The majority of UK SMEs neglect their business credit scores

Business credit scores play a big role in the success of UK small and medium-sized businesses (SMEs). They affect everything from getting finance to agreeing better terms with suppliers. Lenders and suppliers often use these scores to decide who to work with. But many small business owners are unaware of how important their credit score really is. In fact, nearly two-thirds have never checked it, and around 90% don’t know what actually influences it. As financial pressures grow, this lack of awareness could be holding some businesses back.

Most business owners don’t know what affects their score

The knowledge gap around business credit scores is wide. Research by Experian found that only 13% of UK SME financial decision-makers are fully aware of the key factors affecting their business credit score, implying 87% have only partial or no understanding of those factors. In other words, the vast majority of small businesses do not understand what drives their credit score up or down, from positive actions like paying suppliers on time to negative events like county court judgments. This lack of understanding can lead to missed chances to improve their credit score and better their access to finance, credit and new partnerships. 

Making matters worse, many business owners aren’t even checking their credit reports, surveys show that more than half of UK SMEs never review their business credit file. Without regular checks, they may not spot errors, signs of fraud and late payments may go unchecked. 

“Only two in five UK SMEs have ever checked their commercial credit score,” one Experian study noted.

Regularly checking and understanding your business credit score is the first step toward managing it. Much like keeping an eye on your car’s dashboard while driving, it helps you stay on track and catch any problems early.

Credit scores are recovering after pandemic slump

UK business credit scores saw a sharp decline during the pandemic, reflecting the financial strain many companies faced. However, by late 2021, scores had recovered to pre-pandemic levels, a promising sign for the resilience of the small business sector. 

According to Experian’s analysis of 2.2 million UK businesses, the average commercial credit score rose to 44 (on a 0–100 scale) by September 2021, up from around 40 during the peak of the COVID-19 disruption.

This rebound highlights an important trend: businesses that took steps to stabilise their finances were able to restore their credit standing relatively quickly. It’s a clear reminder that credit scores are not fixed; they respond to proactive financial management. For companies still recovering, this recovery offers a roadmap: paying attention to credit health can directly impact funding opportunities, supplier trust, and long-term growth.

Recovery varies widely by sector

The recovery, however, has been uneven across industries and regions. Sectors like retail saw sharp drops in 2020 but bounced back by late 2021 as they adapted operations. 

By contrast, industries such as travel and hospitality, hit hardest by lockdowns, experienced deeper score declines that have been slower to reverse. 

Helping businesses take control of their credit profile

While credit scores have always played a key role in access to finance, the past few years have brought this into sharper focus. Tools like Capitalise’s Credit Review Service were created to help small businesses better understand and update the information that shapes their credit profile. This service allows small business owners to have their business credit profile professionally reviewed and updated with the latest financial information, potentially giving their score a quick uplift. In 96% of cases, businesses that submit an application for a Capitalise Credit Review see a positive change to their credit score or credit limit. In practical terms, this means nearly all participants have managed to improve their credit standing, in as fast as a week, by having new data (like recent trading figures from management accounts) factored into their score.

“Small businesses now have the ability to quickly improve their business credit score using new, relevant information,” Experian noted at the service’s launch (Experianplc.com).

The review process typically delivers a decision within 5 to 10 working days, after which the credit reference agency adjusts the company’s score if warranted. In one recent case, a simple review and correction of data helped a small hospitality business boost its score from a high-risk 5/100 to a healthy 89/100: moving from “maximum risk” to “low risk” in just five days. A stronger score can open doors to faster loan approvals, better supplier terms, and reduced financing costs. On the other hand, a low score can limit your access to growth capital, delay important deals, and raise the cost of borrowing.

With continued economic uncertainty, now’s the time for SMEs to take control of their credit. That means checking your score regularly, understanding what influences it, and using tools like our Credit Review Service to make sure your credit report reflects your true financial position.