Your credit score is a critical factor lenders consider when approving business loans. A good credit score can unlock better loan terms, higher limits, and faster approvals, giving your business the financial flexibility it needs to grow.
Obtain your credit report from authorized bureaus like CIBIL or Experian. Review it for inaccuracies in personal information or payment records, and dispute errors promptly.
Pro Tip: Check your report annually to stay informed of changes.
Payment history significantly impacts your credit score. Ensure all loan EMIs, credit card payments, and utility bills are paid before their due dates.
Tip for Entrepreneurs: Automate payments to avoid missed deadlines.
Keep credit utilization below 30%. If your limit is ₹1,00,000, aim to use no more than ₹30,000.
Quick Fix: Pay off credit card balances early or request a credit limit increase.
A mix of credit types—credit cards, personal loans, and business loans—can positively impact your score. Lenders view a diverse credit profile as a sign of financial maturity.
Each application creates a hard inquiry that can temporarily lower your score. Apply only when necessary.
Pro Tip: Space out applications to minimize score impact.
Create a systematic repayment plan to clear existing loans and credit card balances. Prioritize high-interest debts.
Improving your credit score requires discipline and strategic financial management. By following these steps, you can enhance creditworthiness and unlock better business loan opportunities.
“Need help with financing? Contact Ratnaafin to explore loan options tailored to your business needs.”
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