A small business credit history started on the very first day of your operations. For every business owner, among many goals, an important one is to constantly monitor and develop both personal and business credit ratings.
A business credit history is a tabula rasa for every startup, and in order to demonstrate your business’s creditworthiness to get business loans or business credit lines in the future—you need to build your business credit history. For most small businesses, securing a small business loan is a great way to build a business credit history by practicing stellar borrowing habits, and that includes paying off the loan in full and on time.
Even if you’re following a stellar borrowing practice, unluckily, only a few business lenders report it to the credit bureaus. Here is a list of seven small business lenders that report your borrowing practices to the business credit bureaus.
BlueVine, an online lending service that provides a quick fix for businesses that are struggling with cash flow issues with their invoice financing and traditional lines of credit options. They have relaxed borrowing qualifications with a quick funding turnaround time of 2-7 days. With the invoice financing option, a business needs to have 3 months’ time in business, a credit score of 530+ and more than $100,000 in revenue. The credit facility size is up to $5 million at an advance rate of 85% – 90% with a $15 wire transfer fee.
They have two types of credit lines: Flex6 and Flex12. With the Flex6 line of credit option, a business needs to have $120,000 in revenue with 6 months’ time in business and 530+ credit score. For the Flex12 credit line, the revenue of $120,000 with 2 years of time in business for with 600+ credit score. The credit facility size is up to $250,000 at interest rate of 0.3% – 1.5% for Flex6 and 1.5% – 6.5% per month for Flex12 with ARP between 15% – 78%.
The eligibility for both invoice financing and Flex Credit lines depends on the borrower’s outstanding receivables and credit score.
BlueVine is the only factoring company that reports to business credit bureaus, particularly to Experian.
OnDeck is another big name in the small business lending industry that offers short-term loans and revolving lines of credit as short-term working capital solutions for small businesses. In order to qualify for short-term loans, you need to have 12 months’ time in business, a credit score of 600+ and $100,000 in revenue. With their short-term loans, you can secure cash up to $500,000 with terms of 3 – 36 months at origination fee of 0% – 4% and APR of 11.9% – 99.4%.
With their revolving lines of credit, you can secure cash up to $100,000 at draw term of 6 months with a personal guarantee and with APR of 11% – 57.9%.
OnDeck reports to the business credit bureaus—specifically Equifax, Experian, and PayNet
Fundation is also an alternative lender offering installment loans and lines of credit to qualified businesses that have greater financing needs. The minimum qualification requirement includes 12 months of time in business, a personal credit score of 660+ with more than $100,000 in annual revenue. Additionally, they also require you to have at least three full-time employees (including you).
With installment loans, you can secure cash up to $500,000 at a term length of 1-4 years, origination fee up to 5% and APR of 7.99% – 29.99%—making it a great option for long-term working capital needs.
With lines of credit, you can secure cash up to $150,000 at a term length of 18 months, and a $500 closing fee with a 2% draw fee.
They have competitive terms and fees with a quick funding turnaround time of 2-7 days and no prepayment penalty. However, they have stringent borrower qualifications and are not suitable for startups.
Fundation reports to the business credit bureaus —specifically Dun & Bradstreet, Equifax SBFE, PayNet, and Experian.
- Lending Club
With relaxed borrower qualifications, competitive terms, and funding turnaround time of 1-4 weeks Lending Club is another great lender that assists small businesses to grow and succeed. Though, they only work with businesses that 2 years of time in business. They offer term loans with cash up to $300,000 at interest rates of 5.9% with terms from one to five years with APR as low as 9.77%. They also require collateral in the form of a personal guarantee blanket lien on loans above $100,000.
Landing Club reports to the business credit bureaus—specifically TransUnion, Equifax, and Experian.
- Seek Capital
Seek Capital specializes in funding procurement from third-party lenders and offers quick business funding for businesses that don’t qualify for long-term business loans. They offer a multitude of financing options from term loans, lines of credit, invoice financing, SBA loans, personal business loans to equipment financing and merchant cash advances. Here is an overview of the borrowing qualifications for each loan product:
- For Term Loans – 3 years of time in business, 680+ personal credit score and at least $300,000 in annual revenue.
- For Business Lines Of Credit – 1 year of time in business, 630+ personal credit score and at least $180,000 in annual revenue.
- For Invoice Financing – Invoices for reliable customers are most likely to qualify
- For Equipment Financing – 2 years of time in business, 600+ personal credit score and at least $130,000 in annual revenue.
- For Short-Term Loans – 1 year of time in business, 630+ personal credit score and at least $180,000 in annual revenue.
- For Merchant Cash Advances – incoming cash flow is considered to make a decision
- For SBA Loans – 4+ years of time in business, 680+ personal credit score and at least $180,000 in annual revenue.
- For Personal Business Loans – A personal credit score of 680 or less
Seek Capital matches borrowers’ credit profile, business data and plan to pick the right business financing solution. Since they connect business owners to the third-party lenders for financing, your borrowing habit will be reported to the business credit bureaus—specifically Experian, TransUnion, and Dun & Bradstreet.
- The Business Backer
The Business Backer provides merchant cash advances, short-term loans and business lines of credit either directly or through its sister company. The qualification requirements are easy including 12 months of time in business, a credit score of 550+ and $250,000 of annual revenue.
With their merchant cash advances, you can secure cash up to $200,000 at a borrowing fee of 1.6% of the amount borrowed per month and origination fee of 1-3%.
With short-term loans, you can obtain cash up to $200,000 for terms of 4-18 months at draw fee of 0%-3%.
With lines of credit, you can get cash from $5000 to $100,000 at a term length of 12-24 months and a 2% origination fee.
The Business Backer reports to the business credit bureaus—specifically Dun & Bradstreet and Equifax.
QuarterSpot is an online lender that offers short-term loans with cash up to $150,000. The borrowing qualification is easy with 12 months of time in business, a credit score of 550+ and $200K in annual revenue.
The term length of their term loans can be from 6 to 18 months, with an origination fee of 1% – 4%. Another benefit of QuarterSpot is saving money on interest payments if you pay off your loan early.
QuarterSpot also reports to business credit bureaus—specifically Equifax and Experian.
Information Credit Bureaus Don’t Collect
No major credit bureaus collect the following information:
- Bounced checks
- Ethnicity Group
- Gender Types
- Political Views
- Negative items of more than 7 years
The Bottom Line
As a small business owner, now you know which lender reports your borrowing habits to credit bureaus and working with any of them is a great way to build your credit history. Once you’re able to build a good credit score you can secure lower interest rates and terms on borrowing and credit arrangements with lenders. Nevertheless, selecting a lender that reports to the business credit bureaus is just one facet of building your credit profile. In order to have a solid credit profile, work proactively by constantly updating and reviewing your own business credit regularly—and ensure full and timely payments.