The Paydex score, provided by Dun & Bradstreet, is the main credit score used in the business world.
This number assesses a business' lending risk much the same way as a consumer credit score reflects a consumer's individual credit risk. Paydex is essentially the business equivalent of your personal credit score even though it is calculated completely differently than the personal credit score utilized by the three personal credit reporting agencies.
Various vendors report to Dun and Bradstreet about how a firm paid its bills over the past year. This information as to how you pay your bills to suppliers and creditors within the agreed upon terms becomes a unique dollar weighted numerical indicator as is known as your Paydex Credit Score.
An individual FICO consumer credit score is much different from a business Paydex credit score. While personal credit scores range from 350-850, the Paydex score ranges from 0-100. With 100 being the highest Paydex Credit Score attainable, most creditors and suppliers are expecting a minimum score of 70 while a score of 80 or above is preferable.
Listed below is the breakdown of the calculation for the Paydex score:
Expect payment may come early is a score of 100
Payment within discount period 90
Payment is prompt is a score of 80
Fourteen days beyond terms 70
Payment after 21 days from due date 60
Thirty days beyond terms 50
Payment comes 60 days beyond terms is a score of 40
Payment comes 90 days beyond terms is a score of 30
One Hundred Twenty days beyond terms 20
Unavailable UN
If you own a business your Paydex score is essential in establishing new credit and continuing to build credit limits exceeding $100,000.
Business owners can establish a positive Paydex score in sixty days. The first step is to apply for a DUNS number with Dun & Bradstreet.
Once a DUNS number is established with D&B the business owner will want to locate a vendor who will extend credit and report that credit to D&B.
As the business owner receives positive reports from vendors they will have a Paydex score established. All payments should be make early to raise the Paydex score to 80 or higher and then the business owner can apply for more business credit and, once approved, should use it regularly for further Paydex score improvement.
You can easily and quickly establish a positive Paydex credit score. As you continue to pay your bills on a timely basis your scores will continue to rise giving you the ability to qualify for even more credit in your business name.
This number assesses a business' lending risk much the same way as a consumer credit score reflects a consumer's individual credit risk. Paydex is essentially the business equivalent of your personal credit score even though it is calculated completely differently than the personal credit score utilized by the three personal credit reporting agencies.
Various vendors report to Dun and Bradstreet about how a firm paid its bills over the past year. This information as to how you pay your bills to suppliers and creditors within the agreed upon terms becomes a unique dollar weighted numerical indicator as is known as your Paydex Credit Score.
An individual FICO consumer credit score is much different from a business Paydex credit score. While personal credit scores range from 350-850, the Paydex score ranges from 0-100. With 100 being the highest Paydex Credit Score attainable, most creditors and suppliers are expecting a minimum score of 70 while a score of 80 or above is preferable.
Listed below is the breakdown of the calculation for the Paydex score:
Expect payment may come early is a score of 100
Payment within discount period 90
Payment is prompt is a score of 80
Fourteen days beyond terms 70
Payment after 21 days from due date 60
Thirty days beyond terms 50
Payment comes 60 days beyond terms is a score of 40
Payment comes 90 days beyond terms is a score of 30
One Hundred Twenty days beyond terms 20
Unavailable UN
If you own a business your Paydex score is essential in establishing new credit and continuing to build credit limits exceeding $100,000.
Business owners can establish a positive Paydex score in sixty days. The first step is to apply for a DUNS number with Dun & Bradstreet.
Once a DUNS number is established with D&B the business owner will want to locate a vendor who will extend credit and report that credit to D&B.
As the business owner receives positive reports from vendors they will have a Paydex score established. All payments should be make early to raise the Paydex score to 80 or higher and then the business owner can apply for more business credit and, once approved, should use it regularly for further Paydex score improvement.
You can easily and quickly establish a positive Paydex credit score. As you continue to pay your bills on a timely basis your scores will continue to rise giving you the ability to qualify for even more credit in your business name.
About the Author:
Michael Sacks is an established expert with nearly 30 years experience in financial services and banking. Through his company's website you can receive a free e-book aboutestablishing business credit and obtaining funds for your business You will also learn how to avoid the 9 devastating finance mistakes business owners make.. Check here for free reprint license: The Differences Between Personal Credit And The D&B Paydex Business Credit Score.
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