How to Ensure a High Credit Score for Your SME

As the owner of a Small & Medium-sized Enterprise (SME), you channel all your resources into your organization. All business ideas and strategies are directed towards its growth into a larger setup, both in terms of revenue and market size. With limited resources at disposal, SMEs end up juggling a lot of things, often ignoring important stuff like managing their business credit score.

 

A business credit score is identical to a personal credit score. While evaluating an individual’s credit score, the credit reporting agency takes into consideration different factors such as one’s credit card statement, loan repayment, monthly EMI payments etc. Similar exercise is undertaken for businesses. In the calculation of your business credit score, the credit worthiness is evaluated on basis of different factors such as outstanding balance, trade history, payment records etc. SMEs should always aim to have a credit score more than 750, which enables easy loan procurement.

 

It is important for a SME to have a high business credit score. Let us understand why. After a business comes into existence and passes the initial survival test, growth is the next big challenge. As the business expands, the capital requirement also increases. One needs to secure one’s finances before the business spirals towards bankruptcy. This is where a good credit score comes into play.

 

Following these simple tips and taking strategic business decisions accordingly can not only make your credit score better, but also lead to better operational efficiencies:


Other Pointers That May Help You Get Past Underwriters

 

 

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