What is a business credit score and how does it affect invoice payment?

Commercial credit bureaus track business credit scores. The major ones are Dun & Bradstreet (Paydex score), Experian Business, and Equifax Business. Unlike personal credit scores, business scores are often visible to any business that requests them, without a formal application. A supplier deciding whether to offer net-30 terms to a new customer might pull a Dun & Bradstreet report before agreeing. The Paydex score runs from 0 to 100. Above 80 means the business typically pays within terms; below 50 suggests consistent late payment.

If you're the one extending credit, a customer's business credit score feeds into your credit decision. A new customer with a strong Paydex score and a clean Experian Business report carries less collection risk than one with no commercial credit history or recent delinquencies. Pulling a business credit report before extending significant net terms is standard credit management.

If you're being evaluated, late payments to your own vendors and suppliers affect your business credit score, regardless of how your customers treat you. A business with a poor Paydex score finds it harder to get favorable payment terms from suppliers. Paying suppliers within terms consistently is the primary way to build and maintain a strong business credit score.