If you’re shopping around for a loan, credit card, or store account, it’s only natural to want the best deal. But here’s what many South Africans don’t realise: too many credit applications in a short time can hurt your credit score, make you look risky to lenders, and even cost you a better interest rate.
How Credit Checks Work in South Africa
When you apply for credit, the bank or lender does a hard enquiry on your credit report. This mark stays on your profile for 12 months and can cause your score to dip for a short time.
A few hard enquiries spread out over time are normal, but if you apply to several lenders all at once, it could send the wrong message. Lenders may think:
- You’re struggling to manage your current debt.
- You’re in urgent need of money.
- You’re taking on more credit than you can realistically handle.
This perception can make them cautious, which might lead to declined applications or higher interest rates.
By contrast, soft enquiries—like checking your own credit score or using a prequalification tool—don’t affect your score at all. These are safe ways to explore your credit options without leaving a mark.
Why Limiting Applications Protects You
Submitting multiple applications in a short space of time can:
- Lower your approval chances.
- Make lenders less willing to give you a competitive interest rate.
- Reduce your negotiating power.
If you’re looking to consolidate debt into a single loan, it’s smarter to compare offers carefully and only apply where you’re most likely to qualify. You’ll probably only take up one offer anyway, so there’s no benefit in applying everywhere.
How to Compare Without Damaging Your Score
- Use prequalification tools – Many South African banks and lenders offer prequalification, which gives you an idea of your rates and terms with only a soft enquiry.
- Time your applications – For car finance or home loans, submit applications within a 14–45 day window so credit bureaus count them as one enquiry.
- Space out other applications – For smaller credit products like credit cards or personal loans, wait at least six months between applications to keep your profile healthy.
Keep Your Credit Profile in Shape
Protecting your credit score isn’t just about limiting applications. You should also:
- Pay on time, every time – Set up debit orders and make sure there are enough funds in your account.
- Use less credit than you have available – Try to stay below 50% of your limit, or even better, under 30%.
- Think before you apply – If you don’t truly need the account, skip it.