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Just like a consumer with a mortgage or a wallet full of plastic, companies that borrow money have their own credit history. And that history matters. A company's track record with credit—spelled out in detail on a credit report— can have a huge impact on its ability to borrow more money. Just as important, a company's credit history sends a strong message to potential partners and suppliers. A good credit report suggests that a company will likely meet its obligations and pay its debts in a timely manner—the type of company that others want to do business with.

Business Credit Report Breakdown

The three major credit-reporting bureaus — Dun & Bradstreet, Experian, and Equifax — collect information about how promptly your company pays its bills, plus lots of other financial data, and compiles it all in a credit report. Banks and other lenders check your business credit report before offering credit to your company, so it's essential to understand what your report says and make sure it's correct. Each bureau organizes its credit reports differently, but they all focus on the same types of information. Here's what to look for:

  • Credit score
    This numerical rating gives a quick snapshot of the creditworthiness of your company. Each bureau has its own proprietary formula for calculating this score.

  • Company information
    The report lists basic information on your company, such as its name, address and phone number. The type of business (corporation, LLC, etc.), parent company and subsidiaries may also be included.

  • SIC or NAICS industry code
    A company in a high-risk industry, such as a restaurant or real estate firm, may be less likely to get credit on favorable terms than one in a low-risk industry.

  • Company age
    The longer a company has been in existence, the more stable it is perceived to be.

  • Payment history
    This shows how many of your company's payments are made on time or late - and how late. Payment trends over time can indicate whether your company is growing and prospering or heading toward trouble.

  • UCC filings
    Any loan secured by collateral must be reported under the Uniform Commercial Code, preventing the same collateral from being used for another loan. Any liens against your company's property or assets will be listed. Some lenders neglect to update the UCC filing after a loan is paid off, so make sure this section is up to date. Otherwise, your business could look more financially overextended than it really is.

  • Legal issues
    Any lawsuits or court judgments against your company will be noted.

  • Collections
    Has another company initiated collections proceedings against yours? It could make your company look unreliable to potential lenders or business partners. If your business has become more solvent since going to collections, be sure to make all payments on time to repair your credit history.

  • Bankruptcy
    If you've had a bankruptcy in the last three years, it will be difficult for your business to obtain financing. One tactic for rebuilding your business's credit history is to get a retail credit card from a national chain, such as OfficeMax, and pay it promptly.

What Is a Business Credit Score?

Just about everyone knows their personal credit score and what it means. Your business credit score is a bit more complicated. While the personal credit rating agencies use the same scale (300 to 850, with anything higher than 700 being a great credit score), each of the business credit bureaus has its own scale. These are based on different types of information and calculated according to each bureau's own proprietary algorithm. Here's a quick breakdown:

Dun & Bradstreet PAYDEX Score (1 to 100)

This shows whether your company has paid its bills on time over the past 24 months. A higher score indicates a better track record of payment and a lower risk to creditors.

Score Range
Risk Class
Risk Description



Low Risk



Medium Risk



High Risk

Experian Intelliscore Plus

This "blended" score incorporates data from your business and personal credit histories to evaluate the chances that your company will become delinquent in the next 12 months. The Experian score reflects information from public records, collection agencies, legal filings, your company's payment history and how it compares to others in the industry. Higher scores indicate a better outlook:

Score Range
Risk Class
Risk Description



Low Risk



Low to Medium Risk



Medium Risk



High to Medium Risk



High Risk


Equifax takes into account your company's payment history, public records, and business demographics, as well as the small business owner's personal credit, in order to arrive at three separate scores:

  • Payment Index (0 to 100)
    Reflects your company's payment history to previous creditors. A score of 90 or higher indicates that your company has generally paid its bills on time.

  • Credit Risk Score (101 to 992)
    Indicates the likelihood that your company will become delinquent in the next 12 months, with a higher score meaning a lower risk to creditors.

  • Business Failure Score (1,000 to 1,880)
    Evaluates the risk that your company will go out of business in the next 12 months, with higher scores indicating lower risk.

