How to Build Business Credit: A Step-by-Step Guide for Small Business Owners
Strong business credit can help your company qualify for better financing, supplier terms, and business credit cards, and it keeps your business finances separate from your personal credit. Here is how it works, in plain English, from our bilingual team in Bakersfield.
Business credit vs. personal credit
Your personal credit is tied to your Social Security number. Business credit is tied to your business and its Employer Identification Number (EIN). Business credit bureaus track how your company pays its bills, and lenders and suppliers use those reports to decide whether to extend credit.
Dun & Bradstreet
Known for the PAYDEX score, which reflects how on time your business pays the vendors that report to it.
Experian Business
Business credit reports and scores used by many lenders and suppliers.
Equifax Business
Business credit reports that include payment history and public records.
8 steps to build business credit
Work through these in order. Each step includes free, official links.
Make your business official
Register your business with your state (for example, as an LLC or corporation) and get any local licenses you need. A registered entity looks more established to lenders.
Get a free EIN
Apply for an Employer Identification Number directly from the IRS. It is free; you do not need to pay a third party for it.
Open a business bank account
Keep business money separate from personal money. Lenders want to see business revenue flowing through a business account. Choose an FDIC-insured bank or an NCUA-insured credit union.
Use consistent business contact information
Use the exact same business name, address, and phone number everywhere: your state registration, bank, IRS records, website, and listings. Mismatched details can cause problems when credit bureaus and lenders verify your business.
Get a D-U-N-S Number
Dun & Bradstreet assigns a free D-U-N-S Number that helps establish your business credit file. Paid options are offered, but the basic number is free.
Open accounts that report business payments
Start with suppliers that offer payment terms (such as “net 30”) and report to the business credit bureaus, then add a business credit card. Before you open any account, ask whether it reports to the business bureaus and whether it requires a personal guarantee.
Pay on time or early, every time
Payment history is the foundation of business credit. Some business scores, like PAYDEX, reward paying before the due date. Set up reminders or autopay, and keep card balances low compared with your limits.
Check your business credit reports
Review your business reports and correct errors, such as wrong addresses, closed accounts reported as open, or payments reported late in error.
Where to get your business credit reports
Each business credit bureau (Dun & Bradstreet, Experian, and Equifax) keeps its own file on your company, so it is a good idea to check more than one. Plans and prices are set by each company and can change, so confirm current terms before you sign up.
Nav
A free account shows summaries of your business credit from Dun & Bradstreet and Experian, plus your personal credit, in one place. Paid plans add full reports and more data.
(affiliate link)
Dun & Bradstreet Credit Insights
See your D&B scores and ratings, including PAYDEX. A free plan is available, with paid plans for more detail and monitoring.
Experian Business
Buy a one-time business credit report on your own company, or choose ongoing monitoring.
eCredable Business
A monthly subscription that reports eligible business bills, such as utilities and services, to Dun & Bradstreet, Equifax, and Experian to help build your business credit files.
Creditsafe
Business credit reports on your company and the companies you do business with, with a free trial.
Tools and accounts to consider
Well-known options business owners often use. Features, fees, and approval requirements are set by each company and can change, so always confirm current terms and ask whether the account reports to the business credit bureaus before you apply.
Supplier accounts with “net 30” terms
Buy now and pay within 30 days. Paying early or on time can help start your business credit file. Buy only what your business actually needs.
Uline
Shipping, packaging, and office supplies. Uline has said it reports payments to Dun & Bradstreet and Experian Business, and that it does not pull the owner’s personal credit.
Quill
Office supplies, cleaning, and break-room products, with invoice terms for business customers.
Business credit cards for building or rebuilding
Bank of America secured business card
A secured business card from a major bank. A refundable deposit (at least $1,000) sets your limit, with no annual fee.
Capital One Spark 1% Classic
Designed for business owners with fair credit. No annual fee and 1% cash back on purchases.
Lili BusinessBuild
A business banking program with a card designed to report payments to Dun & Bradstreet. The program has a monthly fee.
Once your credit is stronger
Chase Ink Business Unlimited
A no-annual-fee business card with unlimited 1.5% cash back. Usually requires good credit.
SoFi credit cards
SoFi offers personal cash-back cards, including an Unlimited 2% card. These are personal cards, not business cards, and approval depends on your personal credit.
Check your personal credit, too
Because most business financing still looks at the owner’s personal credit, review your personal reports before you apply.
AnnualCreditReport.com
The official site for free personal credit reports from Equifax, Experian, and TransUnion.
Credit Hero Score
Personal three-bureau credit reports and scores with monitoring, one of the services our team uses to review clients’ credit.
(affiliate link)
Free help for small businesses
Central California SBDC
Free one-on-one business consulting and workshops, including for Kern County businesses.
Kern County Hispanic Chamber
Networking, workshops, and a business academy in English and Spanish.
Common mistakes to avoid
- Mixing personal and business expenses in the same account
- Using different business names or addresses in different places
- Paying someone to “sell” you instant business credit or tradelines
- Applying for many accounts at once
- Ignoring your personal credit while you build business credit
Ready to Explore Business Funding?
See SBA 7(a) loans, term loans, and lines of credit through our lending partner, SmartBiz Bank, and check your funding readiness in two minutes. Approval is not guaranteed.
Visit the Business Funding CenterWhy work with Maximum Score Builders?
Business credit starts with the owner. We help you get the personal side right, so your business has a stronger foundation when you apply.
Your personal credit, reviewed
Most new business financing checks your personal credit. We review all three of your personal reports with you and help you dispute information that is inaccurate, incomplete, or unverifiable.
One plan for personal and business
We map out the steps on this page for your situation, in the right order, so you are not guessing what to do next.
Honest guidance
We tell you what you can do yourself for free, and we never promise score increases, deletions, or approvals.
Local and bilingual
A Bakersfield team serving business owners in English and Spanish, and a member of the Kern County Hispanic Chamber and the Greater Bakersfield Chamber of Commerce.
Funding referrals when you are ready
When your profile is ready, we can refer you to third-party funding partners. We are not a lender, approval is decided by each lender, and we may receive a referral fee.
No advance fees
Your consultation is free, and we never charge fees before services are performed.
Building a business in Kern County?
Free consultation in English or Spanish. We will review your situation and help you understand your options, honestly.
This page is for educational purposes only and is not legal, tax, accounting, or financial advice. Credit bureau scoring models, products, and lender requirements are set by third parties and can change. Approval for any credit or funding is decided by the lender or supplier, results vary, and no specific outcome is guaranteed. Maximum Score Builders is not a lender. Some links are affiliate links, and Maximum Score Builders may receive compensation if you sign up. Company names are trademarks of their respective owners and are used for identification only.
Maximum Productions LLC, DBA Maximum Score Builders · 4646 Wilson Road, Suite 101, Bakersfield, CA 93309 · (661) 505-8085