While many of us recognise how personal credit scores can affect our individual borrowing capacity, the importance of business credit scores is often overlooked.
In fact, a recent survey found that only 10% of Australian small businesses have checked their score.
However, there are many benefits to understanding how your business stacks up.
Not only does it give an overview of your business’s financial health, but it can also provide an indication of your business’s borrowing ability.
What’s my business score?
Ranging from 0-1200, your business credit score is a number based on your business credit history.
The higher the number, the stronger your business credit score will be. And, a high score could also mean greater lending options.
To find out your score, visit an online credit score reporting agency like Equifax or Credit Simple.
What does it mean?
Like a personal credit score, a business credit score is mainly comprised of the business’s financial history, credit inquiries and company details.
But, it can also include information about any business you have been associated with in the past.
If you previously owned a business with loan defaults or missed payments, this information may affect your current score.
Not all business
Did you know that your personal credit history can also impact your business credit score? This is because any personal bankruptcies, defaults or court judgements will be linked to your business credit report.
If your credit score is low, it could be challenging to secure a business loan. The good news is, flexible lenders like Liberty will look beyond your credit history for solutions to help move your business forward.
To learn more about business loans, contact a Liberty Adviser today.