Why does your commercial credit scores mean a lot?

Commercial Credit score is really important for the whole business process. Using this tool well will make your business move smoothly in expanding business scope. Just like Dun & Bradstreet, Experian, & Equifax, eGTCP has its unique advantages in Chinese supplier’s credit status monitoring.

Understanding Commercial Credit Scores & Reports

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The concept of creditworthiness dates back to the early 1800s, ever since there have been lenders there has been a need to assess a borrower’s risk level. It was not until the 1970’s, when the Fair Credit Reporting Act (FCRA) was passed, that borrowers were protected from lender bias having an impact on their likelihood of loan approval and rates. Consumers are offered a variety of protections and security under the FCRA of 1970 and its amendments in the 1990’s and 2003, but businesses and corporations were left out of the FCRA. To this day, businesses are not protected under the FCRA and business credit is highly unregulated. Therefore, business owners can experience limited success and stunted growth if business credit profiles, scores, and indexes go unmanaged.

The Bureaus – Dun & Bradstreet, Experian, & Equifax

Dun & Bradstreet, Experian, and Equifax have roots that date back to before the turn of the century. All three maintain a global database, separate from one another, that contains information and data on millions of businesses and consumers.

According to D&B: Their commercial credit scores “…predict the likelihood of a business paying its bills in a severely delinquent manner (91 days or more past terms), obtaining legal relief from its creditors or ceasing operations without paying all creditors in full over the next 12 months. D&B defines severe delinquency as a business with at least 10% of its payments 91 days or more past due, based on the information in D&B’s commercial database. The score ranges from 101 to 670, where 101 represents the highest probability and 670 represents the lowest possibility of delinquency.“

Risk Class – “Separates businesses into five distinct risk groups where 1 represents businesses that have the lowest probability of severe delinquency, and 5 represents businesses with the highest probability. The credit score class allows you to quickly segment new and existing accounts according to risk to determine appropriate marketing or credit policies.”
Percentile Norms – “Represent the average score and percentile for all scorable companies with similar demographics, and they can be used to benchmark where the company stands relative to the norm for its peer group.”
Distribution of Commercial Credit Score Risk Class

“The table below illustrates the distribution of the Commercial Credit Score Class in the Dun & Bradstreet Business Universe. In addition, this table displays their associated Percentile Ranking and Score, along with the Delinquency Rate.”

What to Look for In a Business Credit Repair / Building Company?

Businesses need to be more proactive – just because credit is not affecting you today does not mean it should be pushed off until tomorrow. Most businesses have a plan for eventual expansion and will need a strong and established business credit profile on their side in order to gain access to loans, leases, lines of credit, new partnerships/accounts, and government bids. Pushing your business credit down on your ‘to-do list’ is only going to further frustration when it comes time for growth.

Each business credit reports includes scores and indexes that are used to assess and predict a business financial standing and payment habits.

eGTCP has years of experience in fixing, correcting, and monitoring business credit profiles from all three of the major credit bureaus. 

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