The Complaint Magnet
I’ve spent over 20 years working in the field of international corporate credit investigation.
In that time, I’ve often heard frustrated clients say things like:
“U.S. credit reports are useless—there’s barely any substance!”
“It’s all data and no commentary. And when there is text, it’s just an explanation of the score.”
Among all types of credit reports, those on U.S. companies tend to be the most likely to generate complaints.
For over two decades, I’ve been explaining to credit managers that “U.S. credit reports are different from what you’re used to with Japan’s Teikoku Databank or Tokyo Shoko Research,” and that “this is how you should interpret the information.”
But the truth is, most still don’t fully understand them.
And who can blame them? These reports are incredibly data-heavy and not easy to read.
However—once you understand how to interpret that data, you’ll realize that U.S. credit reports actually contain enough information to infer all kinds of qualitative insights.
Having read thousands of reports from Dun & Bradstreet, Experian, Coface North America (formerly Veritas), Creditsafe, and more—and having endured the many complaints that came with them 😓—I’d like to share a few tips on how to decode them.
Major Providers of U.S. Credit Reports
In Japan, when it comes to investigating U.S. companies, Dun & Bradstreet (D&B) is by far the most well-known—largely due to its tie-up with Tokyo Shoko Research.
But as the earlier complaints suggest, D&B is often criticized for being “light on content”, and credit managers usually obtain their reports more out of necessity than enthusiasm.
A notable alternative is the Coface report, originally produced by a firm called Veritas, which was later acquired and merged into Coface North America.
Other sources include:
- Teikoku Databank (partnering with local credit bureaus in the U.S.)
- Experian, known for its consumer credit data, which also provides business reports on the side
- Creditsafe, a newer entrant offering competitive pricing and delivery times
Nowadays, users can choose a provider based on various factors—cost, speed, coverage—but the content itself is largely similar.
Payment history data, for example, is often shared across bureaus or sourced from large credit data exchanges, so there’s very little variation.
There are a few boutique firms in the U.S. that offer report enhancements such as site photos or narrative-style comments, similar to Japanese reports. If you’re interested in that kind of reporting, feel free to contact us.
Credit Score and Credit Limit
The core element of any U.S. credit report is the credit score—an indicator of a company’s creditworthiness.
Some providers express it on a 5-point scale, others use a score out of 100, but all serve the same function: to help identify high-risk and low-risk entities.
What’s unique about the U.S. scoring model is that it’s usually based on Probability of Default (PD).
Unlike Japanese systems—where larger companies tend to score higher and smaller ones lower—the U.S. model assesses:
- High revenue companies with cash flow issues = High risk
- Small or new companies with stable cash flow = Low risk
While “Probability of Default” is often translated in Japan as “bankruptcy probability,” a more accurate translation is “likelihood of payment default.”
In other words, it measures the probability that a company will fail to make payment within the agreed terms, not necessarily that it will go bankrupt or become a bad debt.
This is also why the credit limit makes sense: it indicates the amount the company is likely to pay within terms—that is, an amount with a low probability of default.
Sometimes people ask:
“Why is the credit limit so low if the score is high?”
The answer is:
“Because the company is very likely to pay amounts within that small range.”
To Be Continued…
This is just the beginning.
As I was writing, I realized this topic will need much more space than expected. So, with your permission, I’ll break this down into a multi-part series.
Stay tuned for Part 2!
