A business credit score is a numerical representation of the risk your business poses to lenders. A high business credit score means that you make your payments on time and are considered less risky by lenders. A good business score increases the likelihood of your loan applications being approved easily. Unlike personal credit scores which are standardized, each credit bureau may have its own scoring ranges and criteria to calculate your business score. Each of them has different factors based on which the scores are calculated: the company size, its level of credit utilization, any current outstanding debts, the length of the company’s credit history, etc. To calculate your business score, multiple factors are assigned scores of their own, and each of those has to fall under what is considered good. Here are a few of the bureaus and their credit score ranges:
- Dun & Bradstreet® Credit Score for Businesses: D&B generates three different credit scores: the PAYDEX Credit Score, a Financial Stress Credit Score, and a Commercial Credit Score. These scores indicate payment history, how likely they are to close operations in the next 12 months, and delinquent bill payments.
- Experian® Business Payment: The Experian Business score calculates how likely a business is to make delinquent payments. Over 800 factors are used to calculate this. The range is between 1-100. Any score above 76 is a good Experian score.
Equifax® Business Credit Scores: Like D&B, Equifax generates multiple scores as well. These include the Business Payment Index, the Business Credit Risk Score, and the Business Failure Score. Each of these scores has its own ranges within which they are considered good, average, or bad.
.
