According to a new report, even among those who are familiar with the term credit rating, which refers to “a calculation of someone’s ability to pay back money which they have borrowed” – there is a lack of knowledge about their own credit history and what factors can affect their score.

Six in ten don’t know what their own current credit rating is, while 40% say they have never checked their credit rating and 36% have not checked their credit rating in the past 12 months.

Nerys Lewis, head of credit cards at Confused.com, said: “It is important to know the facts about your credit rating as it can affect your ability to apply for things such as mortgages, loans and get the best credit card rates.

“If you don’t know that using your credit card for online gambling can affect your rating, for example, you could potentially be harming your score without realising it.”

More than one in four didn’t know that multiple applications for a credit card can potentially affect your credit rating.

But 7% of credit card owners have previously been rejected for a credit card and applied for another in the space of a few weeks, which leaves a negative mark against your credit rating.

Meanwhile, more than half didn’t know that taking out a payday loan can potentially affect your credit rating, which it can both positively and negatively.

Even online gambling with your credit card can have an impact on your credit rating, which 87% of those failed to realise. However, 5% wrongly thought putting alcohol on plastic could harm your credit rating.

Lewis added: “Just because you have a perfect credit rating, however, doesn’t guarantee you’ll be accepted for every financial product, so make sure you only apply for ones that are suited to you.”

Get up-to-speed with the the truths and lies of your credit ratings here.