Business Credit Scores - What You Should Know

ByNaftali FeigJun. 30, 2020

This site is a free online resource that strives to offer helpful content and comparison features to its visitors. Please be advised that the operator of this site accepts advertising compensation from companies that appear on the site, and such compensation impacts the location and order in which the companies (and/or their products) are presented, and in some cases may also impact the rating that is assigned to them. To the extent that ratings appear on this site, such rating is determined by our subjective opinion and based on a methodology that aggregates our analysis of brand market share and reputation, each brand's conversion rates, compensation paid to us and general consumer interest. Company listings on this page DO NOT imply endorsement. We do not feature all providers on the market. Except as expressly set forth in our Terms of Use, all representations and warranties regarding the information presented on this page are disclaimed. The information, including pricing, which appears on this site is subject to change at any time.

 Why your business credit score matters
Your credit score is one of the most important financial markers of your business. It can mean the difference between being approved or rejected for a business line of credit or business loan. To ensure you’re always in good standing, you have to understand what a credit score is, how it’s determined, and how you can increase your rating if need be.

The Top Lenders at a Glance


Minimum Credit Score Time Until Funding Visit Site
Torro None Within 48 hours View Rates
Fundera 500 2 days to 2 weeks depending on the lender View Rates
OnDeck 600 As fast as 24 hours View Rates

What is a Credit Score?

A business credit score represents how reliable your company is when it comes to paying back loans or paying off purchases. Unlike personal credit scores, which are rated between 300 and 850, business credit is expressed as a number between zero and 100.

There are several factors involved in determining a credit score. The three major business credit agencies -- Experian, Equifax, and Dun & Bradstreet -- use a combination of these indicators in different algorithms to calculate your final score. As a result, your business rating might vary slightly between agencies.

View the top 10 business loan lenders >>


Some of the factors considered include:

  • Your overall business credit history
  • The size of your company
  • How long you’ve been establishing credit
  • Previous payment history
  • Amount of late payments
  • Outstanding loans
  • Percentage of available credit you’re currently using
  • Types of credit in your history
  • How often a new line of credit is requested

Information may be collected from banks, credit card issuers, and any institution responsible for lending your business money or extending lines of credit. Not all factors carry the same weight when calculating your credit score, so it can be difficult to know which ones have the greatest effect on your rating.

Fortunately, you have control over most of these factors, and keeping ahead of your payment schedules will ensure you have an excellent credit score when you need it.

Why Credit Score Matters to Your Business 

Business credit scores are major financial credentials, indicating to loan providers that you have reliably paid back loans or bills in a timely manner and can be trusted to meet loan payment obligations. The better a credit score, the faster and easier a business will be approved for a loan or line of credit. Expediting the usually long and complex loan process can get your company the money it needs with a minimal amount of hassle.

When you know how to boost your credit score, you may also enjoy some perks from vendors. Suppliers are more comfortable extending credit to businesses with favorable credit ratings. Some will waive the usual down payment requirements on large purchases and give you a more generous time frame in which to pay, allowing your company to afford equipment upgrades without taking out a loan.

How to Improve Your Credit Score

For businesses, a credit rating of 75 or higher is considered excellent. To become aware of your current credit situation, run a credit check. Analyze the report to see if there are any unsettled accounts, outstanding payments, or charges you were unaware of. People often have credit problems based on debt that they never knew they had. Before running the report, however, make sure that doing so won’t negatively impact your score. Too many credit checks in a short period of time can make lenders wary.

If your credit rating is less than perfect, there are a few things you can do to improve it and show lending institutions that you’re serious about paying back their loans:

  • Consider a debt consolidation or settlement plan. Make sure to deal with a reputable debt expert as these plans can have an adverse affect on your credit score if not handled properly.
  • Stop applying for continuous lines of credit. Multiple requests can reflect negatively. If you’ve been rejected because of poor credit, give yourself some time to rebuild your reputation before trying again.
  • Create a regular monthly payment schedule, and make sure to pay bills on time.
  • Work with a financial advisor if necessary to get your debt under control and create a solid payment plan.
  • Clean up your personal credit, and deal with outstanding personal debts.

Should your credit score remain low despite taking these steps, contact the credit institutions about potentially incorrect information. Sometimes factors used to calculate your score need to be fixed to reflect your company’s true creditworthiness. 

Know your credit score
Understand your business' credit score

The 3 Best Lenders 

1. Torro

Torro

  • No collateral required
  • Approval in under 48 hours

Torro offers five main types of business funding for new and existing companies, including startup funds, working capital loans, and merchant cash advances. The application process is simple, approval is fast, and funding is usually received within 48 hours.

Read the full Torro review

View Rates

2. Fundera

Fundera

  • Keeps information private, even from lenders
  • Highly acclaimed

Founded as an alternative to traditional bank loans, Fundera has worked hard to build a solid reputation of trust, professionalism, and competitive rates. With a wide range of loan types and flexible repayment options, Fundera gears itself towards small business loans and provides loans of anywhere from as little as $5,000 up to $5 million.

Read the full Fundera review

Fundera Fundera View Rates

3. OnDeck

OnDeck

  • 24-hour approval
  • Excellent customer service

OnDeck offers conventional business loans and lines of credit, allowing flexibility to get the loan you need. Best of all, you can have your money within 24 hours with fast approval and excellent customer service.

Read the full OnDeck review

View Rates

Working With Bad Credit 

If your business is struggling to grow, a small business loan can help. Alternative lenders are a possible choice if you need to improve your credit score. Getting these loans and paying them back on time can improve your score and make you eligible for traditional loans in the future.

Filter the top 10 lenders by credit score >>

Look for lenders requiring no minimum credit score or that take other factors into account when considering whether to approve your application. Read up on all the information you need to know about personal and business loans, and then utilize one of the best loan providers to get the best rates and services for your business now.