Improving your business credit score can provide a number of benefits to your business in the long run. You will be able to save money on interest and be approved more easily for financing when you need it. Here are a few proven strategies for improving your business credit score.

1. Pay down Balances

One of the best ways to lower your business credit score is to pay down outstanding balances on your accounts. One of the major criteria that the credit bureaus use to determine your credit score is the amount of money that you have on your accounts. If a large percentage of your available credit is used up, this is going to negatively affect your credit score. By paying down the balances, you will free up more of your credit lines which reflects positively on you as a business. It shows the credit bureaus that you can have credit lines open without using them, which demonstrates restraint on your part. Make every effort that you can to apply extra cash to paying off balances early.

2. Make On-Time Payments

Another strategy that you can use to significantly improve your business credit score is to make your payments on time. Many people do not realize the impact that making payments has to your credit score. However, this might be the most important factor when it comes to determining your score. Every month your creditors are going to report your payment to the credit bureaus. If you are late on your payment, they will report it as such to the bureaus. If you are continuously late, this is going to seriously negatively impact your score overall.

3. Increase Credit Limits

Something else that you can do to help move up your score is increasing your credit limits. Call all of your credit card companies and other accounts to see if they are willing to bump up your credit line. When you do this, this is going to increase the amount of available credit that you have open. This will work in tandem with paying down the balances on your cards to create as much open credit as possible. The more open credit that you have on your file, the more your credit score is going to increase with the bureaus.

4. Closing Accounts

Many people feel that they should immediately close out an account after they have paid it off. However, this is not necessarily always in your best interest. If you have a good payment history with a particular company, you may want to leave the account open even if you do not have any balances on it. Credit bureaus look at how long you have had accounts open when determining your credit score. If you can hang onto the card that you have had the longest, it will increase the amount of time that you have been a creditor. This will work to better your credit score overall and improve your chances of getting credit in the future.

Did you find this article helpful?

Compare Credit Cards

Business Credit Cards