How A Credit Check Can Help Your Business

Business credit bureaus calculate a score based on your history of repaying your debts. There are a number of perks that come with a high score:

  • more favorable financing terms
  • better lease arrangements
  • the possibility of bigger loans or credit limits to fund your business's growth

A good score also boosts your company's image and credibility in the business community. In business, few things are more valuable than your reputation.

Doing Your Due Diligence

A business credit report helps potential partners determine the financial risk of doing business with your company. Among other things, it addresses the big questions:"Can your business pay its bills on time? Can it pay off its debt? Can it pay suppliers by the agreed-upon deadlines? Are there looming regulatory or legal threats to your business's operation?" Since more than 85 U.S. companies filed for commercial bankruptcy each business day in 2018, small wonder that lenders and potential partners look to your business credit report for assurance that you can stay afloat. Do your due diligence and pull the credit reports.

Business Credit vs Personal Credit

How are business credit and credit scores different from personal credit and credit scores (such as a personal credit card and credit report)? Let's take a look.

  • creditCard1 icon

    Businesses have more credit capacity

    In fact, businesses have 10 to 100 times greater credit capacity compared to personal credit, according to the Small Business Administration. A good business credit score means a business owner can rely less on his or her assets and more on business loans and credit to fund the company.

  • creditDenied icon

    Business credit bureaus are not synched

    While the three consumer credit bureaus use the same kind of data to assign credit scores to individual consumers, the three business credit bureaus each depend on their own data and scoring systems.

  • creditCard2 icon

    Business credit reports are available to the (paying) public

    Personal credit reports are private—another layperson couldn't just gain access to your personal credit report. When it comes to business credit, however, your report isn't private. Anyone willing to pay for it can see your company's information.

    A business credit report involves data associated with your company, such as:

    • Company size, address and other demographic information
    • Its tax identification number and other regulatory data
    • Its business credit score, which is typically graded on a scale of 0 to 100
    • Its credit utilization ratio and total available credit
    • Its payment history, balances outstanding and missed or delinquent payments
    • Its loans in collection
    • Trade data
    • SIC code and UCC filings
    • Bankruptcies, IRS tax liens and other legal judgments
    • Derogatory information

The Three Major Business Credit Bureaus

The three major business credit bureaus are Dun & Bradstreet (D&B), Experian and Equifax.


Dun & Bradstreet (D & B)

Unlike Experian and Equifax, which also offer personal credit reports, D&B focuses exclusively on business credit and its PAYDEX 100-point score system assigns an 80 or higher rating to companies with excellent financial health—which means they pay lenders and suppliers earlier than payment is due. To establish a PAYDEX account, you'll need to:

  1. Obtain a DUNS number from Dun & Bradstreet
  2. Register your business with Dun & Bradstreet
  3. Open at least four trade accounts, the minimum number D&B requires for a PAYDEX score

PAYDEX scoring is exclusive to D&B.



Equifax has three types of scores to offer a business. The Equifax payment index, also measured on a scale 1 to 100, calibrates your business's reliability by looking at your history of on-time payments (but not early payments). Equifax also offers a business failure score (scores between 1,000 and 1,080) that — you guessed it — estimates how likely your business is to fail. Its credit risk score (101-992) judges how likely your business is to become late on payments in the future.



Experian also provides a credit score 1 through 100 for businesses, but looks at more than your payment history for its estimation. It also factors in information based on a series of questions about your business, including how much credit you've used and applied for recently.

Ensuring Accuracy

According to a Wall Street Journal study, just one-third of small business owners checked their business credit report during their previous two years of operation. Of the firm owners who checked their reports, nearly one quarter said they found errors or missing data that put their business in a riskier (and more expensive) category.

This underscores the importance of an accurate business credit report. You can contact a reporting agency to fix errors—each credit bureau has its own process for doing so.. (This information can be found online on a reporting agency's website.)

Be prepared to send any supporting documentation that validates your claims. For a fee, you can also subscribe to monitoring services that alert you to changes in your business credit report.

Get Rewarded for Paying On Time

When it comes to business credit reporting, any information submitted from outside parties is voluntary. That means if a vendor does not report your (good) transactions to the credit bureaus, you don't get the benefit of a potentially higher score.

