Credit Reporting for Small Businesses
Like personal consumer credit scorecards, business credit reporting is meant to assist lenders in identifying credit risk posed by a borrower. With tightening business lending standards by major creditors, understanding the way the availability and quality of business credit affects the bottom line is key. For businesses and business owners, being listed with business credit agency is vital to growth for several crucial reasons.
Separation of Personal and Business Assets
Consumers with healthy credit scores may be tempted to take out loans to support their businesses, but this leads to vulnerability if they default on the loans. By having a business listed as a separate credit entity capable of being lent credit, personal assets are protected in case of bankruptcy.
Access to Government Contracts
The U.S. Federal Government has long relied on business credit agencies to offer critical data and insights so as to facilitate evaluations and awarding of business contracts.
Managing Credit Strategies
On both the lender and borrower side, data aggregation services can help guide best business practices. Credit reports offer insights into data related to a business’ payment history, business conditions and UCC filings, allowing partners to make informed and financially secure decisions as to who they work with.
Marketing
Business credit reporting agencies offer the opportunity to create targeted business prospect lists based on data—offering up-to-date business leads tied to behavioral scorecards.
Quicker and Improved Debt Recovery
Reporting payment and debt history alerts your business partners that debts are being accounted for as a matter of record. Businesses are far more likely to not default on accounts if they know that payment history is being reported to a business credit reporting agency.
GDS Link’s state-of-the-art credit risk software offers our customers the most detailed insights to help guide their growth. Call us today to learn more.
