If you are a small business owner in Australia, are you ignoring the one ‘number’ that is a major success factor in securing finance to improve your business?
A whopping 93% of businesses have never accessed their business credit score¹.
You may be like many of our business clients who, when they first come to us for help with business financing, don’t know that there is such a thing as a business credit score.
A business credit score is a number between 1 and 1,200 that is calculated using the information on your business credit file.
So naturally you may ask what information is on your business credit file. Your business credit score is calculated using information on your credit file such as:
• How long the business has been in operation
• Company details including entity name and company structure
• How many and the type of credit enquiries your business has made
• Commercial credit information including any defaults, judgements or court writs
• Director information including defaults, court judgements and bankruptcies
• Information on public record
• and more.
Credit reporting bureaus make available reports that detail this information together with your credit score that lenders may utilise in their assessment of your loan application.
The higher the number the better your score and the more likely you will be able to borrow money. A low credit score may prevent you from being able to borrow.
As with personal credit scores, defaults, late or missed payments can contribute to a lower score – as can how many times you may have applied to various lenders.
How to get your credit score
Business credit scores are available through credit reporting bureaus such as Equifax, Experian and Illion. We can help you understand your report and step you through any actions needed. Sometimes there are discrepancies in the report which can be rectified with the reporting bureau.
We have helped many business clients improve their credit score but…
The best approach is prevention
The good news is there are ways to ensure you achieve a good credit score. Contact us for our tip sheet on how to maintain a good business credit score.
Your business credit score is a critical factor in securing business finance. While you may not need access to funding right now, being well informed and taking proactive action will set you up for success in the future and avoid difficulty in addressing unwanted events long after they have occurred.
Read our tip sheet on How To Maintain A Good Business Credit Score. Then, let’s chat. We can share all we know about good credit reports and how you can secure asset finance for
business growth.
PS: Avoid late payers with payment histories! You can even request company credit checks on your business customers giving you information on their credit score, payment history and more.