For this reason, look for lenders and suppliers that will report your timely payments. Some don't, so choose vendors who routinely send such information to credit bureaus. Being able to take credit for your responsibility will help to build your business credit profile and increase your credit score. Equifax's payment index and D&B's PAYDEX score rely on on-time payments.

How to Look Up Other Businesses' and Vendors' Credit Scores

Checking another company's credit report lets you know whether doing business together is a good risk. If your supplier pays its own suppliers late, that could mean a delay for your shipment. But if you were to check its credit report before committing, you could spot that late payment history, then look for another vendor that's more reliable. The same goes for companies you sell to — you want to be sure they'll pay on time and stay in business so you can keep selling to them.

Knowing your clients' credit history is critical if you manage cash flow with accounts receivable financing. Since your clients' invoices are collateral for a loan to your business, the lender will check your clients' credit histories to determine your interest rate. By checking your client's credit histories first, you can keep bad apples out of the ledger of invoices you're borrowing against — and keep interest payments affordable.

D&B, Experian and Equifax make it easy to check another company's credit report. It's as simple as going to the bureaus' websites and paying the fees. Options include a single report on a single company, a batch of reports on multiple companies and long-term monitoring of targeted companies.

You can check your own company's credit report the same way, or sign up for a monitoring service that alerts you when your credit score changes or is checked by someone else.

How Your Business Credit Score Affects Financing

Just as you can look up another company's credit report, any other company — whether it's a bank, insurer, vendor or potential client — can check yours. They will want to know whether your company is solvent, stable and reliable before doing business with you. This means that the information in your credit report, whether good or bad, can have a major impact on financing and many other aspects of your business. Here's how:

  • discount icon

    Interest rates on loans and credit

    It's no surprise that banks are the biggest users of business credit reports. An excellent business credit score can mean a low interest rate on a bank loan or credit card, as well as a higher credit limit. If your credit score isn't high enough to meet banks' rigorous standards, there are plenty of alternative commercial lenders, but they tend to charge higher interest rates.

  • homeInsurance icon


    A past bankruptcy can make your company look risky, leading to higher rates for general liability insurance. And in the eyes of an insurer, if your company misses other monthly payments, it might miss insurance payments as well. Finally, statistics show that fewer insurance claims are filed by people with good credit. All this adds up to lower insurance premiums for a company with a good credit history.

  • carInsurance icon

    Better terms from suppliers

    Suppliers are often willing to accept payment on a 30-day or 60-day term, but they need to trust that you'll pay them back on time. A good credit report can help you get favorable payment terms, while a negative payment history could cause suppliers to decline your business or demand cash on delivery.

  • bond icon

    Equipment leasing

    Many companies need financing for heavy equipment that's too expensive to purchase upfront. If your business has a good credit score, the interest rate on an equipment lease will be much lower. The payment term may also be longer, leading to monthly payments that are even more affordable.

  • insurance2 icon

    Protection for your personal credit

    Your business credit score isn't harmed by inquiries, but your personal credit score is. If your business credit report shows a long track record of on-time payments and overall financial stability, lenders and suppliers are more likely to offer your company credit without checking your personal credit.

  • bigHouseRent icon

    Protection against personal liability

    A company with good credit is less likely to need a personal guarantee in order to get business financing. In other words, you won't need to use your house or car as collateral.

  • briefcase icon

    Attracting investors

    Investors can fuel the growth of your company, but they need to know that it's a good bet. An established business with healthy finances, ample available credit and good relationships with creditors can make for an attractive investment.

  • money2 icon

    Improving cash flow

    A good credit report means lower interest rates across the board for any type of financing your business might need. Businesses also tend to receive lower interest rates and more favorable lines of credit than individuals. All this adds up to healthy cash flow for your business.

How to Build Business Credit

Business credit needs to be built methodically and managed carefully. As your company is getting off the ground, follow these steps to build a positive credit history.


Establish your business as a separate legal entity.

