How to Establish and Build Business Credit

Posted on Aug 28th, 2023
A woman reviewing her business's credit on her phone

Just like your personal credit score, your business credit score needs regular maintenance to grow and flourish.

Your business credit reports are available to anyone who wants to work with your company, and they can significantly impact you if you’re a small business that’s just starting. However, not every company you work with will report your information to creditors. That’s why Mid Penn Bank has developed this guide to help you learn how to establish and build your business’s credit.

What Type of Credit Do You Need to Start a Business?

Before you have a business credit score, your company’s creditworthiness and approval odds are tied to your personal credit score. This credit will remain important as you apply for small business loans, even once you establish company credit. Many lenders will require a “personal guarantee” which will consider your personal credit score. As you navigate the process of building commercial credit, you should also ensure you’re maintaining your own credit score.

How to Start Building Your Business Credit Score

Building your business credit score and establishing a baseline takes time. That’s all the more reason to begin the process now, regardless of how your personal credit score looks. If you follow these guidelines, you could potentially reach a good credit rating within a year.

1. Register Your Business

Have a solid foundation before you begin developing your credit score. Make sure your business has a proper address, phone number, and email, along with a professional who manages them. Depending on the state in which you operate, you’ll then need to register as a business and possibly obtain licensing. In Pennsylvania, you only have to register your business if you’re not operating it under your legal name.

2. Apply for a Data Universal Numbering System (DUNS) Number

Now that your business is legitimized, you can register with Dun & Bradstreet, a business credit reporting agency, for your DUNS number. Your DUNS number is a unique, nine-digit code Dun & Bradstreet will use to monitor your transactions and update your credit score.

3. Get a Business Credit Card

You can start building credit once you have your DUNS number. One of the fastest ways to do this is to apply for a business credit card and use it for everyday purchases. Mid Penn Bank offers an array of business credit cards for many types of businesses, large and small alike. As with your personal credit score, making small purchases and paying off your bill every month is an excellent way to develop your history and prove the trustworthiness you’ll need for larger purchases.

4. Work With Accounts and Vendors That Report Payments

If your business can’t qualify for a credit card right away, there are other ways to build your credit. Your business is constantly meeting and working with suppliers, utility companies, financiers, and more. If you can, work with organizations that will report your payment history to creditors.

5. Keep up With Your Account

After you start building your credit, it’s vital to keep up with it. Maintaining your credit means consistently paying your bills on time so you can build up your account quickly and avoid negative impact to score. You should also monitor the account so you can track your progress and immediately dispute any mistakes you find in the data.

Apply for Your First Business Credit Card Today

At Mid Penn Bank, our goal is to serve the Central Pennsylvania community by offering the financial services individuals need to manage their personal and professional lives. We want to see the small businesses in our area succeed, and in many industries, having good credit is a vital factor. Learn more about our flexible business credit cards by discussing your options with our professionals or by submitting an online application now.



The material on this site was created for educational purposes. It is not intended to be and should not be treated as legal, tax, investment, accounting, or other professional advice.

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