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What is the Schufa actually?

What is SCHUFA

It plays a crucial role in the credit check and anyone who has a negative entry will find it very difficult to get a loan: The Schufa information. But who is the Schufa actually and what does the Schufa score say?

The "Protection Association for General Loan Assurance" - SCHUFA for short - is the largest credit agency in Germany. In addition to personal data, it collects and saves relevant information about accounts, current contracts, invoices and payment history from every German consumer with legal capacity. These are usually stored for three years. Using a specific algorithm, Schufa uses the available data to determine a value for each consumer, the so-called Schufa score, which predicts the creditworthiness or is an indication of the probability of default. The Schufa score corresponds to a value between 0 and 1,000, whereby a high value means very good creditworthiness and a low value means poor creditworthiness. About 65 million German citizens are recorded with the corresponding data at the Schufa.

Banks use the Schufa score for credit checks in order to be able to assess the creditworthiness, i.e. the ability to repay the loan as planned, as realistically as possible. The Schufa score influences the interest rate that a borrower gets at the bank. However, it is not alone decisive for the credit decision and the conditions. In traditional banks, for example, soft factors such as impression, personal trustworthiness or previous experience with the customer play a role that should not be underestimated.
If you don't know your Schufa score, you can even obtain a Schufa self-assessment once a year free of charge. The so-called "data overview according to § 34 BDSG" gives you information about all the data that Schufa has saved about you. You can simply request the self-assessment from Schufa using the completed order form. If you intend to apply for a loan in the near future, it is even advisable to find out your Schufa data beforehand. According to Section 35 of the Federal Data Protection Act (BDSG), you have the option of correcting outdated or incorrect information or having it blocked and thus preventing you from incorrectly receiving poorer credit terms. In order to cause a deletion or change of data, an informal letter to Schufa is sufficient, with the request and a brief explanation of the correct facts.

As a rule, banks always ask the potential customer's Schufa score when making a loan request. In the case of online loans , the Schufa information is sometimes even queried in real time during the online application process. The information that a customer has requested a loan from his bank is saved by Schufa as a "request credit condition". This does not affect the Schufa score.

With the so-called Swiss credit , no Schufa information is obtained. The Swiss credit is therefore an exception. In the case of Swiss credit, the creditworthiness of the applicant is determined as part of the credit check based on the information in the credit application and the salary statements. However, with a Swiss loan it cannot happen that the loan application is rejected just because you may have forgotten to pay your phone bill on time. As the name suggests, the Swiss loan is not granted by German credit institutions, but mostly by banks that are based in Switzerland.

My name is Quang Lam and I work at Hegner Möller GmbH as Marketing Director. I am very interested in finance and sports. In my free time I like to go running and I also run a running blog. For the Best Credit blog I only write about topics that really interest me.


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