​​Why Business Credit Score Monitoring Matters

Checking your business credit score is a key part of staying on top of your financial health. Knowing your rating helps you understand how lenders view your creditworthiness – something that can have a major impact on your ability to borrow, invest and grow. But credit score monitoring is not a one-time task. 

Your credit score changes in line with your business activity – this can be a good or a bad thing, depending on how you’ve been handling debt and payments. Taking frequent snapshots of your business credit score helps you be proactive about boosting your credit rating when it matters.

Let’s take a look at what business credit score monitoring involves, and why aiming for a good credit score is vital for the health of your finances.  

Why is business credit score monitoring important?

Business credit score monitoring is the process of tracking any changes to your company’s credit profile over time. It’s a regular, ongoing monitoring process, much like checking your company’s cashflow position, or aged-debt position. 

Regular monitoring helps you spot any credit risks early, giving you time to take action and get your credit score back on track. It also helps you understand how lenders view your business, so you’re primed, prepared and ready to apply for a small business loan or unsecured business loan, if needed.

Why does this business credit score matter?

Your company’s credit score affects your ability to access loans and agree credit terms with your suppliers. It can also affect your insurance rates as a business.

Being seen to be creditworthy, financially healthy and able to manage credit is a significant bonus when you’re looking for funding. Lenders want to know that you’re a low-risk business to lend to – and a good business credit score demonstrates this.

On the flipside, a poor credit score and a high risk rating are red flags for any lender. You’re far less likely to get a loan application approved with a low credit score. 

Why monitor your business credit score on a regular basis?

Regular monitoring of your credit score supports better financial decision-making and long-term financial and strategic planning. 

By checking your score, at least monthly, you can see whether your credit profile is suffering, or if the credit rating agencies (CRAs) have downgraded your score.

Monitoring your score will include:

• Regular checks to look for inaccuracies or changes affecting your score.  
• Alerts and notifications that inform you about credit file updates, such as new accounts or payment defaults.  
• Reviewing analytics and reports, so you understand the factors affecting your score (things like payment history, credit utilisation etc.).  
• Taking proactive action to improve your business credit score; for example, making timely payments and managing your credit utilisation.  
• Building a positive credit history by paying on time, honouring your trade credit and not applying for multiple lines of credit with different lenders.

How to check your business credit score for free

To find your credit score, you’ll need to subscribe with one of the major UK credit rating agencies (CRAs). For business users, these include Experian, Equifax and Creditsafe, all of which offer ways to access your credit score and risk rating. 

Some CRAs offer free or low-cost access to your business credit score file, often with limited features. Most CRAs will encourage you to go the paid subscription route, though free options do exist. 

How can I check my business credit score for free?

Free business credit checks will usually fall into two categories. They will either be legally enforced free statutory reports, which the CRAs must offer. Or they will be free trial subscriptions that will eventually be upgraded to paid subscriptions.  

The Experian My Business Profile service gives you an overview of your basic credit score, with alerts, score advice and the inclusion of commercial CAIS data. It’s free for the first three months and then you’ll need to sign up for a subscription. 

Creditsafe also offers a business credit score report that gives you a real-time view of your score, with alerts and online advice. The report is free for a trial period, but will eventually require a bespoke paid subscription. 

Free trials of credit monitoring are helpful, but be aware that most free trials will convert into paid plans after the trial period, adding to your regular expenses. 

What’s a free statutory credit report?

Under the Consumer Credit Act 1974 and the General Data Protection Regulation (GDPR) 2018, consumers and businesses have the legal right to access a copy of your credit report information held by any CRA. The major CRAs will supply this  but will include only the most basic credit information.

If your budget is small, a free credit report is a good starting point for monitoring your credit score. But you’ll generally get deeper insights from a paid subscription.

What are the best business credit monitoring services in the UK?

Signing up for a paid subscription opens up a world of additional data, credit information and advice on improving your overall credit rating. 

