Business credit reports are a summary of your business’s credit status and payment history. Anyone who extends credit to your business can access your business credit report, such as utility companies, banks, and suppliers.
The report is a vital tool to help businesses decide whether to offer your business credit, based on your financial track record and potential risk of payment default. The report features a credit score that indicates how likely your business is to pay its bills on time. The higher your business’s credit score, the more likely you will be able to access products and services on credit.
What information is in my business credit report?
Your business credit report details your current credit situation and the status of your accounts.
A Centrix business credit report includes your company’s current credit score, detailed account payment information, as well as any defaults, insolvencies and judgements. Personal Property Security Register (PPSR) records list the company’s assets secured against existing loans.
Other information includes your trading name, company number, shareholdings, directors and other relevant information about your company’s structure.
Banks, credit cards and other credit providers
Anytime your business applies for a loan or a new credit facility such as a credit card, the bank or other credit provider will access your business credit report. They may make a quick decision based on your credit score but will also be looking for any red flags such as recent missed payments, which could lead to your credit application being denied.
The number of recent credit applications will also be an indication of how well you’re managing your finances – so keeping your business’s credit applications to a minimum is important.
Power, phone, and internet companies provide your business with services on credit that you pay for in arrears each month. Before a telco company connects your mobile phone, or before a power company provides your new premises with service, they may check your business credit report.
If you have outstanding payments or have defaulted on an account to another utility company, you may be declined a connection by a new provider. This can make it very difficult to get the basic services you need to be able to operate, so it’s important to keep your accounts with utility companies in good order.
Suppliers and customers
If your suppliers let your business order goods and services and pay at a later date, then they’re offering you a form of credit. They will want to make sure that you can pay your accounts on time, so they may access your business credit report to look at your credit score and payment history.
Your customers may also be interested in your financial position and look at your business credit report. That’s because they want to be assured of their supply chain continuity, and work with suppliers who have a healthy financial position, an indicator of future longevity.
Check your credit report online
To get a copy of your business credit report and understand your current credit score, visit here.
Every business has a credit score – the higher the score, the greater your cashflow protection.