Credit Reference

AAA

DEFINITION of 'Credit Reference'

A credit reference can be a report from a credit agency for either a business or an individual. The term can also be used to mean a letter from a bank or other financial institution with whom a company has done business, confirming to third party that the company or individual is known to the financial firm as a good client.

INVESTOPEDIA EXPLAINS 'Credit Reference'

Credit references are generally used to determine the creditworthiness of a person or individual. Credit agencies are used most often for this purpose, although individual letters of reference are sometimes necessary. For example, an overseas business wishing to establish its credentials in the United States may obtain a number of credit references from other businesses, banks, vendors and customers.

RELATED TERMS
  1. Credit Rating

    An assessment of the credit worthiness of a borrower in general ...
  2. Dun & Bradstreet - D&B

    A company that provides commercial credit information and reports ...
  3. Credit Score

    A statistically derived numeric expression of a person's creditworthiness ...
  4. Credit Report

    A detailed report of an individual's credit history prepared ...
  5. Credit Bureau

    An agency that researches and collects individual credit information ...
  6. Jamming

    A scam perpetrated by bogus credit repair firms that involves ...
RELATED FAQS
  1. How can I tell if a security is considered investment grade?

    It is possible to tell if a security is considered to be investment grade by looking at that security's ratings with either ... Read Full Answer >>
  2. How do I transfer my credit card history from one country to another?

    It is currently not possible to transfer your credit history to another country if you relocate. The credit metrics used ... Read Full Answer >>
  3. What do creditors have to report to credit bureaus?

    Creditors are not required by law to report anything to credit bureaus, although many businesses choose to report on-time ... Read Full Answer >>
  4. Does shopping for the best interest rate affect my credit score?

    Shopping for interest rates does not necessarily affect a person's credit score. When a borrower submits an application to ... Read Full Answer >>
  5. How can a creditor improve its Average Collection Period?

    In accounts receivable management, the average collection period refers to the amount of time it takes for a creditor to ... Read Full Answer >>
  6. When are you legally required to get a letter of credit?

    You are legally required to obtain a letter of credit to guarantee a successful and risk-free transaction when dealing in ... Read Full Answer >>
Related Articles
  1. Credit & Loans

    5 Keys To Unlocking A Better Credit Score

    Follow these tips and techniques to rebuild a ruined credit rating.
  2. Credit & Loans

    What's On A Consumer Credit Report?

    A look at the various components and considerations that go into one's credit report and credit score.
  3. Credit & Loans

    Check Your Credit Report

    Make sure there are no errors holding you back from obtaining a loan.
  4. Personal Finance

    The Debt Ratings Debate

    Lack of competition and potential conflicts of interest have called the value of these ratings into question.
  5. Options & Futures

    6 Major Credit Card Mistakes

    Avoid these pitfalls to keep your credit score healthy and your debt under control.
  6. Credit & Loans

    Free Credit Score: How Free Is It Really?

    Be careful of websites making bogus offers of "free" credit scores. If a site asks for credit card information, you'll most likely end up being charged.
  7. Credit & Loans

    How To Increase Your Appeal To Prospective Lenders

    Making a business eligible for loans/credit cards at the best possible rates requires crafting an excellent credit profile through the smart use of credit.
  8. Credit & Loans

    Is My Credit Score Useful Outside The U.S?

    If you're hoping that your credit score will follow you overseas – or worried that it will– here's a quick primer on how your score will add up abroad.
  9. Credit & Loans

    New Rules That Could Trash (or Help) Your Credit

    Cable bills and similar financial obligations will soon be factored into your credit score. Good news if you're an on-time payer. If not, become one!
  10. Economics

    The Fed's Impact On Emerging Markets

    Higher US interest rates could make it more expensive for emerging market borrowers to service their debt commitments.

You May Also Like

Hot Definitions
  1. Hedging Transaction

    A type of transaction that limits investment risk with the use of derivatives, such as options and futures contracts. Hedging ...
  2. Bogey

    A buzzword that refers to a benchmark used to evaluate a fund's performance. The benchmark is an index that reflects the ...
  3. Xetra

    An all-electronic trading system based in Frankfurt, Germany. Launched in 1997 and operated by the Deutsche Börse, the Xetra ...
  4. Nuncupative Will

    A verbal will that must have two witnesses and can only deal with the distribution of personal property. A nuncupative will ...
  5. OsMA

    An abbreviation for Oscillator - Moving Average. OsMA is used in technical analysis to represent the variance between an ...
  6. Investopedia

    One of the best-known sources of financial information on the internet. Investopedia is a resource for investors, consumers ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!