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Personal Credit vs Business Credit: What’s the Difference?

Reviewed by Ty Crandall

November 14, 2023
Business Credit Score VS Personal Credit Score Credit Suite

Consider your business credit scores vs personal credit scores. Let’s look at both.

Personal Credit Scores 

Personal credit scores come from TransUnion, Experian, and Equifax. They are based on a few factors: how timely you pay your bills, recent inquiries (AKA new credit), credit mix, credit history length, and utilization rate. Utilization rate is just total credit in use divided by total available credit. It’s a way of looking at amounts owed.

The Fair Credit Reporting Act protects consumers. In fact, it provides for an annual free copy of your personal credit reports.

Personal Credit Building is Intuitive

You probably didn’t feel the need to proactively build your personal credit. At least, not to get it started. You may have submitted an application at a store or gas station, or received an offer in the mail.

You did not need to get some number to get into any consumer credit bureaus. It just happened.

Also, virtually all merchants will report personal credit to one or more of the big three personal credit bureaus. This is the case whether you pay your bills on time, or you default. Not so with business credit.

Discover our Get Business Credit guide, with everything you need to know about building credit for your business.

A Look at Business Credit Scores

When you put them head to head and look at business credit score vs personal credit score, the way credit is built stands out.

With business credit, the three main business credit reporting agencies are Dun & Bradstreet, Experian, and Equifax (you can get to pages for business credit Experian and business credit Equifax from the same websites as the personal credit versions). And over nine out of ten vendors will not report to the business credit bureaus unless you default. 

Who reports business credit? Very few vendors. Vendors who report business credit are few and far between. However, nearly all of them are checking business credit reports to make their decisions—even if they don’t report your account to the business credit bureaus.

Business Credit Scoring Factors

While there’s more than one, the biggest one is all that really matters—whether you pay your invoices on time.

Keep Your Business Credit Separate From Your Personal Credit

Factoring in the difference between your business credit score versus personal credit score, remember that any inquiries into your personal credit score will adversely affect that score. A lot of merchants and lending institutions will make inquiries when doing business with you for the very first time. And you do not want their inquiries to impact your personal credit.

As a result, you need to keep business and personal credit separate. We have the best ways to make sure your business credit doesn’t report on your consumer credit reports. Read on for more.

Get a Dun & Bradstreet D-U-N-S number

Unlike with personal credit, you have to proactively get this. Why? Because D&B is the largest business credit report agency, so building business credit with them will help you in building with Equifax and Experian. But first you need a D-U-N-S number.

You can’t get into Dun & Bradstreet’s system without one, and they are free, anyway. A D-U-N-S number differentiates your small business from all others, including similarly-named companies. Dun & Bradstreet requires that you register your company on their website before they will hand over a D-U-N-S number.

Please note: there are a few marginally different methods of getting a DUNS if your business is in a certain class. These include if your business is an USA government contractor or grantee, or your company is in Canada, or you are doing work as an Apple developer.

Establish Your Company as a Distinct Legal Entity Through Incorporating

Get together with your tax consultant or financial planner so as to opt for which legal entity will best fit your small business and specific financial circumstances. These are sole proprietor, LLC or S-Corp. Also, partnership is possible if there is more than one owner.

Incorporation can also help to protect your personal assets in case of a law suit. Once your corporation or LLC is registered on your state’s Secretary of State’s website, you can then get a Business Federal Tax ID Number. And then you can open a business bank account, too.

Discover our Get Business Credit guide, with everything you need to know about building credit for your business.

Get an EIN

The IRS makes it easy to do this. Apply on the internet as soon as you ascertain your eligibility.

  • Is your main business located in the U.S. or in USA Territories?
  • Does the person who is applying have a valid Taxpayer Identification Number (SSN, EIN, or ITIN [Individual Taxpayer ID Number]?

If this is so, then you can go ahead.

Personal Credit Cards vs Business Credit Cards

When looking at personal credit vs business credit, it is inevitable to consider a business credit card. Differences abound, even if a business owner keeps a business credit card and a personal one from the same lender.

With a personal credit card, the credit limit is often lower. To get a personal credit card, usually there’s at least a soft pull. The credit card issuer or lender checks your personal credit report. 

With a hard pull, it affects your credit score. And, if you apply for a few personal credit cards at a time, it can lower your credit score. Not an issue with more than one business credit card.

With personal credit cards, utilization rate matters. If personal credit cards don’t have such high limits, using them for business expenses can harm your score—even a good credit score. 

With a personal credit card, credit mix affects scores. As does account age. Never close a personal credit card file, even if you prefer cash to a personal credit card from a lender or business credit card issuer. 

With a business card, it is often a charge card you must pay off in full every month.

