4 Easy Ways to Improve Your Business Credit Score
Among the many details that small business owners need to focus upon, one of the most vital is their business credit score. Good credit ratings offer benefits such as better terms from vendors and suppliers and easier access to capital from financial institutions. Here are some tips on improving your company’s business credit score.
Use Credit Wisely
To obtain a business credit score, you need to generate credit by opening a credit card account and applying for loans. Maintain company credit cards separate from your personal credit cards to help build credit for your business. However, keep your credit utilization ratio and your debt levels low, which improves your credit rating. Avoid risky financial activities that might in any way jeopardize your business credit score.
Keep Your Accounts Open
Although you may be tempted to close credit card accounts that you have paid off in full, leave them open to avoid negatively impacting your business credit rating. Keep them active even if you don’t use them to maximize the amount of credit that you have available.
Pay Bills Promptly
Late payment of bills causes your business credit rating to plummet. Always pay your bills on time or early, which not only improves your credit rating, but also promotes good relationships with vendors, suppliers, and creditors. Financial responsibility is always a key to creditworthiness.
Monitor Your Credit Report
As a small business owner, it is imperative that you periodically check your business credit report. This enables you to discover any mistakes, inaccuracies, and outdated information that may cause your business credit score to drop. If you find any errors, contact the relevant credit reporting agencies and let them know so that your records can be amended. Even small mistakes can have severe negative repercussions on your credit ratings.
For more advice on improving business credit scores and other aspects of business finance, get in touch with ASA Capital Funding.