Credit Entry

A credit entry is a financial contribution to a bank account, credit account, or any kind of online wallet. Established credit reporting agencies taking note of certain financial behaviors are also considered credit entries. 

What Is a Credit Entry? 

There are generally two different kinds of credit entries. The first is when money enters any one of your financial accounts. The second is when any one of the major credit reporting bureaus collects data regarding your financial history. 

Depending on how you handle your finances, you may have a significant amount of credit entries that could end up benefiting your overall financial situation. 

Credit Entry vs. Debit Entry 

Purchases and transactions are considered either debit or credit depending on where money is going in relation to your account. A credit entry is a notation of money entering your account, and a debit entry is a notation of money leaving your account. On your bank account history, you can view exactly which transactions were credit entries and which ones were debit entries. 

A few examples of credit entries into your bank account, credit card account, or another banking app would be: 

  • Receiving a paycheck or scheduled payment from a job or employment 
  • Getting your money back after making a return on a purchase 
  • Reimbursement from a deal on certain goods and services 

Typically, workers are paid by their employers on a weekly, bi-weekly, or sometimes monthly basis. Every time you receive a paycheck via direct deposit, the depositing of that money is considered a credit entry. 

Have you ever bought something and ended up returning it? When you return an item to a store, the cashier usually requires the exact card used to purchase the item, assuming you paid via card and not cash. This requirement is so the store can properly credit your account and complete the return transaction. When you go through the return process, it can take anywhere from several business days to a week for you to see the credit entry in your account. 

Another type of credit entry are reimbursements from advertising deals and promotions. Sometimes companies will offer products that come with a rebate, or reimbursement policy. With these kinds of credit entries, you pay money upfront and then receive it back after a certain period of time. Companies and businesses offer rebates and reimbursements as incentives to purchase their specific goods or services. 

A debit entry, on the other hand, is the exact opposite of a credit entry. Any time you purchase something or withdraw money from your bank account, you’ll see an associated debit entry in your banking history. From your bank account you can authorize debit entries via your debit card. If you have a credit account, you can also authorize debit entries via your credit card. However, to avoid overspending, keep tabs on your credit or debit limits and stay within your financial means. 

Credit Entries From a Credit Bureau 

Credit entries from a credit bureau are the factors that help determine your credit score. There are 5 major factors that contribute to credit scores. They are: 

  • Payment history
  • Length of credit 
  • Credit mix 
  • Amount of debt
  • New credit types 

There are also 3 major credit reporting agencies that gather credit entries. They are: 

  • Equifax
  • Experian
  • TransUnion 

With credit reporting agencies, there can be both positive and negative credit entries. A positive credit entry would be actions like making a loan payment on time, completely paying off a loan or bill, or establishing a long and healthy credit history. Positive credit entries have the ability to improve your credit score. 

A negative credit entry would be an action like missing repeated loan payments, totally defaulting on a loan, declaring bankruptcy, applying for too many types of loans and getting denied, or accumulating too much debt. Too many negative credit entries may result in a significant decrease in a credit score, which can financially hold you back in the future. 

When people don’t have a lot of negative credit entries on their credit report, they tend to have improved scores. When someone has a higher credit score, they usually have an easier time finding great deals on loans, mortgages, and other financial endeavors. 

How Can I Benefit from a Credit Entry? 

Both types of credit entries can come with great benefits to take advantage of. First, A credit entry in your bank account means you have more money, which anybody would enjoy. To keep your finances organized, stay on top of your scheduled credit entries so you’re always aware of how much money you currently have. 

If you’re unsure of how much money you have in your bank account, you run the risk of overspending and overdrawing your account. If you overdraw an account too much, you may even go into the negatives which can come with a series of unwanted penalties and fees. To utilize your credit entries as much as possible, check in with your bank account often and stay familiar with your current balances. 

Second, a positive credit entry from any one of the major credit reporting agencies can lead to a higher credit score over time. For example, if you currently have an online installment loan and are making consistently monthly payments, you’ll eventually pay back your loan entirely. In these circumstances, there are two different areas of your credit score that could benefit. Having a positive payment history and avoiding delinquent/missing payments, as well as paying off a loan will contribute positively to your credit score and credit history.

Resources

  1. Top 3 Credit Bureaus

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