Business Credit Score:
How to Check it
There are plenty of major online credit agencies, but the biggest and most well-known name in the industry is Dun & Bradstreet.
Other commonly used agencies include Experian and Equifax. However, each agency charges for producing a credit report and goes about collecting information and analyzing it differently. These differences can lead to much different outcomes.
This is the main reason behind why scores from each company could end up drastically different.
3 Major Options
Dun & Bradstreet has a $61.99 fee for a report. Along with a credit summary and credit risk score, they also provide a PAYDEX score, a financial stress score and industry payment benchmarks. This is quite a bit different than the next two options
Equifax has a $99.99 fee and includes public records and a business failure score.
Experian charges a mere $36.95, but only provides basic information and is not very comprehensive.
While each bureau has different methods and different interpretations of scores, the major agencies use a 1 to 100 scale. Typically, a score over 75 or 80 means good credit, and in turn, is a low risk borrower. These borrowers tend to pay their debt on time or early.
One of the first things you should do when you receive your report is to check for accuracy. When you receive your credit report, it’s important to review the data and make sure everything collected about your business is truthful and that there are no inconsistencies. Clearing up any potential wrongful reports could be the difference between an excellent credit score and a poor one.
Additionally, it’s a good idea to get a DUNs number. This number lists you in the Dun & Bradstreet company database and sets up a credit file for you.
If you’re the owner of a new business, setting up a DUNs number will get you on the path to establish good and accurate credit early. The best part about this is that it’s free to apply for a nine-digit number. Some institutions actually require a DUNs number before working with a business or vendor, so you may need to get a DUN
Finally, when interpreting your score, you should know that not all reporting agencies report on a 1-100 scale:
For example, FICO has a Small Business Scoring Service that ranges from 0-300 (the higher the better).
The key take away here is that knowing your business credit score is important, and there are many ways to find this information out. However, you should pay close attention to where you are getting your business score from and know the ranges and reasons behind the score. Nothing is worse than thinking you have a stellar credit score, only to find out that there was actually incorrect information reported against your company and, in turn, losing out on financing for a major business project.