How to check your business credit score (for free) & how to build business credit

What are business credit scores?

A business credit score serves as a snapshot of your company’s financial health and creditworthiness. Just as personal credit scores affect an individual’s ability to borrow money, business credit scores influence how lenders, vendors, and partners perceive your startup’s financial health. Typically ranging from 0 to 100, a higher score means better credibility and financial stability.

Why should founders care about business credit scores?

A good business credit score isn’t just a nice-to-have—it’s a must-have for startups looking to scale. Here’s why:

Securing funding 

Startups generally rely on external funding to grow. Banks and alternative lenders often use business credit scores as a deciding factor for approving loans. A high score signals to lenders that your startup is financially responsible and capable of repaying debt, increasing your chances of securing better terms and lower interest rates.

Building credibility

A strong credit score builds trust with vendors, suppliers, and partners. Vendors are more likely to offer favorable payment terms when they see that your business has a reliable credit history. This credibility can also help establish long-term partnerships that support your startup’s success.

Separating personal and business finances

Building and maintaining a business credit score draws a clear line between your personal and business finances. This separation protects your personal assets and helps your startup stand on its own. It’s beneficial for legal, tax, and liability reasons, and it ensures that personal credit issues don’t interfere with your business’s ability to secure funding when needed.

Opportunities to scale

A strong business credit score allows you to secure higher credit limits, negotiate better payment terms, and fund large-scale projects. It also positions your company to attract investors who prioritize businesses with proven financial responsibility.

Reducing risk in partnerships 

Many potential partners —such as suppliers, distributors, and landlords—may review your business credit score before entering into agreements. A solid score demonstrates that your startup is a trustworthy and low-risk partner, opening doors to opportunities that might otherwise be unavailable.

How do I get business credit?

To establish business credit, your company needs to be officially recognized.

Start by choosing a business structure like an LLC or corporation, which separates your personal and business finances. Then, you’ll need to register your business with your state.

After registering, apply for an Employer Identification Number (EIN) from the IRS. This is like a Social Security number for your business and is necessary for tax filings and financial accounts.

Once you have your EIN, you’re ready to open a business bank account, which is simply a checking account in your business’s name. You’ll use this account for all business-related transactions, such as paying vendors and receiving customer payments.

Finally, you’ll apply for a business credit card and begin working with vendors that report to credit bureaus to start building credit. 

How is my business credit score determined?

Business credit scores are calculated based on several factors that reflect your company’s financial health and payment behavior. 

While the exact scoring formulas vary by agency, here are the most common elements that determine your score:

1. Payment history

Your payment history is the most critical factor in determining your business credit score. Timely payments to vendors, lenders, and creditors indicate reliability, while late or missed payments can significantly lower your score.

2. Credit utilization ratio

This measures how much of your available credit you’re using. A lower credit utilization ratio—typically below 30%—is seen as a sign of responsible credit management. High utilization may signal financial strain.

3. Length of credit history

The longer your business has been using credit, the better. A longer credit history provides more data for lenders to evaluate, showcasing your business's stability and financial consistency.

4. Credit mix

Using a variety of credit types—such as business loans, credit cards, and vendor credit—can positively impact your score. It demonstrates that your business can manage different financial obligations effectively.

5. Public records

Any liens, bankruptcies, or judgments against your business are red flags for creditors and significantly lower your credit score. Keeping your business clear of legal and financial disputes is crucial.

6. Number of credit inquiries

Each time you apply for credit, a hard inquiry is made on your file. Too many inquiries within a short time can lower your score, as it may indicate financial instability or over-reliance on credit.

7. Trade credit activity

If you work with suppliers or vendors, their payment terms and how well you make your payments are often reported to credit bureaus. Paying invoices early or on time improves your score.

How to check your business credit score for free

Thankfully, there are tools available to check your business credit score for free. Although most credit score agencies charge for detailed reports, the following platforms provide business owners with free insights: 

Nav 

Nav is a one-stop platform offering free access to your business credit summary from major bureaus like Experian, Dun & Bradstreet, and Equifax. They also offer a paid version that starts at $29.99 to gain access to more detailed reports about your score from each credit bureau. 

Credit Signal 

CreditSignal is a free service that alerts you to changes in your Dun & Bradstreet credit scores and ratings, including the Paydex Score, delinquency predictor score, financial stress score, and supplier evaluation risk rating. While detailed reports require a paid subscription, the free version alerts you to credit score shifts.

