Owning and operating a business is a job that often requires you to have funds readily available in order to help your business grow and perform effectively. You may need the funds to purchase new equipment, restock inventory for your e-commerce website, or just to survive a slow season where you don’t have the cash flow that you need coming in. At Provident Payments we understand the relationship between small businesses and their financial health so we’re bringing you tips that will help you increase your company credit score.
Check your credit report
Before you can worry about increasing your company’s credit score, you need to know where you stand. Checking regularly can help you have a better idea about how you are doing with creditors and if you need to adjust. If you notice your credit score takes a dip, you can respond accordingly to help it increase. Additionally, checking your credit score regularly will help you identify any inaccuracies that may also be negatively impacting your score.
Pay your bills on time
Failure to make payments on time (or at all) will take a hit to your credit score which can weigh it down. In order to ensure that your credit score increases, you will need to make sure that you are making every payment on time.
Decrease your credit utilization ratio
Your credit score is also negatively impacted the higher your credit utilization ratio is. This means that if you are given a credit line of $25,000 and you are constantly at $23,000 in debt, it will poorly reflect on your credit. Luckily high credit utilization is easy to correct. First and foremost, you should aim to pay off the balance in full, if not most of the balance. You may also look into increasing your monthly credit limit. This is easier if you already have a good history with the creditor. If you find that your credit card payments pile up quickly, you may want to start a payment regimen where you pay your bills more than once a month in order to stay on top of them.
Pay off balance, increase the credit limit, decrease credit card spending, open a new line of credit, pay your bills more than once a month
Dispute any errors and inquiries
Every now and then, hopefully, not often, you may see errors reported on your credit score. These inaccuracies will reflect poorly on you and drive your score down so it is up to you to identify them. If you check your credit score regularly, this should be easy. But it is up to you to dispute them once you find them or they will remain on your credit history.
“Pay for delete” with collections
If you have missed payments and you find that you have been sent to collections for defaulting on payments, your credit score will take a big hit. Luckily there is still hope for you to get your credit score up. When you are ready to make good on your debt, you can call or write the debt collection agency and negotiate a “pay for delete” arrangement. In this arrangement, the collection agency will remove debt collections accounts from your credit history.