According to Experian's latest Women in Business report, women are opening businesses at a record pace, but they are using less commercial credit and rely more heavily on consumer credit than men, which may be limiting their personal and business financing options.

The report was released today to educate business owners about the benefits of commercial credit use. According to the report, instead of leveraging commercial credit and traditional small-business loans, female business owners are more likely than men to rely on personal credit to expand their businesses. Experian found:

Female business owners account for 34% of businesses and represent 22% of active commercial credit shoppers

On average, women business owners have half the number of commercial trades as male business owners and carry approximately $15,000 less in commercial balances

Women have an average commercial balance of $25,000, while men have an average balance of $40,000

"According to the Women's Business Enterprise National Council, more than 1,800 women-owned businesses are started every day in the U.S, representing significant opportunity for our economy," said Hiq Lee, President Experian Business Information Solutions. "Experian is committed to creating opportunities for small businesses to succeed. With this report, we hope to help women business owners understand how leveraging commercial credit can positively impact their business as well as their financial health."

The impact of relying on personal credit
For some women, the inclination to self-finance their business, is having a negative impact on their personal credit scores. Findings include the following:

Approximately 28% of female business owners have 10 to 19 consumer trades (credit cards, personal loans, etc.) compared with 20% of male business owners

51% of male business owners have a consumer credit score of 750 to 849, compared to 46% of women business owners

18% of women business owners have a credit score of 550 to 649, compared to 14% of their male counterparts

The increased amount of personal credit women business owners are using is leading to higher credit utilization rates and consumer trade counts – two factors that can negatively impact credit scores.

"Relying on consumer credit can make it more challenging for women business owners to obtain commercial financing in the future," added Lee. "There is a great need for more education about the impact of relying on personal credit. By developing a greater understanding of commercial credit options, women can grow their businesses more quickly and effectively while protecting their personal credit."

Tips for Improving the Financial Health of Women in Business
Maintaining a business credit profile separate to a personal credit profile can help business owners develop a commercial credit history and protect their personal credit profile. This is especially important should a financial mishap occur with their business. Experian recommends the following to help both male and female business owners improve and maintain their financial health while growing their commercial credit profile:

Pay on time: Paying debts on time and according to agreed-upon terms is key to maintaining both personal and business credit histories.

Explore your options: Business accounts from financial institutions, shipping vendors, lessors, and utility and telephone companies can be established in your business's name, rather than your personal name to help establish and grow a business credit profile.

Leverage existing resources: Opening a business credit card or a business loan are not the only ways to build commercial credit. Business owners can also secure credit terms from suppliers to help build a business credit profile. It's also recommended to check with your existing lenders and suppliers to see if they report commercial data to Experian.

Monitor your business credit report: Business owners should regularly monitor their business credit reports and update any invalid information. Business owners can view their Experian credit report by visiting www.Experian.com/mybusinesscredit