What is a business credit score and how to improve yours

Published Friday 15 May 2026

Table of contents

• What is a business credit score?
• Why your business credit score matters
• How business credit differs from personal credit
• How are business credit scores calculated?
• Business credit score ranges by bureau
• How to check your business credit score
• What is a good business credit score?
• How to get a good business credit score
• How to establish business credit for the first time
• How to deal with businesses who have a poor credit score
• Build stronger business credit with Xero
• FAQs on business credit scores

Key takeaways

• A business credit score is a numerical rating that measures your company's creditworthiness, tracked by bureaus like Dun & Bradstreet (D&B), Experian, and Equifax. Each bureau uses its own scoring range, so it's worth checking more than one.
• Strong business credit helps you qualify for better loan terms, negotiate favorable payment terms with vendors, and lower insurance premiums. It also keeps your personal finances separate from your business.
• You can build and improve your business credit by paying bills on time, keeping credit utilization under 30%, and regularly reviewing your reports for errors. Checking three to four times a year is a good practice.
• If you're just starting out, register your business, get an Employer Identification Number (EIN), and open accounts with vendors who report to credit bureaus. These steps lay the foundation for a solid credit profile.

What is a business credit score?

A business credit score is a numerical rating that measures your company's creditworthiness and likelihood of paying debts on time. It works similarly to a personal credit score, but it's tied to your business rather than to you as an individual.

Credit bureaus like Dun & Bradstreet (D&B), Experian, and Equifax track your business's financial behavior and assign a score based on factors like payment history, public records, and credit utilization. Your business is typically identified by its EIN rather than a Social Security number. Lenders, suppliers, and even potential partners may check this score before deciding to work with you.

The FICO Small Business Scoring Service (SBSS) is another widely used score, particularly for Small Business Administration (SBA) loan applications. Each bureau and scoring model uses a different range, so there's no single "universal" business credit score.

Why your business credit score matters

Your business credit score influences many of the financial decisions that shape how your company operates and grows. A strong score opens doors, while a weak one can limit your options.

Here are some of the ways your business credit score affects your day-to-day operations:

• Loan approvals and interest rates: lenders use your score to decide whether to approve financing and what rate to offer. A higher score typically means lower borrowing costs when applying for a business loan.
• Vendor and supplier terms: suppliers may offer net-30 or net-60 invoice payment terms to businesses with solid credit, giving you more time to pay without penalties
• Insurance premiums: some insurers factor in business credit when setting premiums, so a better score could mean lower costs
• Evaluating customers: if you extend credit to other businesses, their credit scores help you assess the risk of late or missed payments
• Separating personal and business finances: a strong business credit profile means you're less likely to need personal guarantees, which protects your personal assets

How business credit differs from personal credit

Business credit and personal credit serve similar purposes, but they work differently in several important ways. Understanding the differences helps you manage both effectively.

Personal credit is tied to your Social Security number and scored on a 300–850 range (FICO). Business credit is linked to your EIN, and scoring ranges vary by bureau. D&B's PAYDEX score runs from 1–100, Experian's Intelliscore Plus uses 1–100, and the FICO SBSS ranges from 0–300.

The information used to calculate each score also differs. Personal credit relies heavily on your individual borrowing and repayment history, while business credit draws on trade payment data, public filings like liens and judgments, company size, and industry risk factors.

One key difference to keep in mind: business credit reports have fewer legal protections than personal reports. The Fair Credit Reporting Act (FCRA) primarily governs consumer credit, not business credit. That means you don't have the same automatic dispute rights, but you can still contact bureaus directly to correct errors on your business reports.

How are business credit scores calculated?

Each credit bureau uses its own algorithm, but they generally look at similar categories of information. Knowing what goes into your score helps you take the right steps to improve it.

