Unlike consumer credit scores which are handled by three main reporting bureaus, business’ information is collected by four different bureaus. Here is an overview of how these scores are determined.
FICO’s Small Business Scoring System draws data from your business’ credit history as well their principal’s consumer credit information. Scores range from 0 (poor) to 300 (excellent). This business credit score is typically utilized by lenders making determinations about eligibility for a small business loan.
Experian is one of the largest consumer and business credit reporting bureaus, and it accesses its information from numerous public sources rather than only the information that is reported by creditors and businesses. It utilizes 800 separate data elements in determining a business credit score including outstanding obligations and payment histories.
Dunn & Bradstreet
This credit reporting bureau integrates three different types of scoring criteria to evaluate business’ credit history and the likelihood that it will be able to meet its obligations.
- A Delinquency Predictor Score is intended to analyze the likelihood of a business defaulting on a payment obligation. DPS scores range from 110 (poor) to 670 (excellent). In addition, your business is categorized with a Delinquency Predictor Risk Class between 1 (poor) and 5 (excellent) as well as a Delinquency Predictor Percentile between 1 and 100, which ranks you among other similarly situated businesses. In the case of DPP, the poorer the number the better you’ll be viewed in relation to comparable businesses.
- A Financial Stress Score is a predictive evaluator gauging the likelihood of your business being overburdened financially within the next twelve months based on its outstanding financial obligations. FSS is scaled between 1001 (poor) and 1875 (excellent). It will be assigned a Financial Stress Class between 1 (poor) and 5 (excellent) as well as a Financial Stress Percentile between 1 and 100, ranking you against other businesses.
- A PAYDEX © score evaluates your business’ ability to pay bills timely and consistently. This evaluation is based on payment history, and the amount of payments can heavily influence your business credit score, so obligations on a smaller line credit of credit will weigh less than larger obligations.
Equifax uses a variety of ranking elements to assess a business’ credit. A Payment Index between 1 (poor) and 100 (excellent) ranks your business’ ability to make timely payments, and a Delinquency Index ranks the likelihood that your business will default on a credit or loan obligation. Lastly, Equifax assigns an overall business risk class between 1 (excellent) and 5 (poor).