Like many business owners, the retail store owner I spoke with told me she was trying to move away from using personal credit to finance her business. To help her do that, she’s started the process of establishing business credit.
“I’ve got a D-U-N-S® Number,” she told me, “but I’m confused. What do I do next?”
Getting a free Dun & Bradstreet D-U-N-S Number is one of the first steps in the process to establish credit.
It’s the identifying number for a business in the Dun & Bradstreet commercial credit database, and your business must be assigned one in order to create a business credit profile in their system. In addition to helping establish business credit, D-U-N-S Numbers may also be required when doing business with other businesses or getting certain types of small business loans.
But then what?
How to get a D-U-N-S Number
You can check to see if your business already has a D-U-N-S Number using the Dun and Bradstreet D-U-N-S Number lookup tool. If your business doesn’t yet have a D-U-N-S Number, you’ll need to get one. It’s free to register on the Dun and Bradstreet website, and it will take about two weeks in most cases to get your number assigned.
How to use a D-U-N-S Number to establish business credit
After you get a D-U-N-S Number, the next major, and perhaps most crucial, step in the process of building a business credit history is to establish credit references (often called tradelines) that will appear on your credit report with Dun & Bradstreet and other commercial credit reporting agencies.
Payment history is the most important factor that influences business credit scores and without any accounts reporting it’s difficult for a credit bureau to calculate a business credit score.
In fact, to calculate a D&B PAYDEX® Score — one of Dun & Bradstreet’s most well-known credit scores — Dun & Bradstreet says a business needs at least two companies reporting at least three credit experiences to the Dun & Bradstreet credit report of the business entity.
For startups
If you have a brand new business, it’s helpful to make sure you set up your business properly before you start to build credit. This includes choosing your business name, and getting a business address and phone number. Get Nav’s free step-by-step checklist to set up your business the right way.
How do you get business accounts?
To get accounts that report to the major business credit bureaus, small business owners can use the following kinds of business accounts:
Nav Prime helps you accelerate your path to funding by improving your credit history with access to up to two tradelines — one with your monthly payment and one with the Nav Prime Card*.
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Join 250,000+ small business owners who built business credit history with Nav Prime — without the big bank barriers.
Use net-30 accounts
If you can’t qualify for a business credit card at this time, you aren’t necessarily out of luck though.
A number of vendors sell supplies or services to businesses “on terms” where you order items and pay for them later.
The most common arrangement is “net-30” terms where the invoice is due within 30 days of the invoice date. Vendors offer a wide variety of products that businesses regularly use, from shipping and office supplies to furniture and equipment. The initial credit limit may be small but if you pay on time, it will often be increased.
These vendors report to business credit.
Pay on time
Once you have several accounts appearing on your business credit report, the next step is to make sure you pay on time. Again, payment history is the most important factor when business credit scores are calculated. You don’t want to get busy running your business and forget to pay a bill; that can set you back quickly in your efforts to move away from personal credit.
See Credit Card Options For Your Business
Connect your business data when you create a Nav account. Compare credit card options based on your unique business data.
Frequently asked questions after you’ve got your D-U-N-S Number
Can I use my D-U-N-S number instead of my Social Security number?
Some small business lenders check personal credit scores, some check business credit, and some don’t check credit at all. If a Social Security number is required, it may be to check personal credit, but sometimes it’s simply a way to help verify the identity of the person applying for credit.
An Employer Identification Number (EIN) is the equivalent of the Social Security number for business. You can get an EIN free from the IRS.
Can I get a credit card with my D-U-N-S Number?
Most small business credit card issuers check personal credit. Here’s how to get an EIN only business credit card.
Which business credit cards report to Dun & Bradstreet?
You can find out how business credit cards report to business credit here.
How can I update or correct information on my D&B report?
You can view and update information about your business on Dun & Bradstreet’s website here. It will walk you through steps to verify and update your company information.
What does D-U-N-S mean?
D-U-N-S is D&B’s abbreviation for data universal numbering system. It’s the acronym for the number it assigns businesses in its system.
How do I add accounts I already pay?
There are a couple of options for adding accounts you already pay to your business credit reports. Dun & Bradstreet offers several services under its CreditBuilder™ Plus program. With this service, you can submit up to 12 trade references to your file for review, verification, and possible acceptance.
A service called eCredable Business Lift also helps small businesses get information about certain bills they already pay — such as cell phone, power and internet bills — added to their business credit reports. For a monthly fee, eCredable Lift will verify qualifying bills.
Do you need a D-U-N-S Number for SBA loans?
Your business is not required to get a D-U-N-S Number to qualify for an SBA guaranteed small business loan.
A D-U-N-S Number used to be required to register for federal government grants and government contracts but the federal government now assigns a Unique Entity Identifier when you register at SAM.gov.
Still, if you are going to start applying for business financing or loans, it’s a good idea to make sure your business has a D-U-N-S Number. If your lender or financial institution asks for it, you’ll be able to provide it. That helps ensure your business credit information gets reported properly.
How do you build business credit fast?
The fastest way to build strong business credit scores is to get tradelines that report to business credit, then pay on time and keep balances low. Building business is not an overnight process, but the sooner you start, the sooner efforts can pay off.
Can I build credit for my LLC?
Yes, an LLC can have its own credit reports and credit scores. The process for how to build credit for an LLC is similar to building credit for any other business. Create a foundation, then get tradelines that report.
*DISCLAIMER: Nav Technologies, Inc. is a financial technology company and not a bank. Banking services provided by Thread Bank, Member FDIC. The Nav Visa® Business Debit Card and the Nav Prime Charge Card are issued by Thread Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa cards are accepted. See Cardholder Terms for additional details. FDIC insurance is available for funds on deposit through Thread Bank, Member FDIC. All other features of the Nav Prime membership are not associated with Thread Bank.
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Gerri Detweiler
Education Consultant, Nav
Gerri Detweiler, a financing and credit expert, has been featured in 4,500+ news stories and answered 10,000+ credit and lending questions online. In addition to Nav, her articles have appeared on Forbes, MarketWatch, and Startup Nation. She is the author or co-author of six books, including Finance Your Own Business, and she has also testified before Congress on consumer credit legislation.