Business Credit Scores 101

Chris Hammel, Senior Credit Analyst, First Republic Bank
August 27, 2021

It’s common for businesses — especially small businesses — to seek new funding opportunities to reach business goals. And as the business expands, some of these funds can be paid back in the future. What you may not realize, however, is that your business has a credit score, too. 

Your business credit score serves a major purpose for lenders: along with financial statements, it provides a quick way to look at your company’s relationship with borrowing in the past. This is different from your personal credit score, which evaluates your own borrowing and repayment history (even though business lenders may look at both, especially for guarantors, who promise to be held individually responsible for repaying business debt).

If you’re in need of business lending, it’s critical to understand how business credit scores work, what they factor in, the agencies that calculate scores and how to check your business’ credit score. Here's a comprehensive guide to understanding business credit scores. 

What is a business credit score?

Your personal credit score tracks your personal relationship with credit by way of your loans, credit cards and the payments you’ve made on both. Your business credit score functions similarly, except it accounts for your company’s borrowing track record. Both are calculated by credit bureaus to rank a business’ or individual’s financial health. In general, business credit scores, along with financial statements such as tax returns, show whether a company is a good candidate to receive a loan or to become a supplier’s customer with a trade credit account.

Personal and business credit scores vary, however. Business credit scores tend to range from 1-100, with 100 being the best score possible. That’s different from personal credit scores, which are calculated on a 1-850 scale. Just like with your personal credit score, lenders are more likely to approve business borrowers with a credit score in a certain range depending on their appetite risk. 

What is a “good” business credit score?

A good business credit score is typically on the high end of the 1-100 range for two of the three major reporting bureaus. (FICO SBSS Business Credit Scores are on a scale of 1-300.) A score of 80 or higher for Dun & Bradstreet’s PAYDEX or Experian’s Intelliscore Plus generally means your business is considered to be low-risk for lenders and that the company has little to no history of late payments or loan defaults. Businesses that have a spotty repayment history can expect a low score. 

There are three major bureaus that track and report on business credit. Each has its own credit range and uses unique calculations in order to determine their scores.

Dun & Bradstreet PAYDEX 

Dun & Bradstreet PAYDEX Score Range

Rating Details
80 – 100 Good A 100 score denotes that most or all payments you make come 30 days sooner than the invoice terms. A score of 80 denotes that you make on-time payments. Any scores in between are a mix of both. 
50 – 79 Fair A score in the 70s suggests that you are paying invoices two weeks late, on average. Scores closer to 50 indicate that you often pay invoices 30 days late.
0 – 49 Bad A score in the 40s or lower suggests you have a record of paying invoices 60 days beyond terms (or longer).



Intelliscore Plus from Experian 

Score Range Risk Classification Details
76 – 100 1 Low
51 – 75 2 Low-Medium
26 – 50 3 Medium
11 – 25 4 Medium-High
1 – 10 5 High



FICO SBSS Business Credit Score

FICO SBSS scores are different from PAYDEX and Intelliscore Plus credit score calculations. FICO calculates your business credit score by considering your personal credit history as well as that of your company.

The Small Business Administration uses FICO SBSS scores to evaluate a business’s creditworthiness. Since many small businesses have a limited credit history, including the owners’ credit information helps paint a broader picture of their risk factor for lenders.

Factors that help determine business credit scores

Every business credit report is unique given the differences in how and where reporting agencies collect information. They also differ in terms of the methodology used to calculate your score. Although each agency creates a score in different ways, these are some of the core factors that help them determine your creditworthiness: 

  •  Length of credit history 
  •  Payment history  
  •  Amount and use of debt  
  •  Industry risk  
  •  Company size  
  •  Public records  

Checking your business credit score

It’s crucial for you to understand your business credit score and history. Checking your scores is easy and beneficial for a variety of reasons. 

Benefits of checking your business credit score

If you plan to take out a small business loan, line of credit or open a credit card, you’ll want to know your business credit score. This can help avoid surprises and give you a sense of what kind of loans might be a fit. 

Whether or not you plan to borrow anytime soon, checking your business credit score and your personal credit score as guarantor can help you:  

  •  Gauge how much financing you could be able to receive 
  •  Get a sense of your commercial insurance rate or other business loan rates 
  •  Receive longer payment plans, such as going from a net 30 term (30 days to pay back the loan) to a net 60 term (60 days to pay)  

Business credit scores benefit both you and potential lenders. A solid credit score, in conjunction with financial statements showing the health of your company year-over-year, gives lenders more security and confidence when lending your business money. As a business owner, you can use your credit score to get better loan terms and to feel confident in taking on financing to improve and grow your business.

How to check your business credit score

There aren’t many free business credit report resources available since credit bureaus aren’t legally required to provide free copies of business credit reports. That’s why it’s essential to stay away from websites that promise free business credit scores and reports, as they are most likely a scam.

Instead, consider reaching out to each credit reporting agency and bureau directly. Some platforms may allow you to access your credit report during a free trial, however. Free credit scores and reports may not give you a full picture of your business’s financial standing that comes with a paid credit report.

Prioritizing your business financial goals

Navigating your business finances can be less challenging once you understand how your company’s credit scores — and your guarantors’ personal credit scores — may impact your ability to borrow. Once you know your score, and understand what goes into determining it, you can move forward with a loan in confidence. Be sure to ask prospective lenders about terms, loan totals and other factors alongside your business credit score before taking out money. This can help you make sure you’re getting the right financing for your needs.

This information is governed by our Terms and Conditions of Use.