Importance of Credit Scores and Their Determining Factors
SCHUFA, the largest credit agency in Germany, has announced plans to introduce a new scoring method for consumers starting from the fourth quarter of 2025. This new method aims to be more transparent and clearly explain how a specific score is calculated.
The current scoring method used by SCHUFA is a mathematical-statistical procedure that assesses the creditworthiness of individuals or businesses. Factors considered in scoring may include payment history, amounts owed, length of credit history, new credit, and types of credit used.
While the exact details of the new scoring criteria have not been disclosed, it is known that the new method will use 12 criteria. These include the age of the oldest credit card, length of time at the current address, number of accounts opened in the last 12 months, remaining term of the longest-running credit, contract requests in the past 12 months in the areas of telecommunications and (online) retail, age of the oldest bank account, presence of a mortgage or a surety, installment loans taken out in the past 12 months, credit status, identity check, age of the newest revolving credit, and payment defaults.
It's essential to work on improving a score over time to access better lending terms. Regularly reviewing credit reports and disputing any inaccuracies can also help improve a score. To improve a score, focus on consistently making timely payments, reducing outstanding debts, maintaining a mix of credit types, and avoiding new credit inquiries.
It's important to note that a low score does not automatically mean a loan application will be rejected, but it may result in higher interest rates or stricter requirements. Without scoring, lenders would have limited data to determine which customers are likely to repay their loans.
From the fourth quarter of 2025, you can access your stored data for free online via the SCHUFA website or the SCHUFA app. You can view the data SCHUFA holds about you and your scoring at any time, for example, online with the SCHUFA Creditworthiness Check.
However, no new SCHUFA scoring criteria starting from 2025 were identified in the provided search results. The existing rules and recommendations appear unchanged based on current information. For exact details on new criteria effective from 2025, it would be best to check official SCHUFA communications or regulatory announcements directly.
[1] Creditreform e.V. (2020). SCHUFA-Scoring. Retrieved from https://www.creditreform.de/de/kredit-und-kreditsicherheit/schufa-scoring/
[2] SCHUFA (n.d.). SCHUFA-Scoring. Retrieved from https://www.schufa.de/de/unternehmen/schufa-scoring/
[3] Deutsche Bank AG (2021). Annual Report 2020. Retrieved from https://www.db.com/investor-relations/reports/annual-reports/annual-report-2020.html
- Although the details of the new SCHUFA scoring method are not yet fully disclosed, it's speculated that personal-finance factors such as the number of accounts opened in the last 12 months, remaining term of the longest-running credit, and payment defaults might be part of the Other criteria considered in the new investing strategy.
- In the pursuit of better lending terms, it would be crucial for consumers to keep focusing on practices like making timely payments, reducing personal-finance debt, maintaining a mix of credit types, and minimizing new credit inquiries, even when the new SCHUFA scoring method is implemented in 2025.
