- How is my MARQ score used by others?
- Does checking my MARQ score affect my credit score?
- Can I share my MARQ score with my lender or another business?
- How is MARQ score different from other business credit scores?
- Is the MARQ score the same as a Moody's credit rating?
- What should I do if my MARQ score seems wrong?
- Who is Finagraph?
What is a MARQ score?
A MARQ (Moody’s Analytics Risk Quality) score is a business credit score that helps you and others – like your lenders and suppliers – understand how likely your business is to repay its credit. It is based on a statistical analysis of the business’s financial information, including measures that indicate if the business is generating enough cash to make its debt payments and if the business is building net worth over time. The MARQ score also considers the industry your business is in and external economic factors. To learn more about the MARQ score and how lenders evaluate creditworthiness, download the MARQ paper.
What will I see when I get my MARQ score?
- When you set up your account, you’ll see the MARQ score for your business and a comparison to the typical score for businesses in your industry and region.
- You’ll also get information on the drivers of your score – what’s helping or hurting it – along with explanations of what those factors mean, why they matter, and what you should consider to help drive good business performance.
- There is a simulator tool that helps you see what your score would be if you made changes, and a place where you can set up an action plan and get ideas on how to make those changes.
- When you update your score, you can see how far you’ve come on your action plan.
What is my MARQ score based on?
Your MARQ score is based on the financial information for your business that you submitted to the MARQ site. It is calculated based on up to 11 financial statement ratios derived from 20 inputs from your current and prior year financial statements. The more complete the financial information you provide on your business, the more predictive your score is likely to be. The ratios are used to evaluate the potential creditworthiness of your business based on historical information on whether or not private businesses with similar characteristics have successfully repaid their debts in the past. The historical information comes from the Credit Research Database of Moody’s Analytics, which has been collected in partnership with more than 75 global financial institutions and represents financial information on more than 17 million private companies around the world.
The score also takes into account information about economic conditions and how that might affect your ability to pay back your business’s debt. The economic factors are updated monthly, so it’s possible that your score could change even if you haven’t updated your financial information. This may happen because external economic factors affect your business and can influence your ability to make interest payments on your company’s credit.
How does knowing my MARQ score help me?
Understanding the financial position of your business is essential for success. If you are thinking about applying for a business loan or line of credit, the MARQ score will give you a view of how your lender will evaluate your financial information – it is based on the same models that many banks use to manage their risk. It will give you information on where you’re doing well and where you could improve, so you know where you stand before you apply, and provide tools to help you put your business in the best position to get the funding you need to grow and prosper. Learn more about how lenders evaluate creditworthiness.
Even if you’re not in the market for a loan, understanding the financial drivers of your business can help you make improvements to strengthen your business and be more profitable and successful. Seeing how you compare to similar businesses will help you target ways to improve your performance.
How do I interpret my MARQ score?
The median MARQ score across businesses in the Moody’s Analytics Credit Research Database is 76. A MARQ score above 83 puts you in the top quartile of businesses, which means your business is in the top 25% in terms of its likelihood of paying back its credit when compared to other private companies. MARQ scores below the median may indicate a higher level of credit risk.
MARQ scores vary by industry, because some types of business are inherently riskier than others. The meter showing your MARQ score also shows the median score for businesses in your industry and region to give you a sense of how you compare.
How do I improve my MARQ score?
The MARQ site includes a simulator that lets you see what happens to your MARQ score when you change certain factors. These changes can include things like managing your inventory level, reducing certain types of debt, or boosting sales growth. When you move the sliders in the simulator, you’ll see what your MARQ score would be and you can create an action plan that you can follow to help you move toward your targeted score.
Who can see my MARQ score?
If you got your MARQ score at www.MARQscore.com, no one can see it without your permission. You’re able to share your score with people inside or outside of your business if you choose, but to do so, you will need to grant them permission on the Business profile page in your account.
Lenders and other providers use the MARQ site to make it faster and easier for you to apply for a loan, so they may invite you to use the site to provide your financial information to them electronically. If you got your MARQ score in response to an invitation from a lender or other service provider, or if you see a provider’s logo on the site you’re using to get your MARQ score, that provider will be able to see your MARQ score and the information you submitted to the site. Your information won’t get sent over to a provider's systems unless you authorize it.
How is my MARQ score used by others?
You are in control of your MARQ score and how it is used. You can choose to share it with others in your business, your accountant, or your lender. Keep in mind that if you’re on a lender’s or other provider’s site (i.e., their logo is on the site), that lender or provider may use your MARQ score to help you put together an action plan, to pre-qualify you for a loan, or to consult with you on how to strengthen your business’s financial position.
The MARQ score is based on the same models that many banks use to manage their risk, so it will help you view your financial information like they do. Lenders will also consider factors other than the MARQ score in deciding whether or not to grant you credit, like how well you manage your business, the characteristics of your local market, and what type of collateral you have to back up your credit. The financial strength reflected by your MARQ score is not the only part of the picture, but it is an important part.
Does checking my MARQ score affect my credit score?
No, checking or updating your MARQ score does not affect your credit score or your financial position. Your MARQ score is based on the financial information you provide from your linked accounting system or via the manual options provided on the MARQ site. It also considers the industry of your business and external economic factors. The MARQ score does not consider credit inquiries on your business and it is not reported to any external credit bureaus. The score is provided to you as a resource to better understand the financial and credit position of your business, and you are in control of how it is used.
Can I share my MARQ score with my lender or another business?
If you got your MARQ score in response to an invitation from your lender to use the MARQ site or if you see a lender or provider’s logo on the site when you access it, that lender will be able to see your MARQ score.
If you got your score at www.MARQscore.com, you can invite other users to view and manage your account by granting them permission on the Business profile page.
How is MARQ score different from other business credit scores?
The MARQ score is based on the financial information you provide about your business on the MARQ site. It does not consider your personal (non-business) financial position or payment information reported to credit bureaus. Our research has shown that financial information about a business is the best predictor of the longer term probability that a business will pay off its credit, so that is the information we use to provide the score.
Is the MARQ score the same as a Moody’s credit rating?
No. Moody’s credit ratings are produced by Moody’s Investors Service, Inc., a separate entity. They are not connected to a MARQ score.
The MARQ score is a numeric indicator provided by Moody’s Analytics based on a model that statistically analyzes the financial data of private companies to estimate the probability of default on credit.
What should I do if my MARQ score seems wrong?
Your MARQ score is based on the financial information you provide from your linked accounting system or via the manual options on the MARQ site. If the score doesn't seem right, you should start by checking your financial information on the Financials section of your account. Note that the financial statements on the MARQ site might be slightly different from the ones you see in your accounting system. The MARQ site standardizes the information you provide in order to give you a MARQ score, and sometimes the standardized accounts will look a little different from yours, since every business is different. This standardization of account information has been developed with and reviewed by hundreds of professional accountants over several years. If, after confirming your financial information is correct, you still think there is a problem with your MARQ score, you can contact us with details of your question and we will be happy to investigate. Remember, your MARQ score and financial information are never sent to a lender or other provider’s systems without your authorization.
Who is Finagraph?
Moody’s Analytics has partnered with Finagraph to provide the MARQ portal. Finagraph is a best-in-class financial data collection and business intelligence company. Their pioneering technology gathers and organizes financials directly from accounting systems, providing financial professionals and business owners with clear and actionable information. The partnership between Moody’s Analytics and Finagraph brings together expertise in risk assessment with innovative technology to provide smart solutions for lenders and businesses. To learn more, visit www.finagraph.com.