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While you may think credit scores are reserved for individuals, businesses also receive that ever important number.
Similar to personal credit scores, business credit scores play a part in how lenders judge your business's eligibility for credit products, such as loans and credit cards. If you're a small business owner applying for credit, it's important to understand what makes up your business credit score and how you can access your business credit report.
Below, CNBC Select reviews common questions surrounding business credit scores and credit reports, so you can familiarize yourself with your company's credit standing.
A business credit report is an aggregate of your business's credit history. This is similar to a personal credit report, which is a snapshot of your personal credit use. Lenders use information found in your credit report to judge whether you can repay credit extended to you.
Here's the typical information found in a business credit report, according to the Small Business Association (SBA):
- Company information including number of employees, sales, ownership and subsidiaries
- Historical data of the business
- Business registration details
- Government activity summary
- Business operational data
- Industry classification and data
- Public filings, such as liens, judgments and UCC filings
- Past payment history and collections
- Number of accounts reporting and details
Information in your business credit report impacts numerous financial decisions, which the SBA also provides:
- How much business credit a supplier will extend to you
- What repayment terms you'll receive
- What interest rates you'll pay
- How much credit or funding a bank or lender will extend to you
- How your customers view your business
- What insurance premiums you'll pay
A business credit score considers many of the same factors as a personal credit score, such as payment history and amount of debt used. However business credit scores use different scoring models.
For two main types of business credit scores, Dun & Bradstreet PAYDEX Score and Experian Intelliscore Plus, scores range from 1 to 100, and the closer to 100, the better. Consumer FICO scores, on the other hand, are ranked 300 to 850, with 800 and above being consider excellent credit.
Business credit scoring models weigh different factors when calculating scores, but you can anticipate that your payment history, age of accounts and amount of debt will be considered. If you carry a balance on The Blue Business® Plus Credit Card from American Express, that will be factored into your business credit score. And if you miss a payment on your Ink Business Cash® Credit Card, that can negatively impact your score.
While there are dozens of free credit score and free credit report resources available for consumers, it gets tricky when you look for business versions. There are select free business credit score resources available, but you may not get the full picture compared to a service that requires you to pay.
To make things easier for busy business owners, we've rounded up the popular free credit report resources and summarized what they offer. We've also included some of the other services that cost money but can be worth the money if you're looking for a comprehensive view of your business's financial standing.
- Alerts when your D&B credit scores and ratings change
- Monthly summary of activity in your business credit file
- Learn how often your business credit file is being accessed
What's missing: You won't have access to your full Dun & Bradstreet business credit report and credit score with the free version. If you want full access, consider upgrading to CreditBuilder Plus for $149 per month, which is the cheapest subscription option. CreditBuilder Plus includes everything from CreditSignal as well as an expedited Dun & Bradstreet D-U-N-S Number and D&B credit file. Compare Dun & Bradstreet products.
- Get a summary of your Dun & Bradstreet, Experian and Equifax business credit report
- Receive business credit grades for each score, plus your personal Experian credit score
- Tools to help you build business credit
What's missing: You don't receive your full business credit reports and scores with the free version. But you can upgrade to a paid version, starting at $29.99 per month for Nav Business Manager, to receive your full report and score with Dun & Bradstreet, Experian and Equifax, plus the ability to dispute errors on business credit reports and more. Compare Nav business credit products. There are alternative paid options to view your actual score, which we break down below.
- View your Experian business credit score
- Alerts when your Experian credit file changes
- Learn what factors affect your business credit score
The cost: Experian offers four different business credit report products. One-time access starts at $39.95 for a CreditScore Report and goes up to $49.95 for a ProfilePlus Report. An annual plan costs $179 per year for Business CreditAdvantage, and there's a premium version, the Business CreditScore Pro, which costs $249 per month. Compare Experian's business credit reports.
Update April 2, 2020: Experian is offering all American-owned small businesses free access to their business credit report through May 1, 2020. Learn more here.
- Access your Equifax risk scores — Equifax Business Credit Risk Score and Equifax Business Failure Score
- Receive a synopsis of your business's credit accounts with banks, suppliers and service providers
- Identify potential risk of late payments and business failure with Equifax risk scores
The cost: You can order one business credit report for $99.95 or a multi-pack of five for $399.95. Compare Equifax's business credit reports.
Additional business resources:
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