your credit standing by taking out mobile phone contracts, using Buy Now Pay Later facilities and opening retail accounts. These methods allow consumers to establish a history of timely payments and responsible credit use. 

ALSO READ: The link between your money mindset and your credit score

Emerging trends

While traditional methods of credit scoring remain critical, Shortridge also believes that some emerging trends in the industry may shape future methodology.

“At Finchoice and at PayJustNow we have been building, testing and using advanced artificial intelligence (AI) algorithms to develop more personalised and dynamic scoring models. These systems, coupled with a combination of machine learning and human insights, enable us to provide more flexibility and nuance in how scores are calculated, allowing us to better service our customers when it comes to access to credit and financial inclusion.” 

He says there is an increase in the use of alternative data globally, such as utility payments, rent payments and even subscription services, to assess your creditworthiness.