Key providers of business credit scores

Not all credit scores are created equal. Each business credit bureau evaluates your creditworthiness through its own unique lens, offering different scoring models and features. Here’s what you need to know about each one:

1. Dun & Bradstreet (D&B)

• What they focus on: Dun & Bradstreet zeroes in on your payment history, which means consistent, on-time payments are key to building a strong score with them.
• Score range: 1–100, with scores of 80 or higher signaling excellent creditworthiness.
• Unique features:
  • To track your credit, you’ll need a D-U-N-S Number, a unique identifier for your business. Getting this number is free, and it’s often required for government contracts and certain vendor accounts.
  • D&B’s PAYDEX Score is based entirely on how promptly you pay your bills.
• Cost: While their CreditSignal tool offers free alerts for score changes, accessing detailed reports requires a paid plan, starting at $39/month with CreditMonitor.‍

Experian Business

• What they focus on: Experian evaluates a combination of payment trends, outstanding debt, and public records like bankruptcies or liens to assess your financial stability.
• Score range: 1–100, with higher scores indicating lower financial risk.
• Unique features:
  • Experian blends trade credit data with publicly available financial records to create a comprehensive credit profile.
  • Their Intelliscore Plus model predicts the likelihood of your business falling behind on payments over the next 12 months.
• Cost: Experian’s basic CreditScore Report costs $39.95, while their more detailed ProfilePlus Report is available for $49.95. For ongoing monitoring and alerts, their Business Credit Advantage plan is $199/year.

Equifax Business

• What they focus on: Equifax assesses your business’s credit risk and overall financial health, paying particular attention to delinquencies and payment trends.
• Score range: 101–992, offering a unique scoring model that predicts credit risk. They operate on a scale where higher scores are better.
• Unique features:
  • Equifax includes Delinquency Predictors that evaluate the likelihood of your business missing a payment.
  • Their reports combine financial data, public records, and firmographic data (such as company size and industry).

• Cost: Equifax’s pricing isn’t publicly listed, but reports can be obtained by contacting them directly. Their comprehensive analysis appeals to larger organizations or businesses seeking in-depth credit insights.

Common challenges startups face with business credit

Building business credit can feel like navigating uncharted territory, especially for startups juggling multiple priorities. It’s not just about knowing where to start but also overcoming obstacles unique to new businesses. 

Here are some of the key challenges startups often face and how to tackle them head-on:

1. Separating business and personal credit

When you’re starting out, it can be tempting to lean on your personal credit to fund business expenses. While this might work short-term, it quickly blurs the line between personal and business finances. Repeatedly mixing finances can hurt your business's ability to establish its own credit profile and put your personal finances at risk. 

Instead, consider opening a business bank account and apply for a business credit card early on in your business. Keeping these finances separate from the start will make building your business’s credit easier while protecting your personal financial health. 

2. Lack of access to funding 

For startups without an established credit history, traditional funding options like loans or lines of credit can feel out of reach. Many founders resort to high-interest alternatives, which can strain already tight cash flow.

At the onset, start small. Look for vendor accounts or secured business credit cards that don’t require extensive credit history. Over time, consistent payments can unlock larger funding opportunities.

3. No credit history

Building credit from scratch is like trying to get your first job—you need experience to get the role, but you can’t get experience without the role. Without a credit history, lenders and vendors don’t have enough data to assess your business’s reliability.

To start establishing a credit history, consider working with vendors that report payment activity to credit bureaus. Even small purchases paid on time can help establish your credit footprint.

4. Limited financial literacy

As a startup founder, you juggle many responsibilities, but financial management may not be your strongest skill. A limited understanding of what impacts your credit score or how to monitor it can hinder your business's progress.

Try using tools like Nav or CreditSignal to monitor your credit and learn how scores are calculated. Consider financial literacy workshops or consulting with a finance expert to bridge gaps in your financial knowledge. 

5. Sky-high interest rates

Without a proven credit history, many startups face high interest rates on loans or credit cards. These rates can quickly eat into your bottom line, making it harder to maintain positive cash flow and reinvest in growth.

When looking for options, shop around for credit products or corporate cards designed for new businesses. Compare rates and terms carefully, and use a business credit card responsibly to demonstrate your ability to manage debt.

6. Maintaining cash flow 

Late payments, inconsistent revenue streams, and unexpected expenses can wreak havoc on your cash flow, making it harder to pay bills on time—a key factor in building strong credit.