But which CRA or credit report provider should go choose? It’s good practice to sign up with more than one provider, so you get a completely objective overview of your company’s credit score from several sources.

Let’s take a look at some of the available business credit monitoring services:

Experian My Business Profile

With Experian’s My Business Profile, you can access your full commercial credit report and score in real-time. You have online access 24/7 and get an overview of what’s impacting your business credit score and what you can do to improve your score. 

You can also sign up for Business Express to check other company profiles. This is a great way to check the credit profile of potential suppliers and customers.

With My Business Profile, you get:

• Real-time business credit score and credit information
• Downloadable reports
• Monitoring alerts when your profile changes

Cost = £24.99 (+VAT) for a one off report, once your free three-month trial expires

Equifax Commercial Credit Reports

Equifax doesn’t market a specific service for monitoring your own company’s business credit score. But the  Equifax Commercial Credit Reports does allow you to check the credit rating of millions of businesses, including your own. 

With Equifax Commercial Credit Reports you get:

• A complete picture of the financial information for any organisation
• An overview of group structure, credit details and fraud information
• Location-specific information on County Court Judgements (CCJs)
• Credit checks for both your business and other third-party companies

Equifax pricing is tailored to the demands of your business, so businesses have to request a quote from their team.

Creditsafe’s Company Credit Report

Creditsafe’s Company Credit Report offers credit reports and monitoring of both your own business and other third party companies. You can request free credit reports for any international business, but you’ll need a paid subscription to access the other credit score monitoring features and tools. 

 With the Creditsafe Company Credit Report you get:

• A full overview of the company's credit score 
• Details of the company’s maximum recommended credit limit
• Key risk indicators of any CCJs, debts or late payments
• A summary of financial health, performance and growth

Basic credit reports are free. You’ll need to subscribe to the service for more detailed credit monitoring. Prices are bespoke, based on the features you use.  

Dunn & Bradstreet Credit Insights

Dun & Bradstreet (D&B) is one of the biggest credit bureaus in the world, with access to a huge amount of credit data to inform your monitoring. 

The D&B Credit Insights service offers both a free and a paid subscription model. 

The free service gives you:

• A summary of your overall business risk
• In-app and email notifications of changes to your risk rating 
• Financial ratios for the company
• Insights and tips for improving your credit score

The paid subscription adds:

• Exportable PDF reports
• D&B reports on failure scores, delinquency and D&B rating
• Detailed explanations of any notifications and changes to credit profile
• A host of deeper insights in the company’s financial and payment health

The paid subscription service costs £245 (+VAT) per year. 

Capitalise

Capitalise is a hub for comparing business loans and finance deals. The platform also offers a business credit score service, which allows you to track and monitor your company credit score and risk rating in real time. 

With the Capitalise business credit score service, you can:

• Monitor your business credit score over time
• See and understand the factors affecting your overall credit rating
• Get alerts and notifications re any credit risks
• Find better funding from a network of 100+ lenders

Pricing starts at £19.95/month.

Is your credit score the only important metric when applying for a loan?

Most of the big banks and lenders will place significant weight on your business credit score when assessing an application for an overdraft, business loan or other kinds of finance. However, your credit rating isn’t the only metric to focus on.

Some alternative lenders, like Capify, Oak North or iwoca will also look at things like future cashflow forecasts, business viability and the profitability of the company. 

What factors affect your business credit score?

Your business credit score can be affected by a number of different factors. Being aware of these factors helps you stay alert to the potential impacts and understand the effects of both external and internal elements. 

