What is the Delinquency Predictor Score?
November 17, 2015 - D&B Credibility Corporation
You can’t predict the future, but you can help predict certain future events. Some of the scores in a D&B business credit file can help you foresee what may happen down the line. For instance, when working with other companies, you may want to keep an eye on their payment history. You could benefit from knowing in advance if a company you work closely with is likely to make late payments over the next year. Knowing that information could help you run your business more effectively. With the Delinquency Predictor Score, you can get more insight into the likelihood that your partners might pay late.
The Delinquency Predictor Score (based on the information in D&B’s database) helps predict the likelihood that a company will:
• Pay in a severely delinquent manner (91+ days past term) over the next 12 months
• Seek legal relief from creditors
• Cease operations without paying all creditors in full over the next 12 months
The Delinquency Predictor Score ranges from 1 through 5. A business with a score of 1 has the lowest probability of severe delinquency, and a business with a score of 5 has the highest probability of severe delinquency. A severely delinquent firm is defined as a business with at least 10% of its dollars 91+ days slow.
The Delinquency Predictor Score could help your business make decisions about working with others, or others could be making decisions about working with your business based on your score. It can be important to stay up-to-date on the status of your D&B business credit scores and ratings. Having a strong and well-managed D&B business credit profile may help you:
• Show your company’s financial health in the best possible light
• Negotiate better payment terms with suppliers
• Qualify for better interest rates
What an Increase in Your Delinquency Predictor Score May Mean
If you receive notification from D&B that your Delinquency Predictor Score has increased, this indicates that you may have a lower risk for delinquency, which could help you appear more credible to other businesses. There are ways you may be able to help impact your score further, though.
What a Decrease in Your Delinquency Predictor Score May Mean
If you’re notified by D&B that your Delinquency Predictor Score has decreased, this indicates that you may have an increased risk of delinquent payments, which could signal to other businesses that you’re not as reliable as you may have been previously. To learn about ways you may be able to impact your score, call a D&B Credit Advisor today. |