When a party requests your credit report from a CRA, they must provide a statement of their permissible purpose for the inquiry, which must be one or more of the reasons set forth under FCRA 604.
The FCRA permits inquiries for business purposes other than the extension of credit to the consumer.
One of the stated permissible purposes is that the inquiry relates to a business transaction for which there is a legitimate business need for the business to review your credit as part of their approval process. Notable examples are apartment rentals, utilities, and bank accounts.
Internal account reviews by creditors pertaining to existing accounts and by debt collectors, which are unrelated to both new credit or business transactions, are also permissible,
Each permissible purpose has its own code, so yes, business purpose inquiries are coded different than consumer-initiated requests for credit.
The permissible purpose code can also result in certain types of inquiries automatically being coded as soft, and thus are not seen by anyone else other than the named consumer, and thus excluded from scoring. Typical examples are internal account reviews and consumer pulls of their own reports.
You can see the codes yourself if you obtain one of the more comprehensive credit reports, such as the government-sanctioned reports obtained via annualcreditreport.com
