For small business owners, having a good credit score is essential when seeking funding. A strong credit score significantly enhances your chances of securing a loan when needed. Fortunately, many platforms are available to help you check your current credit score. A credit score is a forecast of how likely someone is to be able to repay a loan on time, based on information gathered from their credit reports.
Understanding your credit score is crucial before applying for funding, and Old Mutual has introduced SMEgo, a resource platform designed to assist small to medium-sized enterprises (SMEs). Among its many features, SMEgo includes a credit score tool, which is particularly valuable for those looking to secure funding.
Why Is Credit Score Important For SMEs?
When considering your credit score, it’s important to evaluate both your personal and business credit scores. While a healthy personal credit score may help you secure a loan, most lenders will also assess your business’s credit score.
A higher score not only increases your chances of obtaining loans but also provides access to financing as your business expands and expenses rise.
What Is a Good Credit Score For SMEs?
Commercial credit scores typically range from 0 to 100. A score of 0 indicates high risk, making lenders hesitant to provide funding, whereas a score of 100 reflects strong creditworthiness, suggesting that you are a reliable borrower
For SMEs, it is generally recommended to maintain a credit score of 75 or higher.
SMEgo Funding and Finding Your Score
On the SMEgo platform, your business is assigned a credit score that helps lenders assess your ability to repay a loan. Recognising that low scores are a common reason for funding rejections, Old Mutual has made this credit scoring tool available to SMEs.
Although many SMEs have the necessary documentation to apply for loans, applications are often rejected due to low credit scores. To address this, SMEgo provides its subscribers with a business credit score, generated by Experian. This credit report is compiled using historical and current information about your business’s closed and open credit accounts. The credit score tool is available exclusively to Premium Plus plan subscribers on SMEgo, which costs R 299,99 per month. This plan offers various features, including the ability to create unlimited invoices, quotes, purchase orders, and delivery notes, as well as income and expense tracking, and the ability to add unlimited products, services, customers, and suppliers. Uploading sensitive documents such as financial statements and bank statements is essential for generating an accurate credit score. To ensure the security of your information, SMEgo employs robust security protocols. All sensitive and confidential information you provide or create on the platform is private and fully protected.
Additionally, the business information you upload is accessible only to you, in compliance with the Protection of Personal Information Act (POPIA).
To find your credit score on SMEgo, navigate to the ‘Funding’ page. Your score will be displayed at the bottom of the page. To ensure your credit report is accurate and up-to-date, SMEgo allows you to generate a new credit report every six months upon request.
The SMEgo app is free to download on the iOS App Store, Google Play Store or via the website.
For more information on SMEgo, send an e-mail to smego@oldmutual.com. You can also speak to a SMEgo consultant, simply dial (+27)21 137 6078 or (+27)67 718 5598.
