85% of Brits Overestimate Credit Card Knowledge: Zable Study Reveals Major Financial Literacy Gap

New research from credit card provider Zable reveals that 85% of British consumers overestimate their understanding of credit products, creating a significant "confidence gap" in the UK lending market. This disparity between perceived and actual financial literacy suggests that millions of borrowers may be making critical financial decisions based on fundamental misconceptions about interest and credit scores.

What was announced

Zable conducted a comprehensive study involving 2,000 UK adults to measure the disparity between perceived and actual financial literacy regarding credit cards. The research focused on fundamental concepts, including Annual Percentage Rate (APR), interest calculation, credit score factors, and repayment regulations. While 85% of respondents expressed confidence in their understanding of credit cards, only 55% were able to accurately demonstrate that knowledge when tested.

The literacy gap was particularly pronounced in specific technical areas. For instance, while 68% of participants felt confident explaining APR, only 38% provided correct answers. Similarly, 78% believed they understood credit scores, yet only 51% could identify the factors that influence them. Overall, 39% of the surveyed population failed Zable’s 15-question literacy test, failing to answer at least half of the questions correctly. The average score recorded across the study was 8 out of 15.

Demographic data revealed a significant generational divide. Only 26% of respondents aged 18-24 passed the test, contrasted with a 74% pass rate among those aged 55 and over. Misconceptions remain prevalent across all age groups; only 29% of Brits understood that personal income is not a factor in credit score calculations. Furthermore, nearly a quarter (23%) of respondents incorrectly identified utilizing a full credit limit as an effective strategy for improving a credit score over time.

"For many Brits, using a credit card has become second nature, but understanding how it works is another matter. While credit cards can be a valuable financial tool for everyday spending, spreading costs, or managing emergencies, making informed decisions requires more than confidence alone. Clear, accessible guidance is essential to help consumers avoid costly mistakes and build stronger financial resilience."

James Goforth, Product Manager at Zable.

The companies involved

Zable is a UK-based credit card provider that positions itself as a technology-led alternative to traditional high-street banks. The company focuses on the credit card segment of the market, competing by offering digital-first management tools and transparent fee structures designed to help consumers manage their borrowing more effectively. Its approach is rooted in using data to provide clearer insights into consumer behavior and credit health.

The firm operates within the same fintech ecosystem as Lendable, a major player in the UK consumer credit market. Lendable was founded by Martin Kissinger, who serves as CEO, alongside Jakob Schwarz and Victoria van Lennep. Lendable has established itself as a significant force in the lending sector, utilizing automated underwriting and proprietary risk assessment technology to provide personal loans. Both entities represent a shift in the UK market toward "second wave" fintechs that manage complex balance-sheet lending rather than just payment processing. By leveraging technology to assess risk and provide credit, these companies aim to offer more personalized and accessible financial products than legacy institutions, particularly for consumers who may be underserved by traditional banking models.

What FF News has reported before

FF News has closely tracked Zable’s ongoing efforts to highlight the challenges facing UK consumers in the credit market. In September 2026, we covered a report titled One in Three Young Brits Turn to Social Media for Financial Advice, Zable Study Finds, which explored how younger generations are bypassing traditional financial institutions in favor of unverified digital platforms. This followed an earlier investigation in August 2026, where a Zable Study Reveals 70% of Brits Hold Costly Credit Card Misconceptions, specifically regarding how interest is applied to balances. These reports collectively suggest a persistent trend of low financial literacy that Zable has been documenting throughout the year. Our coverage of the wider sector also includes developments in credit accessibility, such as when Abound Partners with D•One to Expand Open Banking Credit Access for 3.5 Million Users, highlighting the industry's shift toward more granular data usage to bridge the gap between consumer needs and credit availability.

What this means

The "confidence-competence gap" identified in this research poses a systemic risk to the UK credit industry. When 85% of consumers believe they understand products they are actually misusing, the likelihood of "accidental" delinquency and long-term debt traps increases. This puts significant pressure on lenders to move beyond the "clear and prominent" disclosure requirements of the FCA’s Consumer Duty and toward active verification of customer understanding. The industry is currently at a crossroads: firms that rely on consumer ignorance for fee income face mounting regulatory and reputational risks. Conversely, those that successfully bridge the education gap may find themselves with a more resilient, loyal, and lower-risk book of business in an increasingly scrutinized market.