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5 Ways To Improve Business Credit Score


Running a business will require you to consider various considerations, including your business credit score. Your corporate credit score plays an essential role in the holistic financial outlook of your company. Finding ways to improve your company’s credit standing may appear to be a daunting task, but it's a critical step toward your firm’s eventual financial success.

A Closer Look At Business Credit

If you have good business credit, consider it one of your best assets as an entrepreneur. The company credit score, dependent on your organization’s debt history, credit, and payment history measures your organization’s creditworthiness. The score tells vendors, lenders, and other lending institutions whether your enterprise is dependable when paying its bills and fulfilling its debts.

When you have a favorable business credit score, it's more likely for you to gain approval for business-type loans with favorable terms such as enticing interests, longer repayment terms, and bigger credit lines. 

Ways To Boost Your Company's Credit Score

One of the main reasons for improving your business’s credit is that it can affect the financing opportunities your business can secure. A high credit score allows you to borrow more money for your ventures, whereas a low score prevents you from enjoying business-friendly loan terms. 

Luckily, if you have a mediocre business credit report, there are ways to improve it. Here are some of the ways to improve your business credit score. 

  1. Consider Utilizing Net 30 Accounts  

Net 30 accounts may be an option worth considering to improve your business credit score. Generally, these accounts give you 30 days to pay the bill in full after a purchase. In simple terms, it's a way to buy now and pay later.  

If you want to establish your business credit, consider checking out the net 30 accounts as a good start. Generally, it's a trade credit that vendors and suppliers extend to businesses. In these terms, a company will receive an invoice upon purchasing products or services and will have 30 days to pay the bill. Make timely payment a priority to help your company build its credit history and improve its overall business credit scores.

  1. Scrutinize Your Credit Report  

Make it a priority to obtain your business credit report from major credit reporting companies. Although these reports aren’t free, they're the first step toward improving your credit score.

Once you know your score, you can work with it to gather all of the information you need to improve it in a bid to build business credit favorably. Further, you can identify which accounts have a negative impact on your report and any disputable items you can raise concerns about.

  1. Always Pay All Company Bills And Other Obligations On Time  

One of the straightforward ways to boost your credit score is to make timely payments to vendors, lenders, landlords, and utility companies, to name a few. 

Generally, it may require you to prepare ahead of time but ensuring you can pay for everything, including business credit cards, even in a day or two, can help improve your credit score.  

Using a spreadsheet to monitor all your accounts payable and configuring automatic online payments for recurring costs such as monthly debt repayments and utility bills are two helpful hints to help you manage your payments on time.

  1. Update Your Business Information With The Top Credit Reporting Bureaus

The main credit bureaus utilize distinct formulas when coming up with business credit scores. Suppliers and creditors also report credit details to multiple bureaus. With this in mind, prioritize updating your business credit file with all of the top credit reporting bureaus.

Go directly to each company’s website and review each one’s rules regarding business credit creation or maintenance. You can check out your file, send out the latest financial information, or scrutinize your corporate credit document for anomalies or inaccurate data. Once you find any incongruences, send a report right away to the concerned entity. If you make it a priority to keep your corporate credit records accurate, clean, and updated, it can help you build business credit favorably.

  1. Uphold A Minimal Credit Utilization Ratio 

The credit utilization ratio is the credit figure you use compared to the amount of credit available to you. Credit reporting bureaus generally see in a more positive light lower credit utilization ratios because they indicate that you're not using all of your credit.


Some of the ways to cut down on your credit utilization ratio include: 

  • Make an effort to eliminate your balances as much as possible. Paying off your balances regularly will help lower your credit utilization ratio. 

  • Ask for a credit limit increase from your credit card company. If you have a higher limit without increasing your balance, it decreases your credit utilization ratio. 

  • Avail yourself of a new line of credit but avoid using it. Doing so will increase the amount of credit available to you.

  • Make multiple, small payments throughout the month to keep your balance at a minimum. 

In most circumstances, the ideal credit utilization ratio is 30%, but a preferable one would be around 10%. 

Final Thoughts 

Whether your company is in its initial phase or it has been already established in the scene for years, make it a priority to maintain a good business credit score. By considering the valuable pointers on improving your credit score mentioned above, you'll be in a better position to gain favorable funding options and terms for furthering business and operations growth.

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