Ways to improve your business credit rating

Here are six easy ways to improve your business credit rating

Pay Bills on Time

Making late payments is one thing that will damage your credit rating. If you are making late payments on a regular basis, it can cause some serious damage to your records especially if your creditor chooses to report you. Thus, it is necessary that you pay your business bills on time and make it a habit. This will not only help you improve your credit score but will also help you maintain a good relationship with your creditors.

Limit Credit Usage and Keep Debt Levels Low

If your business owes a lot of money to other banks and lenders, then this might be one factor that will affect your business credit rating. Every business needs more than one loan to cover its monthly expenses and pay its employees (which is also advisable by most financial advisors). However, experts even recommend keeping any revolving debt low. By doing this, it helps you lower your credit utilisation, which works well to keep your credit rating high.

Check your business credit report on a regular basis

Most business owners are unaware about their business’s credit scores. However, it is a good practice to keep a track your company’s credit score from time to time. By doing this, you are well aware of any minor errors or inaccuracies in the report.

Strive to use credit

As most financial experts like to say, “credit usage is a game that has to be played well.” Any business is required to open few business credit accounts such as credit cards and loans. Moreover, make sure that you play by the rules and pay your creditor back on time.

Avoid closing accounts

If you are planning to close any of your credit account and remove them from your credit report because they are fully paid out, it could prove to be a bad choice. This is something every small business should particularly avoid. Closing your credit account to avoid any future spending can has adverse effects on your business credit rating and may in turn limit the amount of credit you are truly eligible for.

Correct any mistake

It is true that a smallest mistake or error can have a great impact on your business’s credit rating. It is advisable to correct this as soon as possible. Any mistake that you notice on your credit report, no matter how small it may be, should be rectified immediately.