DescriptionBusiness credit monitoring or business tracking is the viewing of a business' credit history by a third party. Mostly used as a means to determine a business's ability to repay its loans, this kind of monitoring/monitoring helps credit lenders to determine a business's credibility. Credit monitoring enables businesses to avoid bad debts by setting up repayment plans with their creditors, in case payments are late or debtors don't make their payments at the agreed upon dates.
Why is business credit monitoring important? Businesses and individuals alike rely on their personal credit scores to facilitate day-to-day financial transactions and facilitate business deals. Credit monitoring enables business owners and managers to quickly identify any default payments or missed payments – thereby enabling them to take corrective action. This also enables them to detect any unusual activity on a business' credit file, which may point to fraudulent activities.
What do business credit monitoring companies do? Businesses and banks employ business credit monitoring companies to supervise the timely payment of outstanding debts and monitor the progress of loan collection efforts. Businesses also hire these companies to make sure that their business' accounts receivables (accounts receivable) are collected on time, which is essential to their financial success. Most business credit bureaus are used by financial institutions, such as banks, to provide a more reliable measure of business financing. They are also responsible for collecting overdue payment debts from customers.
How are business credit monitoring services measured? The score obtained from a business credit monitoring company is an actual business credit score, not a credit score derived from a single credit bureau, such as Equifax, Experian or TransUnion. That is, if you were to go to each of the three bureaus and request your business credit score from them individually, you would get a different number each time. The score that you receive is instead an average from all three.
If you're wondering why you need to worry about your business' credit monitoring, you need only remember that identity theft is a very real issue, and it's affecting more than just criminals. According to the Society for Human Resource Management, a recently released study showed that almost half of all credit card fraud is perpetrated by repeat offenders. Those criminals have gone through a criminal background check using the free business credit monitoring services that are available online. If you do business with any company that does not perform such checks, you are putting yourself at risk, and you could be leaving your company and even your own finances in jeopardy. Don't put yourself in that position!
So, if you don't already have a business credit advantage, you need to make sure that your employees have access to one. You can't afford to sit back and wait to see what happens to your credit history while you're away at work. Make sure that you get the services of one of the Experian, Equifax and TransUnion monitoring services so that you have complete peace of mind at all times. Whether you choose a company that offers their services . . . . . . for free or has a fee, you'll be glad that you had access to this valuable service when you need it most.