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How to Build Business Credit with Bad Personal Credit

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Having bad personal credit, admittedly, doesn’t make it easy to build business credit. But it can certainly be done with the right approach.

Here are some specific strategies on how to build business credit with bad personal credit to make yourself a more attractive borrower.

Establish Your EIN

A good starting point is to establish an Employee Identification Number (EIN).

This is a nine-digit number that’s assigned by the IRS to businesses operating within the United States and the US Territories.

An EIN is used for multiple purposes, including “filing company tax returns, opening a business bank account, applying for licenses and permits, and applying for business credit,” the Small Business Administration explains.

It’s helpful to have an EIN because it gives you another means of attaining business credit lines, and you can open a business bank account with it rather than using your personal information.

An EIN kills two birds with one stone because it will help get your small business off the ground and also serves as a workaround for bad credit.

So if you haven’t established one yet, now is the perfect time to do so. You can find all the information you need for applying for an EIN here.

Register with Dun & Bradstreet

While the three major credit bureaus for reporting personal credit information are Equifax, Experian, and TransUnion, it’s a little different for business credit.

Information is still reported to Equifax and Experian. But, instead of TransUnion, the other main credit bureau it’s reported to is Dun & Bradstreet, among others.

Another critical part of establishing business credit is registering with Dun & Bradstreet, where you apply for a Data Universal Number System (DUNS) number.

It’s free and easy to do and can be done via the Dun & Bradstreet website here.

Simply complete the four basic steps, and after your information is validated, you’ll receive your nine-digit DUNS Number.

Once you have it, lenders and credit agencies will use it to verify your legal status as a small business owner from the Dun & Bradstreet Database and assess your credit profile.

This, along with setting up a business bank account, is integral to “legitimizing” your business. It also should unlock opportunities for partnering with other companies and put you on your way to building business credit.

In turn, it should increase your odds of being approved for a small business loan, business line, credit line, and other forms of business financing. This brings us to our next point.

Apply for Tradelines with Your Vendors

Tradelines can be helpful to most small business owners. But they can be especially helpful for newer business owners who are just getting started and need to get some credit under their belt.

Even with bad credit, vendor tradelines should be a feasible way to start generating some trade credit, which can get you moving in the right direction.

With vendor tradelines, you set up an account with a vendor that has payment terms where invoices must be paid by an agreed-upon time frame.

Under net-30 terms, for example, you have 30 days to pay the invoice. With net-45 terms, you have 45 days to pay. With net-60 terms, you have 60 days to pay, and so on.

As long as you pay on time and the vendor reports it to a business credit bureau, it should start alleviating your bad credit and boost your business credit score.

And as you get in the habit of consistently making prompt payments, your business credit should keep growing, eventually helping you overcome your poor credit history.

Just be sure that the vendor reports payments to the business bureaus — ideally, choosing those with short payment terms, as this will help you build credit faster.

Apply for a Business Credit Card

One of the primary factors for determining business credit is payment history. In fact, most experts agree that this carries the most amount of weight overall.

Besides paying your vendor tradelines on time, another good way to build credit quickly is by applying for a business credit card and using it responsibly, not merely making your payments on time but ahead of time.

Also, just like with a personal credit score, credit utilization comes into play here, meaning you’ll want to keep your credit card usage low.

The combination of prompt payments and low credit utilization can quickly build good business credit and counteract a bad personal credit score.

Just note that you may have to opt for a secured business credit card initially if you don’t qualify for an unsecured credit card.

Make sure that your secured business credit cards report to the business credit bureaus and not to the personal credit bureaus. There aren’t very many secured business credit cards that report to the business credit bureaus, so this is worth calling out.

When you’re just starting out, you may also need a personal guarantee or have a higher interest rate than you may like from a lender.

But once your business credit improves, your options should increase, and you may be able to obtain a better credit card with better terms and conditions.

Pay Your Business Bills on Time

Again, payment history is the single most important factor for determining your business credit score.

Just as it’s critical to pay a vendor trade line, business loan, and business credit card bills on time, you should get in the habit of paying all your business bills on time.

And whenever possible, go the extra mile and pay them off in advance, so you’re always ahead of the game.

Establishing strong business credit is all about creating a virtuous cycle of good credit.

Staying on top of bills helps you avoid falling into debt and being delinquent on payments. This, in turn, should make you a more attractive borrower to lenders, which should help you negotiate better business loan terms and repayment options.

In time, this can help you achieve a good business credit score and may even give you access to the best business credit cards.

While it can be tough at first when you’re trying to work your way through bad personal credit and generate cash flow, it should get easier in time.

