Business Credit Scores

Having a good business credit score is one of the most essential aspects to building a successful business. Keeping on top of your business credit score can improve your chances of getting trade credit and financing.

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What is a Business Credit Score?

A company’s credit score can determine whether it can get financing—including bank loans, cash advances, lines of credit, and credit cards—to enable vital business activities such as payroll, equipment upgrades, and business expansion.

Business owners who check their company’s credit score details regularly are more likely to have a better understanding of their business’s finances. Tillful’s free business credit score gives you an overview of the factors affecting your company’s credit options and overall financial stability. If you’re a small business owner, you understand the need for funding options when it comes to lenders. Our free business credit app not only allows you to check company credit score details in real-time but also matches you with credit options best suited to your business’ needs. Our wide selection of lending partners is tailored to the details of your business credit check, giving you ample opportunity to connect with potential funders who are rooting for your growth.

What’s a Good Business Credit Score?

Business credit scores range from zero to 100, with most lenders requiring a minimum business credit score of 75. The Small Business Administration (SBA), potential lenders, and your suppliers rely heavily on your business credit score when extending lines of credit and determining payment terms. Having a strong and healthy business credit score can help you in obtaining financing and on more favorable terms.

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Your Free Business Credit Score

Take control of your business credit today with Tillful and get access to:

  • Free business credit score updated daily
  • Free credit improvement tips to improve your business’s credit profile
  • Bank-level security with 256-bit encryption
  • Pre-qualified financing offers

Don’t forget, checking your Tillfull Credit Score never hurts your credit rating.

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How Are Business Credit Scores Used?

Your business credit score is a key factor lenders use to determine how likely you are to pay back credit. Business credit scores help:

Determine your borrowing power.

Your business credit report and score can determine how much financing you are able to secure.

Determine your rates on business insurance.

Some insurance providers evaluate a business owner’s credit as well as the business’s credit to determine rates on commercial insurance.

Get more time to pay.

Vendors and suppliers may look at a business’s credit reports or scores to decide how long to give the business before payment is due for goods and services.

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Different Business Credit Scores & Reporting Bureaus

Access to credit is directly affected by business credit scores, and three credit reporting agencies — Dun & Bradstreet, Experian, and Equifax — are responsible for most traditional credit reporting.

The Dun & Bradstreet PAYDEX score is a 1-100 rating based on a company’s payment history, with higher ratings going to companies that pay bills early. In addition to PAYDEX, D&B offers multiple other metrics to evaluate a company’s financial health as part of their business credit reports.

Experian’s Intelliscore Plus uses a 1-100 rating derived from the number and status of a company’s commercial accounts as well as how long they’ve had a file in Experian’s database. A financial stability risk rating is included with the credit score in Experian’s basic credit reports.

Equifax uses similar data as Experian to calculate a Business Credit Risk Score that ranges from 101 to 992. Their credit reports also include a Business Failure Score that predicts the likelihood that a company will file for bankruptcy in the next year.

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Equifax uses similar data as Experian to calculate a Business Credit Risk Score that ranges from 101 to 992. Their credit reports also include a Business Failure Score that predicts the likelihood that a company will file for bankruptcy in the next year.

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What Factors Determine a Business Credit Score?

Different credit scoring models calculate credit scores differently, based on a variety of factors. For example, Experian Intelliscore Plus is calculated using factors such as the following:

  • Business industry
  • Company's size and age
  • Credit utilization
  • Payment history
  • Derogatory items
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Separating Your Personal Credit Profile From Your Business Credit Score.

Keeping your business credit separate from your personal credit can not only help protect your personal credit, but can also help you secure financing for your business, obtain better trade credit terms with suppliers, and more. Despite how difficult it can be for small business owners, it’s essential to keep your personal and business finances separate.
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How to Improve Your Business Credit Score

If you’re a small company owner in the US, the simple act of finding a way to keep track of your business credit score is an excellent place to start. Here are a few key recommendations to improve your business credit score:

  • Check your business (and personal) credit
  • Separate business and personal finances
  • Establish your business credit
  • Pay your vendors and bills early
  • Use your business credit to manage your cash flow
  • Monitor your business credit reports
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What to be Aware of with Traditional Business Credit Scores

While traditional business credit reports contain valuable information, they sometimes contain out of date or incomplete information. By regularly checking in on your credit reports, you may be able to proactively fix these errors, which may boost your business credit score. Watch out for these factors:

Incorrect or outdated information: Details of some business-to-business transactions, known as trade references, get reported to the credit agencies, but those reports can sometimes contain errors that become part of a company’s credit file. Make sure you keep on top of errors, and dispute them if you see them.

Missing tradelines: The big credit agencies often only receive trade references from a small list of companies, meaning that a lot of B2B activity never gets recorded in their database. If you notice that tradelines are missing from your report, try to get those accounts to start reporting.

Limited records if you're a young company: If your business is early-stage, you may either have no business credit record (no-file), or limited information on your business credit report (thin-file). If you notice that your file is looking sparse and dragging down your score, think about opening store accounts (like with Sam's Club) or a business credit card.

How is the Tillful Business Credit Score Different?

The Tillful Business Credit Score is based on real-time transaction data from bank and credit card accounts. We apply our machine learning based credit model to find patterns from cash flow data in order to accurately assess business credit scores. In addition to traditional factors, such as payment history, these cash flow patterns could include:

  • Increasing or decreasing trend in your cash balance
  • Irregularities in inflow and outflow
  • Credit utilization trends
  • Usage of overdraft facilities
  • Payment delinquency
  • And other factors
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Three Key Reasons to Check Your Business Credit Score

The use of the traditional business credit scores is so commonplace that many people don’t stop to question how effectively they identify a company’s true credit risk. While traditional business credit reports contain valuable information, they suffer from several shortcomings. Here’s how a Tillful Score can help:

Know what lenders look for: While every lender is a little different, our credit model can help you determine whether you will qualify for a credit product before you apply.

Know what is behind your number: We share the top factors that impact your score. You can focus your efforts where it counts and tape immediate steps to improve your credit profile.

Build strong credit and financial health: With our alternative credit scoring resource, you get unfettered access to your credit score any time, along with email notifications when your score changes.

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