This allows your business to build a credit history that's independent of your personal credit history. Setting it up as a corporation or LLC also will protect your personal assets from business debts or liability. A partnership or sole proprietorship won't offer the same protection but will still achieve the goal of establishing a separate identity for the business. No matter what type you choose, be sure to meet all local, state and federal regulations.


Get a Tax Identification Number from the IRS.

Just as your social security number is linked with virtually all of your financial records (loan, lease and job applications, to name a few), a tax ID number or TIN (also called an Employer Identification Number or EIN) will be linked to all of your business's financial information. Think of it as the legal and financial fingerprint for your company.


Get a DUNS number from Dun & Bradstreet.

The best way to start a credit file for your company is to proactively establish one by becoming listed on the Dun & Bradstreet database. D&B (unlike Experian) will open a credit file for your business upon request. As part of the process, it will issue a nine-digit Data Universal Number System (DUNS) number, which is the most widely used number in the U.S. for identifying companies. Lenders will reference this number when looking for information about your business.


Open a business checking account.

Using your new EIN and DUNS numbers, open a checking account in your business's name. Use this account (NOT your personal account) for routine business expenses such as rent, utilities, and supplies.


Get a business credit card.

Make sure the card is in your business's name and is linked to its EIN and DUNS numbers. Applying at a bank where you already have a personal account in good standing can make it easier to get approved. Use the card strategically to start building a positive credit history. Just make sure to pay it on time (with funds from your new business checking account). And a good rule of thumb is not to use more than 25 percent of the credit available, as such use affects your business credit score.


Buy from suppliers on credit.

Ask if they will report your company's positive payment history to the business credit bureaus. If they won't, look for vendors who will. This positive payment history will become an important part of your credit report and lead to a higher credit score.


Manage your business finances carefully.

Pay your bills on time — or early, if possible, which will lead to a higher credit score. Since your business credit report includes more than payment history, be conscientious about all aspects of your business finances, including tax payments and filings.


Check your credit reports — all of them.

Since D&B, Experian and Equifax aren't required to share information with each other, and since many vendors only report trade payment data to one bureau, it's a good idea to check all three, especially as a new business. If there are errors, the burden of proof is on your business, not the credit bureaus, for correcting them. Going forward, check them once a year.

Low-Cost and Free Credit Checks for Your Business

Personal credit reports are easy to access for free: not so business credit reports. Typically, businesses pay for access to their credit report.

A free business credit report may be accessible, however, under these circumstances:

  • You apply for business credit from a lender
  • The lender contacts a business credit bureau and finds your credit rating insufficient
  • You receive notification that your credit application has been denied by the lender
  • You reach out to the specific credit bureau whom the lender contacted to determine your eligibility for credit and request access to your credit report.
  • The credit bureau in question provides a one-time, free credit report for your business.

What Paid Credit Checks Do for You

Of course, it's best to have regular access to your credit report. For that, you'll need to pay — and with business credit reports, you get what you pay for. For example, D&B offers reports for $12.99 each, but these don't come with a credit or PAYDEX score. Here's a breakdown of the cost of a report (with your business credit score), per credit bureau:

Having to pay for regular credit reports is not fun. But here's the silver lining: D&B offers free credit monitoring at CreditSignal, so that when your score changes for the better (or the worse) you will receive notification and can:

  1. anticipate a lender's reaction to a request for more credit
  2. choose when to request a copy of your credit report based on real data.

To do a credit check on your business, follow these steps.


Obtain an employee identification number (EIN) from the IRS


Register your business with any of the major credit bureaus

Submit your financial statements, registration number, supporting documents and other required information. The credit bureau will contact your creditors to receive updated information.


Request (and pay for) your credit report from one of the major bureaus


Review your report for any inaccuracies or incomplete information

Should You Use Credit or Take Out a Loan?

This depends on your business needs. When you take out a business loan, you receive a one-time lump sum of money for a specific purpose. You'll pay this off on a monthly basis while accruing interest, much like you do with a car or a house. A business credit card, on the other hand, can be used now or into the future. Like a personal credit card, you can use it for a variety of purposes; it can be paid down and billed back up again as needed. You can also take out a business line of credit, which you can also use and pay off as needed. (And in case you were wondering, business debt doesn't reflect on your personal credit score.)

