Have you heard of the PAYDEX Business Credit Score?
PAYDEX score is the main credit score used in business formulated by Dun and Bradstreet.
It is a way of evaluating the lending risk of a business. It works the same way as to how a consumer credit score considers the individual credit risk of a consumer.
According to Dun & Bradstreet, The D&B PAYDEX Score is D&B’s unique dollar-weighted numerical indicator of how a firm paid its bills over the past year, based on trade experiences reported to D&B by various vendors.
A business PAYDEX credit score is a big contrast to an individual FICO consumer credit score.
While a consumer FICO credit scores range from 350-850, the PAYDEX Score ranges from 0-100 and 100 being the highest score in the range.
Several factors affect individual credit scores. However, the PAYDEX score is only affected by a single factor. That’s if a business settles its dues on time to its suppliers and creditors abiding by the agreed-upon payment terms.
Usually, lenders and suppliers are opting for businesses having a score of 70 and higher. Having a score of 80 or more is excellent.
If you’re an entrepreneur, your PAYDEX score is extremely important in setting up new credit and pursuing building a credit limit that exceeds $100,000.
A positive PAYDEX credit score will only take up to 60 days to be established. Primarily, you need to get a DUNS Number. A DUNS Number is a nine-digit business identifying number used by Dun & Bradstreet.
Once you have your DUNS Number, you can now find a merchant who will increase your credit. Then, you should report the provided credit to Dun & Bradstreet.
Once you’ve got a positive business credit report from Dun & Bradstreet, a positive PAYDEX score then follows.
You can now apply for more business credit and you can frequently use it. Just make sure you pay your dues on time to increase your score to 80 or more.
As you can see, it’s easy and quick to obtain a positive PAYDEX credit score.
Remember that when you pay your dues punctually, your credit scores will increase eventually, and qualifying for credit in your business name is within your reach.