How to build business credit: the steps that actually move your file

The short answer: you build business credit by giving your company its own identity and then letting suppliers and lenders report that it pays on time. Nobody hands you a score. It builds up from payment history: every invoice paid on or before the due date, reported by a company that shares data with the business bureaus.

Step 1: make the business look like a business

Bureaus and lenders need to be able to find your company and tell it apart from you.

Form an entity (an LLC or a corporation) with your state, so the business has its own legal name.
Get an EIN from the IRS. It is free and takes minutes online. Use it instead of your Social Security number on business accounts.
Open a business bank account in the company's name and run all business money through it. Mixing personal and business money is the most common reason a file looks thin.
Use the same name, address and phone everywhere: your state filing, your bank, your website and every account you open. A bureau matches records on those details, and mismatches split your history across separate files.

Step 2: get on the bureaus' radar

There are three main business credit bureaus, and each scores differently:

Dun & Bradstreet issues a free D-U-N-S Number, which is how its file on your company is identified. Its PAYDEX score runs from 1 to 100 and is based on how promptly you pay; 80 means you pay on time.
Experian Business produces a business credit score (Intelliscore Plus) from 1 to 100, built from payment history, debt use and public records.
Equifax also keeps commercial credit files and scores for businesses.

Getting a D-U-N-S Number does not create a score by itself. It gives D&B a place to file the payment history your vendors report.

Step 3: open accounts that report

This is the step most owners skip, and it is the one that builds the file. You need accounts that report your payments to a business bureau.

Vendor (trade) accounts with net-30 terms. Office supply, shipping, fuel and materials suppliers often extend 30-day terms and report payments. Before you open one, ask whether they report and to which bureau.
A business credit card, used for regular costs and paid in full. Ask the issuer whether it reports to business bureaus, personal bureaus or both.
Pay early when you can. PAYDEX rewards speed: paying before the due date can score above 80, while paying late pulls it down fast.

Step 4: give it time and watch it

A business file needs several reported payment experiences before most scores appear, so expect months, not weeks. Check your business reports with each bureau once you have a few accounts reporting, and correct anything that is wrong: an old address, a misspelled name or someone else's debt matched to your file.

How funders actually use it

Business credit helps most with banks, SBA lenders and suppliers offering larger credit lines. For revenue-based funding and working capital, many funders weigh your bank statements and your time in business at least as heavily as any score, and some still look at the owner's personal credit. A strong business file widens your options and can improve terms, but a thin one does not automatically disqualify you. See what lenders actually see in your bank statements and whether applying will hurt your credit.

For a slower, day-by-day walk-through of the setup, read our guide How to build business credit from scratch.

Questions owners ask

How long does it take to build business credit?

Usually several months. Bureaus need a few reported payment experiences before a score appears, so the clock starts when your first vendor or card begins reporting.

Can I build business credit without using my SSN?

You can open many vendor accounts on your EIN alone, but most business credit cards and loans still ask for a personal guarantee, especially for a new company.

Does business credit affect my personal credit?

They are separate files. Accounts that report only to business bureaus do not appear on your personal report, but anything you personally guarantee can affect you if it goes unpaid.

What is a good PAYDEX score?

PAYDEX runs from 1 to 100. A score of 80 means bills are paid on time; higher means paid early; lower means late.

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General information, not financial or legal advice. Terms vary by lender and business.