What is one effective strategy for businesses to enhance their credit scores?

Paying bills on time is a fundamental practice for enhancing a business's credit score. Timeliness in making payments reflects reliability and responsibility to lenders and credit bureaus, which directly impacts the credit score positively. When bills, such as loans, credit lines, or supplier invoices, are paid consistently on or before their due dates, it demonstrates financial discipline and can improve the business's creditworthiness over time. Moreover, timely payments help maintain a good payment history, which is one of the most significant factors affecting credit scores.

In contrast, increasing credit card balances can lead to higher utilization ratios, which negatively affect credit scores. Taking on new debt indiscriminately may not be beneficial if the business cannot manage those payments responsibly. Finally, ignoring credit reports prevents businesses from recognizing and addressing discrepancies or areas for improvement, which is crucial for maintaining or enhancing credit ratings. Therefore, the practice of paying bills on time stands out as the most effective strategy to boost a business's credit score.