The main factors that influence your business credit score include:

• Payment history: whether you pay suppliers and lenders on time, early, or late. This is typically the most heavily weighted factor.
• Credit utilization: how much of your available credit you're using. Keeping this under 30% signals that your business manages debt responsibly.
• Length of credit history: how long your business has had credit accounts open. Longer histories generally work in your favor.
• Public records: bankruptcies, liens, and judgments can significantly lower your score
• Company details: your industry, business size, and number of employees may factor into risk assessments
• Vendor and trade reports: payments to suppliers who report to credit bureaus directly build your profile

The specific weight each bureau gives to these factors varies. D&B's PAYDEX score, for example, focuses almost entirely on payment history, while Experian's Intelliscore Plus incorporates a broader mix of financial data.

Business credit score ranges by bureau

Unlike personal credit, there's no single standard range for business credit scores. Each bureau uses its own scale, which can make comparisons confusing if you're not familiar with them.

Here's how the major scoring models break down:

• D&B PAYDEX: ranges from 1–100. A score of 80 or above is considered low risk, meaning you consistently pay on time or early. Scores below 50 indicate significant payment delays.
• Experian Intelliscore Plus: ranges from 1–100. Scores of 76–100 represent low risk, 51–75 is medium-low risk, 26–50 is medium risk, and 1–25 is high risk.
• Equifax Business Credit Report: provides several scores, including a payment index (0–100) and a credit risk score (101–992). The OneScore combines multiple data points into a single risk rating.
• FICO SBSS: ranges from 0–300. This score is widely used for SBA loan applications, where a minimum of 155 is often required to pass the initial screening.

Because each bureau calculates scores differently, it's a good idea to check your score with more than one provider. A strong score on one bureau doesn't always guarantee the same result on another.

How to check your business credit score

Checking your business credit score regularly helps you catch errors early and track your progress over time. Aim to review your reports three to four times a year.

Here's where you can access your scores:

• D&B CreditSignal: offers free access to some of your D&B scores and alerts when your report changes. Full reports require a paid subscription.
• Experian: business credit monitoring starts at around $39.95 per month, which includes ongoing access to your Intelliscore Plus and other metrics
• Equifax: business credit reports are available through Equifax directly or through third-party monitoring services
• FICO SBSS: this score is typically accessed through lenders during the loan application process rather than purchased directly

When you review your reports, look for inaccurate payment records, outdated company information, or accounts that don't belong to your business. If you spot an error, contact the bureau directly to start a dispute. Unlike personal credit disputes, there's no standardized federal process for business credit corrections, so staying proactive is essential.

What is a good business credit score?

What counts as a "good" score depends on which bureau you're looking at. Each uses its own range and risk categories, so the number that puts you in the low-risk zone varies.

Here's a quick summary of where you want to be with each bureau:

• D&B PAYDEX: 80 or above signals low risk and shows you pay on time or early
• Experian Intelliscore Plus: 76–100 is the low-risk range
• FICO SBSS: 155 or above is typically the minimum for SBA loan eligibility, though higher scores improve your chances

Don't stress over a few points in either direction. The goal is to stay consistently in the low-risk zone for each bureau. If you're close to a threshold, small improvements in payment habits and credit utilization can make a real difference over time.

How to get a good business credit score

Improving your business credit score takes consistent effort, but the steps are straightforward. Focus on the habits that bureaus reward and avoid the ones that drag your score down.

Review your business credit score three to four times a year

Regular monitoring lets you spot issues before they become problems. Check your reports with D&B, Experian, and Equifax to get a full picture of how your business appears to lenders and suppliers.

If you find an error, contact the credit bureau directly to dispute it. Business credit reports aren't governed by the FCRA the same way personal reports are, so there's no standardized dispute process. However, bureaus do accept and investigate corrections when you provide supporting documentation.

Pay bills on time

Payment history is the single most important factor in your business credit score. Even one late payment can lower your rating, so set up reminders or automate your accounts payable to stay on track.

If you can pay early, even better. The D&B PAYDEX score specifically rewards early payments with higher scores. Consistent on-time payments over several months will steadily improve your position across all bureaus.

Healthy cash flow makes it easier to pay on time. Tracking your income and expenses regularly helps you plan ahead and avoid cash crunches that lead to missed deadlines.

