Company Credit Report (CCR) – Improve CIBIL Rank & Report for Company
A Company credit score is a valuable credit rating score that is required by banks and NBFC (Non-Banking Finance Company). Most companies require credit for startups as well as for regular working capital management. Companies offering credit and business loans, in turn, ask for credit rating of applying companies as a guarantee and factor of safety for the loans.
Companies seeking loans need to apply for a Company credit report for submission to the bank or NBFC where a loan has been applied. A company credit report has several features and they include the profile of the company being rated, identification of the report itself, the credit type for which the rating report is being generated, and a summary of the report.
It is important that a company credit score or a Business Credit Score be made favorable so that the applying company or business can get a loan. The factors that can adversely impact the business credit score can be:
- A previous loan issued in the name of the company needs to be paid back before applying for a company credit report or a business credit score.
- Applicants need to ensure there are no transaction errors in the rating report
- A high credit utilization ratio is not desirable as it indicates a regular credit hunger of the business. This needs to be rectified over a period of time before a credit rating is sought and a new loan applied.
- The size and the age of the enterprise need to be big and reputable so that the credit rating improves and a larger volume of business loans can be obtained.
History of timely repayment of past loans can be a great impacting factor
The process of the Company credit report
The process of applying for a Business credit score has been tabulated below:
Tips for keeping Company Credit reports favourable
- The credit rating scale for a company credit report consists of a recovery ratings scale and independent credit evaluation. Both need to be monitored and kept positive.
- Old credit cards need to be kept open. The company needs to ensure there are no dues outstanding in these cards and they will serve to increase credit rating. Companies should, however, avoid opening new credit card accounts as these will create an adverse score.
- Companies need to ensure their bills are always paid on time as bills make up 35% of a credit score.
- Loan enquiries show up in a credit score and companies could do well to check within a short period and close the enquiries as there is a 30 day grace period.
- There are credit boosting techniques such as taking loans that are not required and paying them back quickly. The repayments reflect as good credit ratings and show up in the company credit score.
- The secret to get regular loans for your business is to develop a good relationship with a loan provider and always maintain a high credit rating score. Loans will be regularly required for running a business smoothly. Managing finances and keeping a good track record in clearing bills and avoiding due payments will not only improve credit ratings but will give the business a good name and keep its reputation high.
- The company credit score is not only a way of rating a company’s creditworthiness but to also reflect its business and business ethics. This is the reason credit institutions use the company credit score to evaluate businesses and the factor of risk in giving loans to them.
Company credit report FAQs
1. What is the difference between a CIBIL rank and a CIBIL score?
2. What is a DUNS number?
3. What is the range of outstanding loan amounts that requires a credit report to be generated for further financing?
4. What does a company credit report mention?
5. Can a company challenge the credit rating given to it?
6. Does the company credit score have to be taken from any particular agency?
7. Does the type of business have an influence on the credit rating?
8. Do credit card transactions also show up in a company credit report?
9. Can a company not having a company credit rating still apply for a business loan?
10. Will a record of prepayment of loans guarantee a good company credit score?
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