Monitor Your Business Credit Reports Regularly

Just as it’s important to routinely monitor your personal credit, it’s the same with your business credit score.

That’s why you should get in the habit of regularly monitoring your business credit report, so you know what’s happening with each major credit agency.

Doing so has two key advantages.

First, it will give you a baseline assessment of how you’re doing with your business credit and what your overall trajectory is.

While you won’t likely be in an ideal position initially because of your bad personal credit, your trajectory should hopefully improve over time, and you’ll know exactly where you stand.

Second, you should be able to identify any incorrect information and catch errors.

Although each major credit reporting agency does a pretty good job at credit reporting, mistakes do occasionally happen.

If there’s an issue, staying on top of your business credit report should ensure you quickly find it so you can dispute an error before it damages your business credit score.

It’s just a matter of contacting the credit bureau that made the mistake via a formal letter.

Keep Working on Your Personal Credit

Even though you may have poor personal credit right now, it doesn’t mean it has to stay that way long-term.

Your credit — both personal and business — is constantly fluctuating, and it’s never too late to right the ship.

This starts with first understanding which factors contribute to your personal credit score, which, according to FICO, are:

  • Payment history – 35%
  • Amounts owed – 30%
  • Credit history length – 15%
  • Credit mix – 10%
  • New credit – 10%

The other part of the equation is following fundamental best practices, such as:

  • Consistently making payments on time or ahead of time
  • Keeping your credit utilization ratio no higher than 30%
  • Diversifying your credit
  • Not closing out credit card accounts (this adds to your credit history length and lowers your credit utilization ratio
  • Not applying for too many new accounts at once (this can be a red flag to lenders)

I spoke with Forrest McCall, a personal finance expert and founder of Don’t Work Another Day, who emphasized a more personal approach to building credit, “When it comes to managing your personal credit, it’s all about comparing yourself to where you were a few months ago, instead of comparing yourself to others.”

McCall recommends keeping tabs on your credit over time and making small changes to how you manage your money so you can start seeing your score climb.

You may also want to consider applying for a credit limit increase on a business credit card as you become a more trustworthy borrower because this, too, should lower your credit utilization ratio.

That way, you should be able to steadily improve your personal credit score while simultaneously establishing good business credit for a win-win.

Closing Thoughts

Building credit as a business owner with bad personal credit can certainly be challenging. But it’s by no means an insurmountable obstacle.

Even with poor personal finance, knowing what to prioritize and having a clear-cut strategy should help you quickly build business credit and set the tone for creating a thriving company.

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Fintech Kennek raises $12.5M seed round to digitize lending

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London-based fintech startup Kennek has raised $12.5 million in seed funding to expand its lending operating system.

According to an Oct. 10 tech.eu report, the round was led by HV Capital and included participation from Dutch Founders Fund, AlbionVC, FFVC, Plug & Play Ventures, and Syndicate One. Kennek offers software-as-a-service tools to help non-bank lenders streamline their operations using open banking, open finance, and payments.

The platform aims to automate time-consuming manual tasks and consolidate fragmented data to simplify lending. Xavier De Pauw, founder of Kennek said:

“Until kennek, lenders had to devote countless hours to menial operational tasks and deal with jumbled and hard-coded data – which makes every other part of lending a headache. As former lenders ourselves, we lived and breathed these frustrations, and built kennek to make them a thing of the past.”

The company said the latest funding round was oversubscribed and closed quickly despite the challenging fundraising environment. The new capital will be used to expand Kennek’s engineering team and strengthen its market position in the UK while exploring expansion into other European markets. Barbod Namini, Partner at lead investor HV Capital, commented on the investment:

“Kennek has developed an ambitious and genuinely unique proposition which we think can be the foundation of the entire alternative lending space. […] It is a complicated market and a solution that brings together all information and stakeholders onto a single platform is highly compelling for both lenders & the ecosystem as a whole.”

The fintech lending space has grown rapidly in recent years, but many lenders still rely on legacy systems and manual processes that limit efficiency and scalability. Kennek aims to leverage open banking and data integration to provide lenders with a more streamlined, automated lending experience.

The seed funding will allow the London-based startup to continue developing its platform and expanding its team to meet demand from non-bank lenders looking to digitize operations. Kennek’s focus on the UK and Europe also comes amid rising adoption of open banking and open finance in the regions.

Featured Image Credit: Photo from Kennek.io; Thank you!

Radek Zielinski

Radek Zielinski is an experienced technology and financial journalist with a passion for cybersecurity and futurology.