With a business credit card, limits are higher. Putting business expenses on a corporate credit card is less of an issue. Your business credit card can still have perks like rewards or a statement credit.  

For a personal or business credit card, you might enjoy a limited time when there’s no assessed annual fee. And while payment history matters for both, it is a much bigger driver of business credit scores.

Another difference between a business and personal credit card is how quickly expenses hit your credit report. With a personal credit report, it’s several days. But for a business credit report, it can be faster. 

The Best Way to Separate Business Credit Score vs Personal Credit Score is to Build Business Credit

Of course the easiest and best way to separate business credit score vs personal credit score is to build credit for your business. Many of the above tips apply to building business credit. So here’s the rest of the means of business credit building.

The Process Truly Starts with Company Fundability™

A small business needs to be Fundable to lending institutions and merchants. That is why, a corporation will need a professional-looking website and email address, with website hosting from a hosting company. Company phone numbers need to have a listing on 411, which you can get on ListYourself.net.

Additionally the business telephone number should be toll-free (800 exchange or similar).

A small business will also need a bank account dedicated strictly to it, and it has to have all of the licenses essential for operating. These licenses all must be in the particular, appropriate name of the corporation, with the same small business address and phone numbers. Keep in mind that this means not just state licenses, but potentially also city licenses.

Trade Lines

First you should establish trade lines that report. This is also referred to as vendor accounts. Then you’ll have an established credit profile, and you’ll get a business credit score.

And with an established business credit profile and score you can start getting more credit.

These types of accounts tend to be for the things bought all the time, like gasoline, cleaning supplies, and office furniture.

But first off, what is trade credit? These trade lines are creditors who will give you starter credit when you have none now. Terms are typically Net 30, rather than revolving.

Therefore, if you get approval for $1,000 in vendor credit and use all of it, you will need to pay that money back in a set term, like within 30 days on a Net 30 account.


Net 30 accounts need to be paid in full within 30 days. And Net 60 accounts must be paid fully within 60 days. Compared to revolving accounts, you have a set time when you have to pay back what you borrowed or the credit you used.

To start your business credit profile properly, get approval for vendor accounts that report to the business credit report agencies. When that’s done, you can then use the credit.

Then pay back what you used, and the account is on report to Dun & Bradstreet, Experian, or Equifax.

We know which vendors will approve your business AND report to one or more of the big three CRAs: Dun & Bradstreet, Equifax, and Experian.

Monitor Your Business Credit

Know what is happening with your credit. Make certain it is being reported and take care of any errors as soon as possible. Get in the practice of checking credit reports. Dig into the details, not just the scores.

We can help you monitor business credit at Experian, Equifax, and D&B for a lot less than it would cost at the CRAs. Update the details if there are inaccuracies or the data is incomplete.

Fixing Errors

So, what’s all this monitoring for? It’s to dispute any inaccuracies in your records. Errors in your credit report(s) can be fixed. But the CRAs generally want you to dispute in a particular way.

Disputing credit report inaccuracies generally means you precisely spell out any charges you contest.

Discover our Get Business Credit guide, with everything you need to know about building credit for your business.

A Word about Building Business Credit

Always use credit sensibly! Don’t borrow more than what you can pay off. Monitor balances and deadlines for repayments. Paying off on schedule and completely will do more to raise business credit scores than almost anything else.

Establishing corporate credit pays. Good business credit scores help a corporation get loans. Your loan provider knows the small business can pay its debts. A small business’s EIN connects to high scores, and lenders might not feel the need to ask for a personal guarantee.

Business credit is an asset which can help your corporation for years to come.

Takeaways for Business Credit Score vs Personal Credit Score

A small business owner can build a good credit history whether with a small business credit card or a personal credit card. 

A business card is the best choice for covering business expenses or avoiding taking out a personal loan. A business credit card is best for setting a company up for a future small business loan. Or maybe a business line of credit.

Save your personal credit history and your own cash and personal card. Use a business card for better cash flow and start building good business credit with every business credit bureau and business credit card company. 

Bolster the professionalism of your company and keep your individual and company credit apart. 

About the author 

Janet Gershen-Siegel

Janet Gershen-Siegel is the seasoned Finance Writer and a former content manager at Credit Suite. She has been admitted to practice law for over 30 years, with a focus on litigation and product liability, and is a published author, with writing credits at Entrepreneur, FedSmith.com and BusinessingMag.com.

She has a BA in Philosophy from Boston University, a JD from the Delaware Law School of Widener University, and a MS in Interactive Media (Social Media) from Quinnipiac University.

She regularly writes for Credit Suite, which helps businesses improve Fundability™, build credit, and get approved for loans and credit lines.

Her specialties: business credit, business credit cards, business funding, crowdfunding, and law

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