Increase your business credit score – Seven helpful strategies to use

Are you a business owner? If yes, you know that your business credit score is essential for your business success and performance. Also, do you possess any open credit? If yes, then you must also be having an equivalent credit score. And are also mulling on taking financial assistance in the form of a credit score or loan? If the answer is yes, then you also need to find out ways to increase the credit score.

Understanding a business credit score

Business credit scores and personal credit scores are somewhat similar. Many credit reporting agencies make use of multiple processes to estimate your creditworthiness. And this comprises your outstanding balances, trade experiences, payment records and many more. The score ranges from 0 to 100. The closer you go to 100, you have a chance to get the best deal.

Reasons to increase your business credit score

The primary reason for expanding the business credit score is that it impacts the funding that your business can procure in times of need. When you have a high credit score, your scopes to borrow money is easy and smooth. When your credit score is less, people and institutions might refrain from providing you with cash.

So, what to do when you find you have a low business credit score? First and foremost, there’s nothing to worry! Your credit scores can certainly go up when you deploy the correct initiatives. Are you thinking about how to raise your credit score? Discussed below are useful strategies that you can implement:

1. Analyze the business credit report

Want to get your business’s credit report? It’s simple! You have to procure it from the reporting companies like Experian and Equifax. However, the credit reports aren’t free of cost. Never mind if you are the business owner seeking the credit report. Even then you’ll have to take some essential steps to procure the report.

The moment you have an in-depth idea of your score, you’ll know what you will have to concentrate on. You will identify the factors that are affecting the report negatively. It will help you plan and prepare for increasing the business credit score.

2. Reduce the credit utilization ratio

One of the aspects that the credit reporting agencies consider, when they are outlining credit scores, is the credit ratiovis-a-vis the credit that’s available. Generally, it’s a smart call to keep the ratio less than 15%.

3. Make sure that you pay all the bills on time

It is one of the best ways to enhance your business credit score. And just in case you make it a practice not to pay the bills timely, you might reencounter a falling credit score. When this aspect isn’t taken care of, regardless of whatever you do to enhance your credit score, it won’t help you much.

4. Make sure to have positive payment incidents in the credit line

Not every supplier or vendor will share the payment information with the business credit, reporting companies. However, you have the chance to incorporate all trade references for the credit file via the credit reporting company. Hence, when you have increased positive payment incidents in your data, the better are your chances to improve the credit score.

5. Create credit accounts with the suppliers

Are you working with chosen suppliers for a long span of time? Do you also have a favorable payment bond with them? If yes then make sure that you create a credit account with these suppliers. It is going to maximize the count of favorable payments. And using this you can enhance your business credit score.

6. Enquire for any errors that take place

It’s essential to work in co-operation with the credit reporting agencies and the credit card companies and have a negative review eliminated from the credit line. Also, it’s essential to ensure that all that gets reported about your organization is updated and precise. The unpaid accounts along with hard inquiries will always hurt your credit report.  Hence, if you chance upon something in your credit report which you feel should get removed, always inquire and argue for it. And you will realize how it enhances your business credit score positively.

7. Always pay for delete in case of collections

If in any way one of the debts you owe goes to the collections, you should pay heed when the same arrives. Ensure that the agency deletes the unfavorable account from the credit report. Chances are you need to ask for this. Else, paying your debt will not be useful to increase your credit score.

Make sure that all your unfavorable account history gets removed entirely. It will only adversely affect your business credit score. Having a favorable credit score is always helpful. You might want to expand your business and need financial help. You can’t ask for financial aid with a low credit rate. So, follow them, and you can improve your credit ration manifold.

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