Understanding Business Credit

Strong business credit scores are the key to getting your company approved for trade credit and financing. Your scores tell lenders, vendors, suppliers, and business partners how likely you are to repay them on time. Getting a business loan is a different process from getting a personal loan. While banks and other lenders look at your personal finances and credit history when reviewing an application for a personal credit card, mortgage, auto loan, or other borrowing, they want detailed business information when approving business loans. You may not even realize that your business has its own credit scores and tracking numbers, including the very important DUNS number. Follow this guide to learn more about the DUNS number and what it matters for your business.

What Is a DUNS Number?

First, it is important to know what a DUNS number is and how it works. DUNS is an acronym for Data Universal Numbering System, which came about in the 1960s from business data and analytics company Dun & Bradstreet. Dun & Bradstreet traces its roots back to 1841 and has nearly 300 million business records on file.

DUNS numbers are 9 digits and free to get from Dun & Bradstreet, often referred to simply as D&B. After applying for a DUNS number at the appropriate website, numbers are generally issued with 24 to 48 hours. But it isn’t the actual number that’s important. Like a Social Security number, it’s how you use it that matters most.

Keep your credit in good shape, so it's ready whenever you need it. Nav is the ONLY source for both personal and business credit scores and tools to build better business credit. Get Started For Free.

Before applying for a DUNS number, you should check the database to find out if your company already has one. If you have borrowed or opened a credit card in the past, you may very well have one and not even know about it! If you search and find you don’t have a number, then it is safe to go ahead and apply. Learn more about getting a DUNS number.

Who Uses a DUNS Number?

Your DUNS number is used for more than just credit reporting, though maintaining a strong business credit score is important and a good use of your DUNS number. DUNS numbers are used by governments, credit agencies, and businesses to track and approve customers and vendors. Here are some of the most high profile DUNS number uses:

US Government – Government contractors need a DUNS number. If you want to do business with the Federal government in any form, you will need a DUNS number before applying or submitting a bid. Business grants from the government also require a DUNS number. Here is a longer explanation via the U.S. Department of Agriculture.

Apple – If you want to develop an app for iPhones or Mac computers and sell through Apple’s coveted App Store, you’ll need a DUNS number. I had to go through this process myself when releasing my first app as a solo entrepreneur. It doesn’t matter the size of your business, you need a valid DUNS number to list your apps through Apple.

Other major users include the European Commission and a long list of industry organizations. Because they are free and used for so many purposes, most business owners are best off signing up for a DUNS number in case they do need one in the future.

One major benefit of the DUNS number compared to a U.S. Government tax ID is its wide ranging uses for business and government purposes. The European Union doesn’t care about your U.S. Federal Employee ID Number, but it does care about your DUNS number.

Your DUNS Number & Business Credit

Dun & Bradstreet does more than just issue the DUNS number. D&B is a full credit reporting agency too! Like Experian, Equifax, and TransUnion offer your personal credit scores, D&B calculates a business credit score.

This credit score is known, as the Dun & Bradstreet PAYDEX® score, which runs from a range of 1 to 100. You can get this number with an account at Nav so you go into tradeline negotiations or a new business loan application with your eyes wide open to what the lenders and business partners see about your business.

Your PAYDEX score goes into the equation that determines your interest rates, loan size, and whether or you you even get approved for the loan at all! This can be a make or break decision for your business, so its importance can’t be emphasized enough.

If you don’t know your business credit score, you can get it for free signing up right here.

Building a Strong D&B Profile

Your DUNS number and PAYDEX score are not the only thing your business gets from D&B. The company maintains a full profile on each business it tracks. Like your credit score, a strong profile can lead to good things for your business. But unlike a credit score, it isn’t always automatic.

One way to boost your score is ensure every vendor and credit card report to D&B for your business. That isn’t always simple, but it is something Nav can help with when you want to get started. Whether you need help or not, building a strong profile is a key step to long-term business credit success.

Between government contracts and credit, your DUNS number matters a lot! If you don’t have one, get signed up so you can start building your profile today. You never know when it will come in handy, and with no cost and so much to gain, you have nothing to lose getting started and applying for your DUNS number today.

Nav has a free tool that connects you to the best business financing offers based on your business and credit data by instantly calculating which ones you're most qualified for. You can see your "MatchFactor score" for over a hundred of the top credit card and loan options—all without a hard credit pull. See my top options now.


Want to talk more about business credit? Let's chat below.