AN estimated 600,000 people are potentially damaging their credit rating each year by being turned down for financial products they have applied for online, it is feared.

About 52,000 online applications for loans, mortgages and credit cards are rejected each month - generally because people were applying for products that were either unsuitable for them or unavailable to them.

This is potentially damaging their credit rating as these refusals would be recorded - making it harder for them to take out products in the future, warns MoneyExpert.com

"Switching financial products and providers is becoming ever more popular as people are encouraged to save money and look for lower interest rates," said MoneyExpert chief executive Sean Gardner.

"'But there are pitfalls - people often see a headline-grabbing rate advertised by a provider and apply without giving enough consideration to their needs, personal circumstances and credit ratings.

"When you consider many financial institutions offer best rates only to customers who meet certain criteria - which much of the time includes having a high credit score - it is not surprising many people are turned down."

Some people would be offered a higher rate, but others were declined completely, he added.

First published: November 1