Michael Aning, Branch Manager of Mosaic Mortgage in California, is a small business owner and mortgage broker who also deals with commercial leases and loans. For very small businesses, such as sole proprietorships, he suggests a business owner either use a business credit card or take out a personal line of credit.

"[A] credit card is easier to use point-of-sale [than a loan] if you're going to buy something, but your debit card tied to your checking account could do the same thing. The only difference is convenience," says Aning. He suggests that unless you need a chunk of change up front, you're better off getting a line of credit or using a credit card instead of a loan: That way you pay less interest over time. However, if you do need significant funds up front, then a loan is the way to go.

Expert Q&A

Pam Ogden is the president and founder of Business Credit Reports, which is licensed by Dun & Bradstreet, Experian, and Equifax to provide business credit reports that combine information from all three bureaus.

How is the trade payment information that goes into a credit report collected?

Pam Ogden
Pam Ogden:

There are thousands of manufacturers and wholesalers and other business-service companies that report to the credit bureaus about how their customers are paying them. But usually, a company only turns trade payment data over to one credit bureau, not all three. This is unlike consumer credit, where all major credit card companies report to all three consumer bureaus.

What impact does this have on businesses?

Pam Ogden
Pam Ogden:

It really hurts the small business trying to get a loan, a lease or a line of credit, and get it on preferred terms. The problem is that one credit bureau might have so little information that the business doesn't get preferred terms, even if it pays its bills on time and is a good risk. That's why you need [credit reports from] all three bureaus for a small business. If there are only one or two vendors reporting to one bureau, two others reporting to another bureau and three to a third bureau, when those credit reports are combined, all of a sudden this small business looks great. But if there's only one trade line from Dun & Bradstreet, the business doesn't look good.

Do all suppliers and wholesalers report trade payment information?

Pam Ogden
Pam Ogden:

Some companies don't do it, and they're hurting the 90 percent of customers that pay on time and could get a positive trade line on their credit reports. We tell companies to look at the synergy of reporting positive trade information on their good, paying customers. It helps them get the credit they need at the lower interest rates they need so that they can grow their businesses and buy more from their suppliers. It's a great synergy.

How can a small business persuade its vendors to report?

Pam Ogden
Pam Ogden:

If you're looking at multiple vendors, ask them, "Do you report to the business credit bureaus? If you don't, I'm going to buy from another vendor that does." That would help make everyone report.

How has technology changed the world of business credit?

Pam Ogden
Pam Ogden:

Technology has been awesome. It has made it much easier for companies to report. It used to be that only the huge companies could report, and it was a huge undertaking. Now, if you can output trade payment information about your customers into an Excel spreadsheet, you can report. It's that simple.


  • Dun & Bradstreet
    D&B is one of the three major business credit-reporting bureaus. Visit its website to check your own credit report, look up other companies and read expert advice for business owners.

  • Experian
    Business and consumer credit bureau. Use the website to check your own credit report and find resources for your business.

  • Equifax
    Business and consumer credit bureau. Visit the website to check your own credit report, look up other companies and read expert advice for business owners.

  • Business Credit Facts
    Hosted by Experian, this website offers expert advice for business owners about credit, financing, taxes and other matters.

  • U.S. Small Business Administration
    This site offers resources for small business owners, including information on how to build and manage business credit.

  • National Association of Credit Management
    NACM is a trade association for business credit and financial management professionals.

  • Nav
    Formerly Creditera, Nav offers credit-monitoring services to business owners.

  • Business Credit Reports
    Licensed by Dun & Bradstreet, Equifax and Experian provide business credit reports that incorporate information from all three bureaus.

About MoneyGeek Team

MoneyGeek Team headshot

The MoneyGeek editorial team has decades of combined experience in writing and publishing information about how people should manage money and credit. Our editors have worked with numerous publications including The Washington Post, The Daily Business Review, HealthDay and Time, Inc., and have won numerous journalism awards. Our talented team of contributing writers includes mortgage experts, veteran financial reporters and award-winning journalists. Learn more about the MoneyGeek team.

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