Although more lenders are willing to give small businesses a chance than ever before, it is still the case that lots of startups and SMEs still struggle to get access to the credit they require.
If you’re in that boat right now, don’t fret because there are a number of things you can do to start making your business small business more creditworthy right now...
Ensure Business and Personal Accounts are SeparatePerhaps, the best thing you can do to increase your company’s creditworthiness right now is to ensure that your business accounts and your personal accounts are not in any way mixed up. Why? Because if they are intermingled, then your personal debts could block you from getting a business loan and vice versa - it really isn’t a good idea, especially now that basic business accounts are so affordable.
Find Out Your Business Credit ScoreJust like you have a personal credit score, your company also has its own credit score and just how you might need to do a fast credit repair job on your personal score, you may need to do the same on your business score too. Of course, you can’t do this until you know what your score is, so find out and take things from there.
Check Your Report for ErrorsWhile we’re on the subject of checking your company’s credit report, this isn’t just something that you should do once and then forget about; you should be checking it at least every three months, and when I say checking it, I mean going over it with a fine tooth comb. Why? You’d be surprised how many errors can be made on credit reports and how easy it is for a simple mistake to ruin your creditworthiness - don’t let it happen. Apply for a Business Credit Card
It is often easier to obtain a company credit card than it is a loan from the bank, and doing so is a good way of building a positive credit history for your new company, especially if you actually make sure you pay it off on time each month - to do otherwise would be counterproductive. Not only that but you can earn air miles, points, and rewards if you choose the right card, which will certainly help you out financially when your business is in need.
Pay Your Invoices On TimeIf you pay your creditors on time, or even early, then not only will it gain their trust, which means they may be more likely to extend a line of credit to you and be more willing to act as a credit reference for your company, but you might even get a small discount thrown into the bargain too.
The bottom line: Sometimes, it just takes a little time for a company to establish itself and prove it’s creditworthiness, but doing all of the above is sure to speed things up a little, or maybe even a lot. So, it is well worth taking the time to do them, the future of your company might just depend on it!