You Asked a Good Question: Where Do Companies Report Business Credit?
So, seriously, where do companies report business credit?
Your best option as a small business owner is to keep on top of your company credit reports. These are from PAYDEX, Equifax, and Experian. Let’s break down specifics.
There are three big credit reporting agencies for small business. And you should check all three of them on a regular basis. This is because they use marginally different measurements. So moving the needle for one can move the needle for both of the others. But it’s perhaps not as much.
Do not let your business credit scores slide. This is because you should catch any mistakes fast as you can. And catch anything which is dragging your scores downward. And then afterwards take remedial measures.
You can get your reports conveniently and stay right on top of all three scores. Do this by following a few easy steps.
Is Your Score Any Good?
Does your business have a good company credit score?
So you are presently in business, and you are working hard to keep on top of your company credit scores. Or possibly you aren’t, and have determined now is a good time to start. Or maybe your business is somewhat new, and this is the very first time you’re doing this.
Whatever your conditions, you have most likely asked this question at least once. Are my scores any good?
Let’s have a look at the three business credit reporting bureaus.
Where Do Companies Report Business Credit? Dun & Bradstreet (PAYDEX)
Dun & Bradstreet’s PAYDEX score of your small business can wind up being among the major reasons that your company receives credit in any way.
D & B furnishes Credit Signal. So it is a way to keep an eye on your credit score by having the reports come directly to you, for a fee. You may discover the charge is well worth it. So this is in order to avoid the bothers that can stem from letting this score slip.
And you would not need to produce and stay on top of the organizing and reminders you might need to stay up to date with if you do not use it.
Don’t want to make use of Credit Signal? Not a problem, as you can get your PAYDEX report via D & B and, if needed, you can speak to their Customer Service department. So this department exists as a part of Dun & Bradstreet itself.
In addition, in order to review your PAYDEX report, check out what D & B provides, which is a specimen report and also some higher level advice in how you can decipher it.
Your Business’s PAYDEX Score
Dun & Bradstreet’s PAYDEX score ranges from 0 to 100. A PAYDEX score has a basis in payment information which is on report to the CRA. Or it is on report to data-gathering companies partnering with the CRA. D & B uses this information, in addition to a credit score and financial stress score, in order to advise the amount of credit a credit issuer should extend to your business.
Getting a PAYDEX Score
To get a PAYDEX score, you must file for a DUNS number by using Dun & Bradstreet’s web site. The number is free. Plus the CRA has to have records of your payments with four or more merchants.
Your business’s PAYDEX score reveals if your payments are usually made on time or ahead of schedule. As you might expect, a higher number is better.
PAYDEX Score Details
The scores break down as follows:
- 80-100: A low risk of late payments
- 50-79: A medium risk of late payments
- 49: A high risk of late payments
Business Credit Score
Your small business’s credit score runs from 1 to 5. 1 is the best score. This matches your business with other businesses with similar payment histories. The figure shows how often those small businesses tend to pay in a timely manner.
This data can really help credit issuers to comprehend your company’s standing.
But it does not genuinely show all of the payment information from your company.
Financial Stress Score
The financial stress score also ranges from 1 to 5. This score matches your company with other companies sharing comparable financial and business attributes.
These similarities are in areas such as size or amount of time in business. This score demonstrates how frequently those businesses tend to pay on time. As before, 1 is the best score. This rating is a broader evaluation of the business landscape, versus an analysis of your company’s authentic payment history.
A decent PAYDEX score for your small business is 80-100.
Where Do Companies Report Business Credit? Experian
Experian, another big credit reporting agency, also offers a way for obtaining reports sent to you for a cost. Therefore you can keep track of your Experian small business credit score here and the setup is easy.
But if you would rather not get continuing reports (and purchase them), then you can order a single Experian report for your business on their web site.
Also, if there are any problems or errors, you can challenge any problems on your small business’s Experian report. Do so if you follow the instructions on their web site.
Your Small Business’s Experian Company Credit Score
Experian’s Credit Score report includes things like a commercial credit score plus additional facts, including account histories, payment trends, and public records. Experian company credit scores run from 1 to 100.
Unlike Dun & Bradstreet’s PAYDEX score and Equifax’s payment index, Experian takes into consideration numerous factors, and not just payment histories.
Experian Scoring Factors
The elements which go into the calculation include:
- Lines of credit your business has an application for in the prior nine months
- New lines of credit you’ve begun in the past six months
- Your business’s years in business
- Payment history in the most recent twelve months
More Experian Scoring Factors
- Lines of credit in use in the past six months
- Collections amounts in the last seven years
- Percentage of available credit in use
- Amount of payments one – 30 days overdue, or 31 days or more overdue
- Amount of non-net-30 lines of credit (that means the payment is due in less or greater than 30 days).
Usually, even small businesses which use credit responsibly will get a medium-low risk rating. As you might expect, older small businesses will have an easier time acquiring a low-risk rating.
A good Experian score for your small business is 76-100.
Where Do Companies Report Business Credit? Equifax
Equifax, one of the large credit reporting bureaus, offers a risk monitoring service. So it is easier as it permits reports to go straight to you.
If you don’t wish to shell out money for continuing reports, you can instead request your small business’s Equifax report.
On top of that, if you have to dispute your company’s Equifax report, do so by adhering to the directions on their site.
And you can learn how to read through your Equifax report by taking a look at a sample of their reports.
Your Business’s Equifax Score
Equifax displays three distinct business determinations on its commercial credit reports. These are the Equifax payment index, your small business’s credit risk score, and its business failure score.
Equifax Payment Index
Similar to the PAYDEX score, Equifax’s payment index, which has its gauge on a scale of 100, demonstrates how many of your small business’s payments were made on time. These include both records from credit issuers and vendors.
But it’s not meant to anticipate future activity. That is what the other two scores are for.
Equifax Credit Risk Score
Equifax’s credit risk score checks how likely it is your small business will become severely delinquent on payments. Scores range from 101 to 992, and they measure:
- Available credit limit on revolving credit accounts, e. g. credit cards
- Your business size
- Evidence of any non-financial transactions (e. g. merchant invoices) which are delinquent or were on charge off for two or more billing cycles
- Amount of time since the opening of the oldest financial account
Equifax Business Failure Score
Finally, Equifax’s business failure score takes a look at the chance of your business closing. It ranges from 1,000 to 1,600, assessing these factors:
- Total balance to total current credit limit average utilization in the last three months
- How much time since the opening of the earliest financial account
- Your small business’s worst payment status on all trades in the past 24 months.
- Confirmation of any non-financial transactions (e. g. vendor invoices) which are delinquent or have been on charge off for two or more billing cycles.
Equifax Scoring Analysis
For the credit risk and the business failure scores, a score of 0 means bankruptcy.
A great Equifax score for your business is as follows:
- Payment Index 0-10
- Credit Risk score 892-992
- Business Failure score 1400-1600
Where Do Companies Report Business Credit? It Matters to YOU
In some cases, it pays to hand over a few bucks to get your small business credit reports routinely. It’s a lot more convenient than to have to always remember to do this and you’ll probably consider these reports more carefully. That is because they come with a price.
Continue to target and use the tools that these credit reporting bureaus offer. And make your life less complex. That’s because it is obvious. You’ve already got enough on your plate.
A result of the recent data breach, there are all the more reasons to evaluate your small business credit reports and your personal credit reports. So be vigilant about any errors you catch. Learn more here and get started in getting business credit reports, because you need to know the answer to the question: where do companies report business credit?