When looking for corporate loans, it is common for lenders to issue a credit statement about the company and possibly even the owners. Generally, there is nothing to worry about as there is a standard in the industry. However, it is common for many questions to appear around the subject, so we answer some of these below.
Credit disclosures can be made for a variety of reasons, but usually happen in two situations: 1) when new customer relations begin and 2) when funding is issued.
Among many companies, it is common for creditors to report a customer before starting a business relationship. The reason for this is simply that you want to avoid customers where the risk is high that they will not be able to pay for the service. Usually, this happens when the payment for a product or service occurs after it has been delivered (for example, when using invoice payment).
The second situation is when financing is given to individuals and companies. In the case of corporate loans, the focus is obviously on the credit information about the company in question. If the lender makes a claim for personal bail, a creditor's bill is often taken, as it is liable for payment in a situation where the company can not repay the debt to the lender.
The companies that offer credit reports have a business model based on collecting data from many different sources and packing it in a summary report that may also contain an analysis and an estimate of risk. Most of the sources used are public, but some are also based on companies collaborating and sharing data.
How does a credit info check-up affect me and my company?
In general, credit information does not affect the credit rating of a company or individual. On the other hand, UC is transparent with the disclosure of the person or company in question. It is therefore up to the reader of the report to make an assessment if there is something negative or not that a company has applied for credits. Generally, it's not a negative thing, as it has become commonplace among individuals and companies to consult with several lenders at the same time to find the best terms. Creditsafe and Bisnode differ in such a way that they do not include data on occasions when credit reports have been made about a specific person or company. In other words, it does not appear to lenders if other lenders have made an enlightenment.
Generally, there are two ways to use credit reports; in their customer relationships as well as in their supplier relationships.
As mentioned above, it is common for companies to take credit information on a customer before initiating a business relationship. Here it is also common for credit information to determine if an invoice payment can be accepted or if the customer has to pay all or part of the amount in advance. Since credit reports are costly, we recommend that you only use them for new and major customers. For existing customers, one's own experience of customer's payment behavior is the best estimate for future payment behavior. Another option is to use credit information in relationships with suppliers. Here you can proactively present a report for a new supplier to accept larger orders against invoice payment.
The length of time a remark is left depends on the company and what kind of remark it concerns. The following is the rule of thumb for each company. To get precise information about specific events, we encourage you to read on the company's websites or contact them.
For individuals and individual companies, a note remains for three years from the occurrence of the event. For legal persons, that is, limited liability companies, commercial companies and limited companies, a remark remains for five years.
Other (like CS): Private persons or individuals and individual companies, data on a payment note remains for three years and is deleted three years after the date of the remark. Among the limited companies, commercial companies and limited companies, the data remains for five years.
Here it is different depending on who the credit report is about. To order a credit information on a limited company, trader or business person (eg, a member of a limited liability company), there is no legitimate need under the Credit Information Act.
In order to order a credit report on private individuals and individual companies, a so-called legitimate need is required under Section 9 of the Credit Information Act. A legitimate requirement means that the ordering party must either have given out a credit (eg a private loan, mortgage loan, or the like) or be about to do so. Another legitimate need is a business relationship; that is, you are about to buy a product or service on invoice or installment.
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