How Paydex Score Helps Your Business Financing
If you own a business, you should be interested in learning about Paydex Score and how it can affect your business
. What is a Paydex Score? How can you keep your Paydex Score in an excellent standing? Is it really important to keep your Paydex on a high level? What can you do to improve your business credit? Let's answer these questions one by one.Your Paydex Score Helps Your Business Financing
You may already be familiar with your personal credit report and how your credit score is calculated. For business owners and enterprises, the Paydex is the equivalent of your personal credit score or better known as FICO score. If you've already signed your business with Dun & Bradstreet (business credit bureau), you are already building a separate credit history for your business.
Your Paydex Score is the number you get from Dun & Bradstreet. This score is included in your business credit report for your prospective creditors to see. A Paydex score ranges from a low of 80 to a high of 90 to 100. Meanwhile, a score of 70 and below are considered as poor and sends out a negative impression to lenders.
The calculation of the score is based on your ability to make payments. Being late in submitting payments can definitely pull down your Paydex score. On the other hand, paying your bills on time or earlier than your due date ensures a higher Paydex score. In fact, the best way to increase your business's credit score is to pay your bills earlier than the scheduled due of payment.
As much as possible, don't wait until the last day of your payment schedule arrives. To be sure that you won't get late or that you won't miss a single payment, it's wise to make the early submission of payment a habit.
Your Paydex Score - Why You Should Be Concerned
Can your Paydex Score really make a difference in how business loan lenders see your company? Since your business credit score is calculated based upon your payment habits, lenders can immediately conclude whether you are a responsible borrower or not. Obviously, a low score would raise the alarm for lenders while a high score would make an impressive impact on your potential lenders.
Consequently, it would be more difficult for you to get approved for loans or business credit cards. Although, there are credit card companies that offer credit cards for businesses with bad credit, these often come with higher interest rates, lower credit limit and literally more costs. Generally, credit cards with the best deals require good to excellent business credit.
The ideal Paydex Score is 90 to 100 so if your current score is below that average, you should certainly work on raising that number before even thinking of applying for a loan or a small business credit card. By improving your Paydex score, you guarantee your chance of getting approved easily and getting only the best credit card and business loan deals in the market.
How Paydex Score Helps Your Business Financing
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