• Your industry and business type: Some industry sectors are viewed as higher risk than others. If you’re trading in the construction or hospitality industries, your risk rating will be higher. The same applies to start-ups and smaller businesses with minimal credit and payment history to assess.
• Payment history and outstanding debts: Your payment history indicates how long you take to pay your suppliers, and showcases your ability to manage your finances and accounts payable. A high debt level and outstanding aged debt will also be a red flag to the CRAs when giving you a credit rating. 
• Trading history and filing frequency: A lengthy trading history is a positive sign of your viability as a business. On the flipside, a short trading history can be a sign of risk, as can infrequent filings with Companies House.
• How you use your credit: High credit utilisation (maxing out your credit limit on a regular basis) is a sign of bad financial management. The same applies to making multiple credit applications with different lenders. This is a sign that cash flow is poor and your bottom line is in trouble. 
• County Court Judgements (CCJs) or insolvency proceedings: Evidence of CCJs against your business and/or directors is a major red flag for the CRAs. Any signs of insolvency will raise question marks around your ability to manage your finances and keep credit and debt on an even keel. 
• SIC codes: Your Standard Industry Code (SIC) tells the CRAs what industry you trade in and what you produce. If this information is inaccurate or incorrect, you can end up being rated as high risk, when the reality is quite different. 

How to improve your business credit score and boost financing options

Some of the factors affecting your business credit score are hard to manage directly – for example, your industry type or business type can affect how lenders see you. Other factors, like your average payment time or credit utilisation are under your control, meaning there’s a chance here to proactively improve and enhance these factors. 

Ways to improve your business credit score include

• Paying your suppliers and lenders on time, to improve your payment history
• Keeping your business accounts and filings up to date
• Reducing existing debt levels in the company and not maxing out any credit facilities you’re using
• Limiting the number of credit applications you make in a short period
• Considering using a business loan to consolidate or repay debts more effectively
• Checking your SIC codes and Companies House registrations to make sure all the industry information is correct

iwoca offers flexible loans that grow with your business and can support your credit profile through responsible borrowing. This is a great way to build your credit profile and balance out the equity and debt in the company.

Common mistakes that hurt your business credit score

You can’t do much to change your industry sector or business type. But you can make changes to improve your financial and administrative behaviour as a business. 

Avoiding the most common mistakes that harm your risk rating is one way to keep your business credit score in a good position.

For example: 

• Don’t miss payment deadlines or default on agreements or trade credit
• Don’t forget to file your annual accounts or confirmation statements
• Don’t apply for multiple credit products at once
• Keep your Companies House business information accurate and up to date
• Don’t ignore errors or fraudulent activity on your credit report

How often should you monitor your business credit score?

You’ll get far more benefit from your business credit score monitoring if you make it a regular part of your financial management and governance process.

Regular monthly checks help you track any changes, look for fluctuations in your credit score and spot potential issues early. If your score is slipping, you have more time to take proactive action and start boosting your underlying risk profile.

Frequent credit score monitoring is also an important part of your cashflow planning, allowing you to understand your credit profile and the borrowing options open to you.

To get the best from your monitoring:

• Sign up to more than one CRA, so you get multiple insights into your perceived business credit score and creditworthiness as a company.
• Make sure you have alerts and notifications turned on when using your CRA’s app, so you know ASAP when there are any problems with your rating.
• Schedule regular credit score reviews, so monitoring is factored into your planned financial checks and processes. 

Does my business credit score affect loan approvals?

If you’re actively monitoring your credit profile, you’re already in a good position to apply for a business loan. Business credit score monitoring shows you’re aware of the impact of your rating and have made monitoring a key part of your governance.

Lenders want to see a well-capitalised, profitable and healthy business when you apply for a loan. A clear focus on monitoring your risk rating and building your business credit score will be a green light for many lenders. 

iwoca Flexi-Loan: flexible funding for your small business

Achieving a good business credit score is a sensible goal for any business. But if you’ve got a shorter trading history, or a limited credit profile, what can you do to access finance?

At iwoca, we believe in helping small businesses fund their next steps towards growth, expansion and financial stability. Our loans are based on more than just your credit score – we consider your business performance, growth and potential to fund more businesses. 

With an iwoca Flexi-Loan, you can:

• Borrow £1,000 to £1 million
• Pay it back anytime between one day or five years
• Apply online with zero paperwork

If you’re a business with big plans, but a limited credit profile, let’s talk.

Apply for a Flexi-Loan

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