Why Building Business Credit Is Important

Increase Your Purchasing Power

A strong business credit profile can be a valuable asset for the long-term success of any small business by helping to:

• Establish Legitimacy – Having a good business credit score may help a small business to be seen as a real and creditworthy entity. It offers third-parties, such as financing providers, vendors, and suppliers, an idea of how trustworthy or credible a business is in terms of their finances. Just as a good personal credit score helps an individual, a higher business credit score indicates that a business is more creditworthy.
• Provide Access to More Capital – Building good business credit can open up opportunities for accessing capital. Financing providers often evaluate a business’s credit history, financials, and growth potential to determine the amount of financing they offer and payment terms. Having strong business credit increases the chances of securing financing at more favorable terms.
• Leverage Vendor Relationships – Having good business credit can help a business owner establish relationships with reliable suppliers and negotiate better trade terms. Timely payments and a positive payment history can lead to larger discounts and more flexible payment arrangements, which can be advantageous for managing cash flow.

So when customers told us building business credit was important to them – Forward listened. That’s why we report customer performance to Experian Business Credit. For small businesses with solid payment history, this is a unique opportunity to get working capital, while also building their business credit. That means small businesses can work with Forward Financing as a deliberate step towards strengthening their purchasing power.

Why can Forward report customer performance?

As a funder, Forward has the right to share information with credit reporting entities, as indicated in our standard funding or loan agreement.

But remember, to effectively build your business credit, it’s important to establish a good track record with multiple vendors or suppliers who report your performance to credit reporting agencies – not just one. There is no guaranteed method to improve your business credit. However, there are steps you can take to help your business credit report reflect the best possible score for your situation. Visit the Experian Business Credit website to learn more about how to build your business credit score.

For informational purposes only. Not intended as legal or professional advice.