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Businesses Credit Score Guide

9 months ago

Business Credit Score Guide

As you may already know, a credit score is a number that lenders use to assess creditworthiness. It's based on your credit history, which includes information such as your payment history, outstanding debts, and the types of credit you have previously used.

A good credit score can help you get approved for loans, credit cards, and other forms of credit, and it can also help you get a lower interest rate on these products. It's not just applicable to consumers, it applies to businesses too. In this guide, we explain why you should know your business's credit score and what you can do to improve it.

Why Credit Scores Matter to Businesses

A good credit score can be just as important for businesses as it is for individuals. A good credit score can help you get approved for Business Loans, Invoice Finance, lines of credit, and other forms of business finance. As well as helping you gain access to a range of finance options, a good credit score can also help you access a lower interest rate, saving your business money.

It's not just limited to finance products. A good credit score can help you build a positive relationship with your suppliers, giving you access to more favourable payment terms. Having an improved supplier relationship could make a big difference in the growth of your business.

The Benefits of a Good Credit Score for Businesses

There are many benefits to a good business credit score. The following is a selection of some of the benefits of having a good credit score for businesses:

Lower interest rates on loans and lines of credit

Businesses with good credit scores are more likely to be approved for loans and lines of credit. They are also more likely to get a lower interest rate on these products. This alone can save your business money in the long run.

Increased access to capital

If your business has a good credit score, you're more likely to be approved for loans and lines of credit, which gives you access to more capital. Increasing your access to capital is an effective route to helping your business grow and expand.

Improved relationships with lenders

Businesses with good credit scores are more likely to have positive relationships with lenders. This can make it easier to get approved for future business loans, credit cards and other lines of credit. A better credit rating can also help your business get better terms on these products.

Increased credibility with customers and suppliers

Your business should be seen as more credible by your customers and suppliers if you have a good credit score. This can help your business attract new customers and suppliers, and negotiate better terms.

Credit Score visualisation

How to Improve Your Business Credit Score

Here are some tips for businesses that want to improve their credit score:

  • Pay your bills on time

    This is the most important factor in determining your credit score. Make sure to pay all of your bills on time, including your credit card bills, utility bills, and mortgage payments.

  • Keep your credit utilisation low

    Your credit utilisation is the amount of credit you are using compared to the credit you have available. Try to keep your credit utilisation below 30%.

  • Don't apply for too much credit

    Applying for too much credit can hurt your credit score. If you need to apply for credit, try to do it all at once.

  • Dispute any errors on your credit report

    If you see any errors on your credit report, dispute them immediately. Errors can lower your credit score, so it is important to get them corrected as soon as possible.

Get Your Free Experience Credit Score

Checking your credit score is a free and easy way to see how you are doing. You can check your Experian Credit Score for free at Capitalise. By checking your credit score, you can identify any areas that need improvement and take steps to improve your score. A good credit score can help you save money and build a positive relationship with your lenders.

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Jon Cole-Dalton