What is a credit report?

17 August 2021 Posted by: Centrix Business Resources
What is a Credit Report?

A credit report is a summary of a person’s or a business’s credit activity. It covers their payment history, current credit situation, and the status of their credit accounts.

Credit reports are created by reporting companies, also known as credit bureaus, which collect financial information and payment history data from creditors. Anyone who extends credit to a person or business can be a creditor, such as utility companies, banks, credit card companies, and other financial companies. 

Credit reports are used by savvy businesses to help them decide whether to offer a person or business credit, based on their potential risk of payment default. They feature a credit score, which is a number between 0 and 1,000 that indicates how likely a person or business is to pay their bills on time. Most credit scores are between 300 and 850. The higher the score, the better the credit rating.

Credit reports and credit scores are useful tools for any business that wants to loan money or extend goods or services to a consumer or business on credit and on what terms. Businesses who want to protect cashflow are unlikely to offer credit to a person or business with a low credit score, as there is a high risk that this won’t be paid back.

Consumer Credit Reports

Centrix Consumer Credit Reports help you make informed decisions about new and existing customers. You’ll be able to view payment defaults, company affiliations, insolvency records, drivers licence verification, and court fines. Depending on your level of access reports can also include the dates accounts were opened and repayment history along with the account type (for example, a credit card, mortgage, or Buy Now Pay Later account), credit limit or amount owing, and account status. . You’ll also receive an easy-to-read credit score that provides a snapshot of an individual’s creditworthiness – the lower the number, the higher the risk.

Business Credit Reports

Centrix Business Credit Reports give you key insights to enable your risk assessment for new account applications and new supplier arrangements. The reports give you deep insights into a company’s past credit behaviour, a summary of frequency and time frames of credit enquiries, type of accounts and/or dollar value businesses have previously applied for, delivered in an easy-to-read format.  

Reports feature a credit score – a summary of the information in the report, designed to provide a snapshot of a company’s creditworthiness. The credit score helps you predict the likelihood of businesses defaulting or failing in the next 12-24 months.The lower the number, the higher the risk. By having this information in advance, you can protect future cash flow.        

 Get credit reports online

To get a credit report and access the credit score and creditworthiness rating of a person or business before extending credit, visit https://www.centrix.co.nz/get-reports/

Every business has a credit score – the higher the score, the greater your cashflow protection.