Shropshire firms urged to check business credit score

The message comes from Sarah Hartshorn, of Dyke Yaxley Chartered Accountants, in Shrewsbury, who said businesses of all sizes should take note and be aware of their position.

“Whether you’re a small start-up or an established business, understanding the importance of your business credit score can be essential for long-term growth and sustainability," she said.

“Just as a personal credit score can affect your ability to secure a loan or get approved for a credit card, your business credit score will affect your company’s financial health.”

Sarah said a business credit score represented a company’s creditworthiness, and reflected a business’s ability to responsibly manage debt and meet its financial obligations.

“It’s not just a number – it’s a critical tool used by creditors, lenders, suppliers and even potential customers to gauge the financial risk associated with entering any form of financial transaction with your company.”

Sarah said any company looking for long term finance or even just a short-term cash injection would find their business credit score would play a significant role in the process.

“Lenders and creditors will assess your business credit score to measure the level of risk they’d be taking by offering you credit. If you have a good business credit score, it can open up more favourable interest rates, increased credit limits, and more flexible repayment terms.”

Businesses should also be aware that a good score could be useful when it comes to credit terms and the credit limit offered by suppliers.

“If you have a higher score, you could use it to negotiate extended payment terms or even secure discounts for bulk orders. This can help boost your cash flow and solve the immediate need for working capital.”

Sarah said for any business that was looking to expand or scale up, a favourable credit score was vital.

“Maybe you’re looking for a larger office space, or you want to invest in cutting-edge equipment, or you’re planning to expand your workforce? Whatever your plans, the ability to secure funds when you need them is essential for a successful growth strategy.

“With economic downturns or unexpected business expenses, having access to affordable finance can be a lifeline, and a good business credit score increases your chances of securing emergency funding when you need it most.”

If you need to know more about your business credit score, experts at Dyke Yaxley are working in partnership with Capitalise and can help you to access your Experian business credit report and reveal the factors that are affecting it.