Frequently Asked Questions (FAQ)

Do I need a business credit score?
Yes, you need to establish a business credit score and monitor it regularly. Even if you don’t plan on applying for funding anytime soon, landlords, insurance companies, vendors, and suppliers might also be interested in your business credit score. Like the PAYDEX score, certain business credit scores show how timely your business is with payments.
Why do I need to monitor my business credit score?
Monitoring your business credit score is a good practice, especially since credit scores for businesses are available to the public (unlike a personal credit score). Monitoring it will help you track how other businesses see your creditworthiness and risk. Plus, inaccurate information can be there, which you would only know about via monitoring. Monitoring could also help you identify a case of fraud more quickly.
What is business credit used for?

Your score is used for determining your borrowing power, including funding and credit lines. It’s also the determining factor for the interest rates lenders offer you regarding commercial insurance, credit lines, business loans, etc. The more favorable your score is, the more likely your business will receive favorable payment terms.

Is a business credit score different from a personal credit score?
Yes, to begin with, personal credit scores are tied to your social security number, and business scores are tied to the Tax ID Number. Personal scores are established through Experian, Equifax, and TransUnion, whereas business scores include information from Dun & Bradstreet. 
What is considered a good business credit score?
Each reporting bureau uses its own unique scoring system to assign a business credit score. To understand what makes a good score, you should review each agency’s scoring methodology. For example, the Dun & Bradstreet rating system and the PAYDEX score use a scale system ranging from 0 to 100. A score of 80 indicates that your business makes timely payments.

About the Authors

Sara Coleman

Written by: Sara Coleman

Freelance Financial Writer

Sara Coleman is a freelance writer with several years of experience covering personal finance topics such as insurance, loans, credit cards, budgeting and more.

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Kal Salem

Reviewed by: Kal Salem

CPA, PMP and Finance Consultant

A CPA and finance professional working with small businesses to educate owners and grow alongside their businesses. He holds a Masters in Accounting and a BS in Supply Chain Management. Owner at Salem CPA Services LLC.

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Somer G. Anderson, Ph.D.

Fact checked by: Somer G. Anderson Ph.D., CPA

Student Loan Expert

Somer G. Anderson has been working in the Accounting and Finance industries for over 20 years as a financial statement auditor, a finance manager in a large healthcare organization, and a Finance and Accounting professor at Maryville University.

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