Credit cards, car loans, and personal loans all have the ability to affect your credit. In fact, the best way to build good credit is to make sure you make these bill payments on time every billing cycle.
But what about cell phone bills? Does your phone bill affect your credit score in Canada?
Key Points
- Cell phone bill payments may affect your credit score if you’re on a post-paid plan and your cell phone provider reports payments to the credit bureaus.
- You can use your cell phone bills to build good credit by making payments on time every billing cycle.
- If you’re not on a post-paid plan, consider paying via your credit card if your goal is to build good credit.
Does Paying Your Phone Bill Build Credit In Canada?
Many cell phone companies in Canada report their customers’ payment activities to at least one of Canada’s two major credit bureaus; Equifax and TransUnion. That means your cell phone bills may end up on your credit report and potentially affect your credit scores.
Whether your credit score is impacted positively or negatively depends on how you manage these bills and whether they’re reported to the credit bureau.
When it comes to building good credit, your cell phone bills can help in the following situations:
You Make Timely Payments
If your cell phone provider reports your payments to the credit bureaus, your timely payments will be recorded in your credit report. This will help you build a positive payment history, which may help improve your credit scores. Timely payments may also help you avoid late penalties and future debt collection problems, and provide an easy way to build a credit history if you don’t have one.
However, it’s important to remember that late and missed payments will also be reported, which can negatively impact your credit. So, be sure to make these payments on time.
You Make Credit Card Payments
You can also build your payment history by paying your cell phone bill through your credit card. Credit card companies typically report to one or both credit bureaus. This is a good option if your cell phone provider does not report your payments to the credit bureaus.
Just be sure to pay your bills in full when possible, much like your cell phone bills. While partial and minimum payments can stop late fees, the added debt can affect your debt-to-credit ratio, which may negatively impact your credit.
Do Cell Phone Companies Report Your Phone Bill Payments To The Credit Bureaus In Canada?
Here’s how some of the most popular cell phone companies in Canada operate when it comes to reporting your bill payments to Equifax and/or TransUnion
| Bell | Bell reserves the right to report your Bell credit history. |
| Rogers | Rogers reports their clients’ accounts to Equifax and TransUnion after each monthly billing cycle. |
| Fido | Fido reports their clients’ cell phone accounts to Equifax and TransUnion on a monthly basis. |
| Koodo | Koodo reports your entire payment history to both credit bureaus. |
| Telus | Telus reports your payment activity to both of Canada’s credit bureaus regularly |
Does Bell Report Cell Phone Payments To The Credit Bureaus?
Bell reserves the right to report your Bell credit history to credit bureaus, lenders, collections agencies and other Bell Company businesses. When initiating your cell phone plan, they’re also allowed to retrieve your credit details from those same parties. This makes it easier for Bell to collect your payments.
Does Rogers Report Cell Phone Payments To The Credit Bureaus?
Rogers reports their clients’ accounts to Equifax and TransUnion after each monthly billing cycle. The process begins in the first month following the account’s activation and finishes when the account is deactivated and the final balance is paid.
Does Fido Report Cell Phone Payments To The Credit Bureaus?
Fido also reports their clients’ cell phone accounts to Equifax and TransUnion on a monthly basis. If you check your credit report, you’ll find the associated details in the “Trade Line” section of the file. Once again, delinquent activities, like late payments and outstanding debts, are the most likely to get reported.
Does Koodo Report Cell Phone Payments To The Credit Bureaus?
Koodo reports your entire payment history to both credit bureaus. So, on-time payments can help build good credit, but any missed payments may hurt your credit. Activating “pre-authorized payments” in your Koodo account can help you avoid these debt collection issues.
Does Telus Report Cell Phone Payments To The Credit Bureaus?
Telus reports your payment activity to both of Canada’s credit bureaus regularly. So, missed payments can hurt your credit.
Can Unpaid Cell Phone Bills Hurt My Credit In Canada?
Failing to pay your cell phone bills on time could negatively affect your credit. However, it depends on the credit scoring model used to calculate your score and whether your cell phone provider reports the payment to the credit bureaus.
Credit Check
When you take out a cell phone plan, the provider may pull your credit report, which is referred to as a ‘hard inquiry’. When this happens, your credit score may take a slight hit, though this is usually temporary. Your score should bounce back up in the near future, as long as you continue to be responsible with all your bill payments.
Payment History
If your late payments are reported to the credit bureaus, it may negatively impact your credit scores. Your payment history generally accounts for around 35% of your credit scores, depending on the credit scoring model used.
Note: It’s important to remember that banks, lenders, and creditors have their own credit scoring models. They can choose which information they want to use when calculating your credit score.
While some may include your cell phone payments in their calculations, others will not. As such, the impact your cell phone payments will have on your credit scores depends not only if your cell phone providers report the payments, but whether it’s included in the credit scoring model.
Debt Collection
If you miss paying multiple cell phone payments, your cell phone provider may send your account to collections. This can damage your credit, as delinquent accounts can stay on your credit report for up to 7 years, even after they’ve been paid.
Prepaid Cell Phone Plans Vs. Postpaid Cell Phone Plans
Not all cell phone plans are reported to the credit bureaus. In general, prepaid cell phone plans have no impact on your credit, while postpaid plans can impact your credit. It’s important to understand the difference and choose the one that best suits your needs.
Prepaid Cell Phone Plan
Similar to a prepaid credit card, a prepaid cell phone plan allows you to load cash directly onto your account or buy “top-up” cards to pay your monthly bills. Since you’re technically buying your plan upfront, no credit check is required to activate your account, and your bills won’t appear on your credit report.
If you forget to load money onto your account, it will have no effect on your credit. You simply are able to use your cell phone until the funds have been used up.
Postpaid Cell Phone Plan
Postpaid phone plans are what most Canadian cell phone users have. Rather than depositing money in your account upfront, you agree to make monthly payments, typically by credit card (although other payment forms may be possible). Cell phone providers often perform a credit check when you apply for a plan.
Depending on the cell phone providers, postpaid cell phone payments may show up on your credit report, which may affect your credit score. As such, missing payments can hurt your credit, while timely payments will help your credit. To avoid any missed payments, setting up automatic payments is always a good idea.
Personal Information That Gets Reported To The Credit Bureaus
All cell phone companies have slightly different ways of reporting their customers’ accounts to Canada’s credit bureaus. However, there are several pieces of common personal information that every provider sends, including the following:
- Full Name
- Date of Birth
- Home Address
- Phone Number(s)
- Province/Territory
- Social Insurance Number (SIN)
Final Thoughts
Your timely cell phone bill payments can have a positive effect on your credit. This is particularly true if you have a postpaid plan, or you pay your bills with a credit card.
