What is a business credit score?

What is a business credit score?

Last updated: 30 June 2021

A business credit score is a numerical indication of the credit risk associated with a business.  Where a personal credit score is calculated using information from an individual person’s credit report, a business credit score is calculated by looking at the credit reporting data associated with a business.

A business credit score is calculated by using a variety of data such as:

  • Company details including information about how long it has been in operation, its structure and its current shareholders;
  • Publicly available information such as court judgements and actions taken against the business by ASIC
  • Information the Personal Property Securities Register has concerning the business’ possessions
  • Credit file information about the business such as credit enquiries and defaults
  • Director information including previous negative marks against the directors of the business.

Lenders will use your business credit score as one data point when assessing your business loan applications. Other information that may be taken into account include cash flow, profit and loss statements, balance sheets and tax returns so the lender can determine whether a business will be able to pay back the loan.