What is a credit history?
- By Book Keeping Pros
- Sources checked 15 Oct 2026
Definition
A credit history is a report detailing the past credit arrangements of a person or business, such as loans, credit cards and leases. A lender may look at it when assessing a loan application, and a credit rating, a ranking of how able someone is to repay a debt, is based on it.
A credit history looks backwards. It shows which credit arrangements a person or business has had, and a lender, leasing company or supplier reads it to judge how a new arrangement is likely to go.
The business's books hold its own side of the same story: each loan agreement, the statements from lenders and card providers, and the repayments made against them. Keeping those documents together, and reconciling loan and card accounts to their statements, means the business can check any report about its credit against what actually happened and query anything that looks wrong.
In Australia
business.gov.au's glossary describes a credit history as a report setting out the past credit arrangements of an individual or a business, and notes that a lender may ask for one when assessing a loan application. For more on credit reports, it sends readers to ASIC's Moneysmart website.
Its guide to leasing or buying a vehicle notes that a bad credit history can stop a lease application from going ahead.
Common mistakes
- Throwing away loan agreements and lender statements as soon as a loan is paid off.
- Leaving loan and card accounts unreconciled, so errors in what is owed go unnoticed.
- Using personal and business credit cards interchangeably, which blurs the business's own record of the credit it has used.
Related terms
Related service
Bank reconciliations
Each bank, card and loan account reconciled to its statement.
Sources
- Key financial terms
business.gov.au, Australian Government. Current at 15 October 2026, released 9 July 2024. Checked 15 October 2026.
© Commonwealth of Australia 2020, licensed under CC BY 3.0 AU. Licence: CC BY 3.0 AU.
- Leasing or buying vehicles and equipment
business.gov.au, Australian Government. Current at 16 October 2026, released 23 October 2024. Checked 16 October 2026.
© Commonwealth of Australia 2020, licensed under CC BY 3.0 AU. Licence: CC BY 3.0 AU.
- Apply for a business loan
business.gov.au, Australian Government. Current at 16 October 2026, released 18 February 2026. Checked 16 October 2026.
© Commonwealth of Australia 2020, licensed under CC BY 3.0 AU. Licence: CC BY 3.0 AU.