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Fortune 500’s race for generative AI breakthroughs

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Deanna Ritchie


As excitement around generative AI grows, Fortune 500 companies, including Goldman Sachs, are carefully examining the possible applications of this technology. A recent survey of U.S. executives indicated that 60% believe generative AI will substantially impact their businesses in the long term. However, they anticipate a one to two-year timeframe before implementing their initial solutions. This optimism stems from the potential of generative AI to revolutionize various aspects of businesses, from enhancing customer experiences to optimizing internal processes. In the short term, companies will likely focus on pilot projects and experimentation, gradually integrating generative AI into their operations as they witness its positive influence on efficiency and profitability.

Goldman Sachs’ Cautious Approach to Implementing Generative AI

In a recent interview, Goldman Sachs CIO Marco Argenti revealed that the firm has not yet implemented any generative AI use cases. Instead, the company focuses on experimentation and setting high standards before adopting the technology. Argenti recognized the desire for outcomes in areas like developer and operational efficiency but emphasized ensuring precision before putting experimental AI use cases into production.

According to Argenti, striking the right balance between driving innovation and maintaining accuracy is crucial for successfully integrating generative AI within the firm. Goldman Sachs intends to continue exploring this emerging technology’s potential benefits and applications while diligently assessing risks to ensure it meets the company’s stringent quality standards.

One possible application for Goldman Sachs is in software development, where the company has observed a 20-40% productivity increase during its trials. The goal is for 1,000 developers to utilize generative AI tools by year’s end. However, Argenti emphasized that a well-defined expectation of return on investment is necessary before fully integrating generative AI into production.

To achieve this, the company plans to implement a systematic and strategic approach to adopting generative AI, ensuring that it complements and enhances the skills of its developers. Additionally, Goldman Sachs intends to evaluate the long-term impact of generative AI on their software development processes and the overall quality of the applications being developed.

Goldman Sachs’ approach to AI implementation goes beyond merely executing models. The firm has created a platform encompassing technical, legal, and compliance assessments to filter out improper content and keep track of all interactions. This comprehensive system ensures seamless integration of artificial intelligence in operations while adhering to regulatory standards and maintaining client confidentiality. Moreover, the platform continuously improves and adapts its algorithms, allowing Goldman Sachs to stay at the forefront of technology and offer its clients the most efficient and secure services.

Featured Image Credit: Photo by Google DeepMind; Pexels; Thank you!

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content management and content development.

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UK seizes web3 opportunity simplifying crypto regulations

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Deanna Ritchie


As Web3 companies increasingly consider leaving the United States due to regulatory ambiguity, the United Kingdom must simplify its cryptocurrency regulations to attract these businesses. The conservative think tank Policy Exchange recently released a report detailing ten suggestions for improving Web3 regulation in the country. Among the recommendations are reducing liability for token holders in decentralized autonomous organizations (DAOs) and encouraging the Financial Conduct Authority (FCA) to adopt alternative Know Your Customer (KYC) methodologies, such as digital identities and blockchain analytics tools. These suggestions aim to position the UK as a hub for Web3 innovation and attract blockchain-based businesses looking for a more conducive regulatory environment.

Streamlining Cryptocurrency Regulations for Innovation

To make it easier for emerging Web3 companies to navigate existing legal frameworks and contribute to the UK’s digital economy growth, the government must streamline cryptocurrency regulations and adopt forward-looking approaches. By making the regulatory landscape clear and straightforward, the UK can create an environment that fosters innovation, growth, and competitiveness in the global fintech industry.

The Policy Exchange report also recommends not weakening self-hosted wallets or treating proof-of-stake (PoS) services as financial services. This approach aims to protect the fundamental principles of decentralization and user autonomy while strongly emphasizing security and regulatory compliance. By doing so, the UK can nurture an environment that encourages innovation and the continued growth of blockchain technology.

Despite recent strict measures by UK authorities, such as His Majesty’s Treasury and the FCA, toward the digital assets sector, the proposed changes in the Policy Exchange report strive to make the UK a more attractive location for Web3 enterprises. By adopting these suggestions, the UK can demonstrate its commitment to fostering innovation in the rapidly evolving blockchain and cryptocurrency industries while ensuring a robust and transparent regulatory environment.

The ongoing uncertainty surrounding cryptocurrency regulations in various countries has prompted Web3 companies to explore alternative jurisdictions with more precise legal frameworks. As the United States grapples with regulatory ambiguity, the United Kingdom can position itself as a hub for Web3 innovation by simplifying and streamlining its cryptocurrency regulations.

Featured Image Credit: Photo by Jonathan Borba; Pexels; Thank you!

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content management and content development.

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