Why it matters
Building business credit creates a lender-facing history tied to the company, which can unlock loans, higher credit lines, and supplier terms without relying on personal guarantees. It also helps protect owners’ personal credit when the business needs financing (IRS — obtain an EIN: https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online).
Step-by-step checklist to get started
- Form a separate legal entity and get an EIN
- Choose an LLC, corporation, or appropriate structure and register with your state. That legal separation is the foundation for a separate credit identity.
- Apply for an Employer Identification Number (EIN) at the IRS (https://www.irs.gov).
- Open a business bank account and phone line
- Use the business name and EIN. Banks use these accounts when verifying business activity for credit applications.
- List a business phone number and a professional website or business directory listing to increase credibility.
- Register with business credit bureaus and obtain a D‑U‑N‑S number
- Request a D‑U‑N‑S number from Dun & Bradstreet to start a public record for suppliers and lenders (Dun & Bradstreet: https://www.dnb.com).
- Many lenders pull reports from Dun & Bradstreet, Experian Business, and Equifax Business.
- Establish tradelines that report payments
- Ask suppliers and service providers (office supplies, shipping, trade vendors) to extend net‑30 or net‑60 terms and confirm they report payments to business credit bureaus.
- If a vendor doesn’t report, ask if they will or choose vendors who do. Trade credit is often the fastest path to a business credit history.
- Use and manage business credit accounts responsibly
- Apply for a small business credit card or a secured business card if needed. Maintain utilization below ~30% and pay on time or early.
- Keep separate bookkeeping and don’t charge personal expenses to business accounts.
- Monitor reports and correct errors
- Regularly review business credit reports from D&B, Experian Business, and Equifax Business. Dispute inaccuracies directly with the bureau (see CFPB guidance for disputing consumer credit errors — similar care applies to business report disputes: https://www.consumerfinance.gov/).
Typical timeline
- 1–3 months: Legal setup, bank account, EIN, D‑U‑N‑S registration.
- 3–9 months: First trade lines and vendor reporting begin to show on business files.
- 9–18 months: A stable payment history produces meaningful scores and improves access to credit at better pricing.
Practical tips and common traps
- Prioritize vendors that report. In my practice, clients who targeted reporting suppliers established usable credit profiles faster than those relying solely on cards.
- Keep credit utilization low and pay early when possible; payment history is the single biggest driver of business scores.
- Don’t mix personal and business finances. Personal guarantees are still common for new businesses; separate accounts and entity formation reduce personal exposure over time.
- Watch for identity mix‑ups. Small-business reports sometimes conflate entities with similar names — correct these promptly (see our guide on Fixing Identity Mix‑Ups on Business Credit Reports).
Interlinks for deeper reading
- For strategies to avoid personal guarantees while building company credit, see Building Business Credit Without Personal Guarantees: https://finhelp.io/glossary/building-business-credit-without-personal-guarantees/
- Practical, stepwise actions for new companies are covered in Building Business Credit: Practical Steps for New Companies: https://finhelp.io/glossary/building-business-credit-practical-steps-for-new-companies/
- If you want a focused 90‑day plan to improve scores, read Improving Your Business Credit Score: Practical Steps in 90 Days: https://finhelp.io/glossary/improving-your-business-credit-score-practical-steps-in-90-days/
What lenders look for
Lenders and suppliers commonly evaluate: business payment history, public records (liens, judgments), credit utilization, company age, and financials. Some lenders also consider owner personal credit, especially for small or newer businesses.
Resources and authoritative sources
- Apply for an EIN — IRS: https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online
- Dun & Bradstreet (D‑U‑N‑S number and business reports): https://www.dnb.com
- Consumer Financial Protection Bureau (credit rights and dispute guidance): https://www.consumerfinance.gov
Quick startup checklist (copy and use)
- Register business entity and get EIN
- Open business bank account and credit card
- Obtain D‑U‑N‑S number and register with bureaus
- Establish 2–3 trade accounts that report
- Keep utilization low and pay on time
- Review business credit reports quarterly
Professional disclaimer
This article is educational and does not provide personalized financial or legal advice. Consult a qualified attorney, accountant, or financial advisor for guidance tailored to your business circumstances.