Be upfront if you're having cash flow issues

If you're struggling to pay a supplier on time, communicate early. Many vendors are willing to negotiate adjusted terms or payment plans when you reach out before the due date. This approach protects the relationship and may prevent a negative report to credit bureaus.

Keep credit utilization low

Credit utilization measures how much of your available credit you're currently using. Aim to keep this ratio under 30%. If you consistently use most of your available credit, it signals higher risk to bureaus and can lower your score.

You can improve utilization by paying down balances more frequently or requesting credit limit increases on existing accounts. Both strategies reduce your ratio without requiring you to take on less credit.

How to establish business credit for the first time

If your business is new, you won't have a credit history yet. Building one from scratch takes a few deliberate steps, but the process is simpler than you might expect.

Follow these steps to start building your business credit:

1. Register your business as a legal entity (LLC, corporation, or partnership) with your state. This separates your business identity from your personal one.
2. Get an EIN from the IRS. This is the number credit bureaus use to track your business, much like a Social Security number for personal credit.
3. Open a dedicated business bank account. Keeping business and personal finances separate is essential for building a distinct credit profile.
4. Apply for a D-U-N-S number through Dun & Bradstreet. This free number is required for D&B to create a credit file for your business.
5. Open a business credit card and use it for regular purchases. Pay the balance in full or on time each month to start building a positive payment history.
6. Work with suppliers and vendors who report payments to credit bureaus. Not all do, so ask before you sign up. Trade credit from reporting vendors is one of the fastest ways to build your profile.
7. Keep your business and personal accounts separate. Mixing the two can complicate your credit history and make it harder for bureaus to assess your business independently.

How to deal with businesses who have a poor credit score

If you extend credit to other businesses, you'll eventually encounter customers with poor credit scores. Knowing how to handle these situations protects your cash flow without necessarily losing the relationship.

Here's how to manage the risk:

• Know what poor looks like: a D&B PAYDEX below 50, an Experian Intelliscore Plus below 25, or a history of liens, judgments, or late payments should raise a flag
• Set cautious payment terms: consider requiring upfront payment, shorter terms (net-15 instead of net-30), or smaller credit limits until the customer proves reliability
• Lower your dependence on late payers: diversify your customer base so that one slow-paying client doesn't put your own cash flow at risk

Checking a potential customer's business credit score before extending terms is a smart habit. It takes just a few minutes and can save you from chasing overdue invoices down the road.

Build stronger business credit with Xero

Staying on top of your finances is one of the best things you can do for your business credit score. When you have clear visibility into cash flow, upcoming bills, and outstanding invoices, you're in a much better position to pay on time and keep utilization low.

Xero's cloud accounting software helps you track income and expenses in real time, automate invoice reminders, and reconcile bank transactions, so you can spend less time on admin and more time growing your business. Get one month free.

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FAQs on business credit scores

Here are answers to some frequently asked questions about business credit scores.

Does my LLC have its own credit score?

Yes, an LLC can have its own business credit score, separate from your personal score. To build one, your LLC needs an EIN, a D-U-N-S number, and active accounts with vendors or lenders who report to business credit bureaus.

Does your EIN have a credit score?

Your EIN itself doesn't have a credit score, but it's the identifier that credit bureaus use to track your business's financial activity. Once you start opening accounts and making payments under your EIN, bureaus build a credit profile and assign scores based on that history.

How long does it take to build business credit?

You can start establishing a business credit profile within a few months of opening trade accounts with reporting vendors. However, building a strong score typically takes six months to a year of consistent, on-time payments.

What bureaus report business credit scores?

The three main business credit bureaus are Dun & Bradstreet, Experian, and Equifax. The FICO SBSS is another widely used score, particularly for SBA loan applications. Each uses its own scoring model and range.

Can personal credit affect your business credit score?

Yes, in some cases. Some lenders and scoring models, including the FICO SBSS, factor in the business owner's personal credit history alongside business data. This is especially common for newer businesses that don't yet have an established business credit profile.

How often should you check your business credit score?

Aim to check your business credit reports three to four times a year. Regular reviews help you catch errors, monitor progress, and address issues before they affect your ability to secure financing or favorable terms.