What is a credit bureau and which ones matter for service businesses?

Credit bureaus are the data infrastructure that makes credit-based lending and selling possible. They aggregate payment histories from creditors, public records like judgments and bankruptcies, and other financial signals into reports and scores that other businesses can buy when evaluating risk on a new customer or lending decision.

For consumer credit, the three main US bureaus are Experian, Equifax, and TransUnion. They each maintain independent databases, and reports often differ slightly between them. For business credit, the major bureaus are Dun & Bradstreet (the dominant player), Experian Commercial, and Equifax Commercial. Some businesses also have records at smaller specialized bureaus like LexisNexis or PayNet.

For most small service businesses, the bureau interaction is one-directional — you pull a report on a customer when assessing risk, but you do not report your own customers' payment history to the bureaus. Reporting requires a furnishing relationship with the bureau, which has setup costs, accuracy requirements under the Fair Credit Reporting Act, and ongoing maintenance. Most service businesses skip this entirely. Larger creditors and B2B suppliers do report, which is why a habitually late-paying customer can build a poor commercial credit history that follows them across vendors.