A Guide to Credit Scores for Businesses

Often small businesses struggle to find the right funding to venture their business. It takes even more time for no security business loans to get through. If you need a small company loan in Australia, the very first step is to obtain your company’s credit score. Questions like, “what does a credit score mean?” or “what is a good credit score?” may arise.

To get answers to these questions and a lot of others, continue reading this blog. 

What Is A Credit Score For A Business?

A business credit index is a statistical indicator of your company’s financial health. Banks and internet lenders utilise this signal to evaluate your loan request and the risk of financing you as an enterprise.

It’s critical to understand your company credit score to select the best loan source for you. Receiving denials from a variety of lenders wastes a lot of time and has a negative influence on your credit score.

How Is a Company’s Credit Score Determined?

If you’re wondering what influences business credit scores, there are several elements to consider. A credit score for a business will consider commercial factors such as:

  • Defaults on trade payables – If you’ve failed on trade payables, it will have a significant influence on your credit rating.
  • Data on your executives – Past foreclosures or court judgments against your directors will have an impact on your company’s credit score.
  • Government Records – Like a private credit score, public records are available to the public. County court judgments and unpaid tax debts might have a negative impact on your credit score.
  • How old is your firm? In most circumstances, newer businesses are perceived to be riskier than those around for a long time.
  • Previous credit inquiries – The amount of credit you’ve requested in the past, and the kinds of loans you’ve sought, will affect the chances of a loan.

How to Boost Your Company’s Credit Score

If you discover you have a poor credit score and want to improve it, the next step is to request a copy of your Equifax credit report. This will almost certainly cost you money, but with your complete report, you’ll be able to see what factors are affecting your credit score.

For instance, if a supplier has a default issue, you could figure out who the provider is and try to fix the problem. Your credit score will improve if the problem is remedied and the mistake is removed.

Paying back your loan liabilities on time while minimising the amount of credit provided to your company can increase your credit score. Growing your business credit by becoming more established, operating for a prolonged period, and repaying your financers on time should all help.

Is a Credit Score Required for a Business Loan?

Online lenders will almost always look at your credit score to receive no security business loans.

However, it’s vital to realise that the financing decision isn’t based just on your company’s credit score. The information needed varies by lender, but they might often look at your financial statement, income statement, and possibly your capital structure. 

For loans under $100,000, only the company’s bank statements are usually necessary; however, loans over $100,000 may necessitate a more thorough examination of the company’s financial accounts.


The topic of small company credit scores has been discussed in this article. Its goal was to inform you about a business credit score and how it affects business credit ratings. Also, keep in mind that online lenders will constantly check small company credit scores. This blog is all you need for any inconsistencies or just more information regarding your business credit score in Australia. 

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