Business credit scores explained

What are the main business credit scores?

PAYDEX from Dun and Bradstreet scores how promptly you pay suppliers, from 0 to 100; 80 means you pay on terms and higher means you pay early. Experian's Intelliscore Plus predicts the chance of serious delinquency, 1 to 100 in its original form, with 76 and above considered low risk; a newer version uses a 300 to 850 scale.

FICO SBSS, the Small Business Scoring Service, is different: it blends your business credit data with the personal credit of the owners and the business's financials into one score from 0 to 300. The SBA uses it to prescreen its smaller 7(a) loans, and many banks use it for loans under $1 million.

What is the FICO SBSS score and the 155 cutoff?

FICO SBSS runs from 0 to 300, and the SBA requires a minimum of 155 to prescreen applications for its smaller 7(a) loans. A score under 155 does not mean an automatic decline, but the lender has to underwrite the file manually and many will not.

You cannot buy your own SBSS score; lenders pull it. It weighs the owners' personal credit heavily, especially for young businesses with thin business files, so a strong personal score and a clean business payment history both lift it. If you are planning an SBA 7(a) loan, cleaning up personal credit six months ahead is the most reliable way to raise it.

How does personal credit still matter?

For most loans under $1 million, your personal credit score matters more than any business score. Banks typically want 680 or higher, SBA lenders around 650, online lenders 600, and cash advance companies 500 or so. The reason is the personal guarantee: because you are personally liable, the lender wants to know how you handle your own debts.

Lenders look beyond the number at recent late payments, high card utilization, collections, bankruptcies and recent inquiries. A 700 score with a 60 day late payment last month looks worse than a 660 with nothing late in three years. Bad credit business loans covers what is available under 600, and business loan requirements shows the typical floors by lender.

Which scores does each lender actually check?

Banks check personal credit from the consumer bureaus, pull a business credit report from Dun and Bradstreet or Experian, and often use FICO SBSS. SBA lenders check personal credit and SBSS. Online lenders check personal credit, usually with a soft pull first, and read your bank statements; most do not pull a business report. Cash advance companies rely on bank statements and a soft personal pull.

Equipment lenders check personal credit and sometimes PAYDEX, and they care about the equipment's value as much as either. Factoring companies check your customers' credit more than yours. Vendors who offer net terms check PAYDEX and Intelliscore, which is where business credit matters most day to day.

How do you build business credit?

Get a DUNS number from Dun and Bradstreet (it is free), make sure your business has an EIN and a business bank account, and open accounts with suppliers that report payments to the business bureaus (office supply, fuel and telecom vendors are common). Pay them early; PAYDEX only rises above 80 if you pay before the due date. Add a business credit card that reports to the business bureaus and keep the balance low.

Check your business reports once a year for errors and dispute them. Business credit takes 6 to 12 months to establish and a few years to become strong. A small equipment loan that reports and is repaid cleanly builds the track record larger lenders look for.

What hurts a business credit score?

Late payments to vendors hurt most, because payment history drives all three scores. Tax liens, judgments, UCC filings on multiple loans, high utilization on business cards, and many recent inquiries also lower scores. For FICO SBSS, the owners' personal credit problems pull the score down even when the business pays everyone on time.

Two things surprise owners. First, having no reported accounts gives you no score at all, which some lenders treat like a low one. Second, a clean closed account keeps helping, so keep two or three reporting accounts open and active. You can apply here with whatever history you have, or ask your AI assistant to apply through our MCP server; see the agents hub.