🚀 Your First Bank Account — KOHO
KOHO is Canada's most popular first bank account for teens and students. No monthly fees, no minimum age restrictions, instant setup. Start building good money habits today.
Open KOHO Free — Code 45ET55JSYAHow Credit Scores Work in Canada — A Guide for Teens
Your credit score is a number between 300 and 900 that tells lenders how likely you are to repay borrowed money. It follows you through your entire financial life — affecting whether you can get a credit card, a car loan, a mortgage, or even some rental apartments. Understanding it as a teenager gives you a massive head start.
Credit Score Ranges in Canada
| Score Range | Rating | What It Means |
|---|
| 800–900 | Exceptional | Best rates on everything |
| 720–799 | Very Good | Easily approved, competitive rates |
| 660–719 | Good | Approved for most products |
| 560–659 | Fair | Limited options, higher rates |
| 300–559 | Poor | Difficulty getting approved |
The two major credit bureaus in Canada are Equifax and TransUnion. You have a score at each. Lenders may check one or both when you apply for credit.
What Goes Into Your Credit Score
| Factor | Weight | What It Means |
|---|
| Payment history | ~35% | Did you pay on time? Most important factor. |
| Credit utilization | ~30% | How much of your credit limit are you using? |
| Length of credit history | ~15% | How long have your accounts been open? |
| Credit mix | ~10% | Variety of credit types (cards, loans, etc.) |
| New inquiries | ~10% | How many new credit applications you've made |
How to Start Building Credit as a Teen
You can't have a credit score without having credit. Here's how to get started once you turn 18 (or 19, depending on province):
- Get a student credit card — even with a low limit of $500
- Use it for one small, recurring expense — like a subscription or phone bill
- Pay the full balance every month — on time, without fail
- Don't max out the card — keep usage below 30% of your limit
- Don't close the account — even if you get another card, keeping old accounts open lengthens your history
Pro tip: KOHO offers an optional Credit Building feature (on paid plans) that reports to Equifax monthly. This is one of the few ways to build credit without a traditional credit card.
Things That Hurt Your Credit Score
- Missing a payment — even by a few days
- Maxing out your credit card
- Applying for multiple credit products in a short period
- Having an account sent to collections
- Co-signing a loan for someone who then misses payments
Important: Negative marks (like a missed payment) stay on your credit report for 6 years. Positive history also stays — so every on-time payment builds your reputation over time.
How to Check Your Credit Score for Free
- Borrowell — Free Equifax score, updated weekly
- Credit Karma — Free TransUnion score
- Mogo — Free Equifax score
- Your bank's app — Many Canadian banks now show your score in the app
Checking your own score is a "soft inquiry" and does not affect your score. Only applications for new credit (hard inquiries) affect it.
FAQs
Do teens have a credit score in Canada?
Only if you've had credit in your name. Most teens under 18 have no credit history. You begin building a score once you open a credit card or loan in your own name after age of majority.
What's a good credit score for a 20-year-old in Canada?
Anything above 660 is solid for someone who just started building credit. At 20, having a score of 680–720 means you've been managing credit well for a couple of years.