Be sure to stay on top of your cash flow with tools or software that track income and expenses in real-time. Automate bill payments whenever possible to avoid late fees and protect your credit.

While these challenges can feel overwhelming, they’re not insurmountable. By addressing them early, you’ll set your business on a path to financial stability, better funding opportunities, and long-term growth.

Remember: Every established business once started from zero. It’s about taking deliberate, strategic steps to build your credit and position your startup for success.

Strategies for building and improving business credit for startups

Establishing and improving business credit doesn’t happen overnight, but with the right strategies, startups can build a strong financial foundation. We’ve put together a few actionable insights you can implement now:

Pay bills on time

This may seem like an obvious insight, but consistently paying bills on time is the most important factor for building business credit. Late or missed payments damage your credit score and signal risk to lenders and vendors. 

If possible, automate recurring bills to reduce the risk of missed payments and late fees. You can check if your bank or credit card provider offers auto-pay options and activate them for all fixed payments.

Open a business credit card 

A business credit card is one of the easiest ways to establish and grow credit, provided it reports your payment activity to credit bureaus. When searching for cards, avoid those with excessive fees or high interest rates. Pay off your balance monthly to build credit without accumulating debt. 

Establish good relationships with vendors

Vendors and suppliers are critical in building business credit, especially for startups. Many offer trade credit, which allows you to purchase goods or services and defer payment for a set period. This creates an opportunity to manage cash flow and establish a positive credit history when payments are made on time.

Vendors can serve as trade references when applying for loans or larger credit lines. A strong relationship with your vendors adds credibility and supports your creditworthiness.

Maintain a low credit utilization ratio

Credit utilization measures how much of your available credit you’re using. Keeping this ratio below 30% signals financial stability to lenders and boosts your credit score.

Lenders and credit bureaus generally see high utilization rates as a red flag. It suggests that your business may be over-reliant on credit, which could indicate financial strain. On the other hand, a low utilization ratio shows that your business has room to borrow if needed and is less likely to default on its obligations. This can lead to better credit terms and higher credit scores.

For example, let’s say you have a credit card with a $10,000 limit. Keeping your balance below $3,000 would be less than 30% of your credit utilization ratio. This would positively impact your credit score.

However, let’s say that your balance for the past month has been around $7,000. This would mean you’re using over 70% of your available credit. Even if you pay it off each month, the high balance during the reporting period can harm your score.

To maintain your ratio, keep track of your credit card balances to ensure they stay within the recommended range.  If your spending needs are higher, consider requesting a limit increase on your credit card. For instance, if your credit limit increases to $20,000, maintaining the same $3,000 balance lowers your utilization to 15%.

Use credit strategically 

A business credit card can be a powerful tool for growth when used strategically. Using your credit card for predictable, recurring expenses—such as office supplies, software subscriptions, or utility bills—helps establish consistent payment activity. These transactions are easy to budget for, making paying off the balance in full each month simpler.

Keep track of all transactions to ensure your spending aligns with your budget, and avoid maxing out your credit cards, even temporarily. High balances can hurt your credit score, even if you plan to pay them off at the end of the billing cycle.

Regularly monitor your credit

Monitoring your business credit reports allows you to spot errors or signs of fraud early and take corrective action. You can see how positive financial actions, like paying bills on time or maintaining low credit utilization, impact your score over time. It also gives you a clearer picture of where you stand when seeking funding or credit.

Final thoughts on building business credit

Building and maintaining a strong business credit profile is one of the smartest investments you can make as a startup founder. It helps you access funding while creating a foundation for long-term growth and financial stability. 

The steps are simple but impactful—pay your bills on time, maintain low credit utilization, establish strong relationships with vendors, and use credit checkers to monitor your progress. With consistent effort, your business credit score will become a powerful asset that opens doors to better funding options, partnerships, and growth opportunities.

Conclusion: Take the next step with Rho

Keeping tabs on your business credit is essential for protecting your financial health. When you manage your business credit wisely, you can build your credit profile and receive more favorable terms with vendors, and unlock better card options to fuel your growth.

To start, look for a card option that incentivizes strategic spending to help you maintain control over your cash flow.

Rho Corporate Credit Cards offers you exactly that. With the Rho card, you can benefit from features like spend limits and automated accounting that help you maintain compliance and make better financial decisions, eliminating unnecessary spend in the process.

Apply now to start enjoying the benefits of Rho Corporate Credit Cards today.