How to build business credit

Vendor credit is when a vendor (a business that your business buys goods or services from) extends payment terms to a customer (you/your business). This is generally based upon the customer meeting certain criteria set by vendors themselves and sometimes underwriters or financial institutions.

Vendor credit is often made on net terms. This means the customer has a set number of days in which to pay. Net 30, for example, means the customer has 30 days to pay—and they have to pay the balance in full.

Contrast this with revolving credit terms, where a customer can pay some of the balance and carry over the remaining balance to the next month. Vendors will sometimes offer revolving terms.

Another aspect of vendor credit is that it’s only good for the vendor extending it. Unlike, say, a Visa card, vendor credit won’t be accepted anywhere but with the vendor.

Starter vendors are often where to apply for business credit if your business is a startup. Many of them do not require much time in business, or business credit history. And if you cannot meet either of those criteria, you may be able to instead offer a PG or secure your credit with a monetary deposit.

More About Fundability

Retail credit is issued by retailers to buy their products and services. It is only good for the actual retailers issuing the credit (often, credit cards). Since such a business credit card tends to be ultimately issued by banks, your Social Security number will have to be on your credit application. This is in accordance with Federal law.

In general, you will need at least three reported business credit experiences (transactions) on your business credit report in order to qualify. There may be time in business and/or credit history or business revenue requirements. If you cannot meet some or all of those criteria, you may be able to instead offer a PG or secure your credit with a monetary deposit.

Terms can be either net or revolving.

Fleet credit comes from companies that issue credit for purchasing fuel, and the repair and maintenance of vehicles. Often, these are gas cards. Even businesses that don’t have large fleets of vehicles can still benefit from fleet credit.

There may be time in business and/or credit history or business revenue requirements. If you cannot meet some or all of those criteria, you may be able to instead offer a PG or secure your credit with a monetary deposit.

Since these cards tend to be ultimately issued by banks, your Social Security number will have to be on your credit application. This is in accordance with Federal law.

Terms can be either net or revolving.

Service credit is credit issued by a service provider to pay for their services only.

There may be time in business and/or credit history or business revenue requirements. If you cannot meet some or all of those criteria, you may be able to instead offer a PG or secure your credit with a monetary deposit.

Since these credit cards tend to be ultimately issued by banks, your Social Security number will have to be on your credit application. This is in accordance with Federal law.

Terms can be either net or revolving.

Business credit cards are payment cards issued by a vendor through or directly by a financial institution to users. Such a card enables a business to pay a merchant for goods and services. This is based on the business and/or the business owner’s promise to the card issuer to pay them for the amounts plus any other agreed charges.

There may be time in business and/or credit history or business revenue requirements. If you cannot meet some or all of those criteria, you may be able to instead offer a PG or secure your credit with a monetary deposit.

Since this kind of business credit card is issued by banks, your Social Security number will have to be on your credit application. This is in accordance with Federal law.

Terms are usually revolving.