Does gambling affect your credit score in the UK?

A credit score is a three-digit number, calculated from your credit history and other factors, which indicates your trustworthiness when it comes to making a credit application. Lenders will use your credit score to determine whether they will loan you money, and how much interest or collateral should be put in place.

Those with a low credit score risk being denied credit applications, or offered higher interest rates. If you have a strong credit score, you are more likely to be able to borrow larger amounts at smaller interest rates.

Credit scores can often be indirectly affected by external factors—gambling usually falls into this category. You will not see instant changes in your credit score each time you gamble. Rather, the effects often come from other financial issues caused by gambling—for example, being unable to pay bills because your money is being spent on betting.

Will gambling have a negative impact on my credit rating?

In short, gambling will not have a negative impact on your credit score. Your credit score exists to determine whether or not you can be trusted to borrow money, not to analyse your spending habits. This isn’t to say gambling is safe—it should always be carried out with caution. 

Though a fun hobby, gambling can be an addictive and expensive pastime, causing people to fall behind on bills and other debt repayments. In turn, these things can cause a drop in your credit score. Another common negative credit score impact occurs when a loan is taken out to fund gambling debt, and isn’t paid back on time or in full.

Is gambling recorded on my credit report?

Individual transactions and bank statements are not included on your credit report, so there is no evidence of gambling through your credit score alone. When you apply for credit or a loan, lenders may further investigate your spendings, including requesting access to your bank statements. If it is evident that a large sum of money is being spent each month on gambling and online betting, your application may be declined.

As mentioned, for the majority your credit score will not be affected by the odd bit of gambling. The danger arises when other existing credit score factors are being impacted by your gambling habit. The following are potential risks for those who might develop a gambling addiction.

Loans taken out to fund gambling

Loans are always a credit risk. It can be easy for anyone to forget a repayment, but this possibility becomes greater when someone’s responsibility over their money lapses. Putting too much money into gambling may mean you are unable to afford your loan repayments, and a potential debt cycle begins. If you default on your loan, the negative impact on your credit score will be even greater.

Overdrafts and gambling debts

Similarly to taking out a loan, if your gambling habit takes you into an unarranged overdraft your credit score could be at risk. A form of credit that potentially has not been agreed with your bank, an overdraft is another form of debt that will incur interest. If the minimum monthly repayment plus interest is not paid, your credit score will take a hit.

Missed repayments

If you are gambling away money that is set aside for repayments on other money owed, you are putting your credit score at risk. Missed repayments are one of the most common and most harmful negative credit score factors. Repeated missed repayments will be recorded and go against any future credit applications you make. If you cannot afford these repayments, you should not be gambling.

Increased credit utilisation

Less common since credit cards have been disallowed for gambling payments, credit utilisation may still be a threat if lines of credit are being used to fund gambling. Revolving credit should be borrowed and paid back at a fast pace, so if you are spending without making consistent repayments, this is where you will see a negative impact on your credit score.

Less money going into savings

Possibly the most indirect, but very common implication of gambling is how it can prevent from building up savings. When looking at making a credit application—such as car finance, or a mortgage—you will often have to put down a large deposit in order to secure the loan. If large amounts of money are being spent gambling, it will take a longer time to build up your deposit.

Yes, mortgage applications—and normal loan applications—can be affected by a gambling habit. When a lender does their affordability assessment, any evidence of frequent gambling may result in their finance offer being withdrawn. Mortgage lenders are entitled to request bank statements and specific transaction details. They may be wary if they notice a large portion of your income is being gambled online.

It is very common to develop a gambling addiction—it is also very preventable. There are a number of methods which can help you to avoid getting into gambling debt, or to recover if you feel that you are already experiencing this.

Play for free

Most online gambling sites will offer free games. Experience the thrill of gambling, without the risk. It is important to be mindful of the urge to gamble real money. If free games are not satisfactory, another hobby or pastime may be worth considering.

Set limits on spend

Avoid spending more than you can afford by setting physical limits. Most sites will allow you to set a spend limit, after which you will be unable to play until your next session. There are also a number of banks which will allow you to set a spending limit before you even enter a gambling site. Most of these will also have resources to help you budget, meaning you may be able to build up your savings.

Never gamble with borrowed money

Whether borrowed from friends, family or the bank, you should always avoid gambling with money that isn’t yours. There is always the risk that you will lose this money, and this could be the beginning of a dangerous debt cycle.

Seek help and support if gambling becomes a problem

If you feel that gambling is becoming an addiction, or you would like to prevent that from happening, gambling and debt charities are available to help. Independent charities like BeGambleAware and GamCare offer free support to those who wish to stop gambling and take control of their finances. Reaching out to one of these charities is the best first step to tackle your gambling problem.

If you are looking to apply for a loan, but have a history of gambling that you think may affect your application, it may be worth seeking financial advice. There is free financial counselling available to those who need it at Money Helper.