Business Loans

Business Credit Cards Without A Personal Credit Check

best secured business credit cards

Owning a business is a huge part of your life, but it shouldn’t dominate your personal finances. When possible, it’s wise to keep business credit separate, because it can lower your personal credit score. Find out how to get a business credit card without affecting your individual finances.

Can you get a business credit card without a personal credit check?

Gerri Detweiler, education director at Nav, a company that assists business owners in building strong business credit for free, said she is unaware of any major credit card issuers that don’t perform a personal credit check on business owners.

“In addition, they all will require a personal guarantee from the owner,” Detweiler said. “That means if the business fails and does not repay the credit card debt, the issuer can try to collect from the business owner directly.”

Your personal credit score might also take a hit during the application process.

“When a credit card issuer checks your personal credit, it will create an inquiry and that could affect your credit score by a few points,” she said. “However, the typical inquiry will only shave off three to seven points from a credit score.”

Despite this, getting a business credit card can be a smart move for your company.

“One advantage of the fact that issuers check personal credit is that they often make business credit cards available to young businesses as well as businesses that may not be generating significant revenue,” Detweiler said. “In other words, if your personal credit scores are strong and you have enough income from all sources, you may be able to qualify for a business credit card even if your business is new or is not yet profitable.”

How to get a business credit card without a personal credit check

But what if your personal credit score is poor? If you’re trying to avoid the personal credit check that most business credit cards require, you could consider a prepaid card. Different from a bank debit card or a traditional credit card, these cards may offer some of the same perks as traditional credit cards such as travel assistance and rebates at certain businesses. Some are advertised as business prepaid cards with the ability to issue additional cards to employees.

Get a prepaid business card

The most important distinction of a prepaid card is that they typically require no credit check and, sometimes, no linked bank account. If that’s your goal, a prepaid business debit card could be a great solution for your company. But keep in mind, card activity won’t be reported to the major credit bureaus, so it won’t help you build — or repair — credit, which is important in the long run. We’ll talk more about that in a minute.

Prepaid business cards

Small Business Prepaid Card

This card by Mastercard requires no credit check or linked bank account and offers perks such as rental insurance and warranty insurance, protection against theft on new items purchased with your card and travel assistance. However, it’s unclear from the Mastercard website if there’s an annual fee, how much money users may load on to the card at a time and how many additional cards are available to employees.

Netspend Small Business Prepaid Mastercard

The Netspend Small Business Prepaid Mastercard allows you to separate business and personal finances. The card comes with a $9.95 monthly fee and you can add up to 10 sub-account holders for an additional monthly fee of $1.95 per additional user. You may have to pay a fee at one of Netspend’s reload locations to add money to your account. The minimum users can add is $10 with a maximum of $15,000 in a 30-day period. Netspend caps accounts at $25,000.

dash

The dash prepaid Mastercard makes it easy to manage business expenses. Simply invite your employees to get a card and the rest is taken care of for you, though it’s unclear from the dash website if there’s a cap on the number of employee cards. When employees need money, they enter the amount and describe the reason for the funds. You have the power to accept or reject the request, and view each person’s spending history. You can also add and remove funds to each card as needed and set individual approval limits.

You’ll need a bank account for the dash prepaid Mastercard. It has no account maintenance fees, but there is a 3% foreign transaction fee. Other additional services, including the issuance of a monthly paper statement, are available for a fee. Your account balance may not exceed $100,000.

Bento

A Visa business debit card, the Bento for Business Card is funded by your bank account. Get up to two cards for free, 10 cards for $29 a month, up to 25 cards for $69 a month or an unlimited number of cards for $149 a month. Spending is capped at $25,000 per day.

Pex

Fund your PEX Visa Prepaid Card through a bank account or a wire transfer. PEX doesn’t set a maximum dollar amount, but each employee card tops out at $25,000. Up to 10 cards can be shipped before your account is funded. Afterward, you can order as many cards as you need.

Fees for the PEX Visa Prepaid Card vary by account type. Setup fees start at $49.95, monthly subscription fees are as low as $75, and each additional card is $4 or less.

Other ways to get a business credit card without a personal credit check

If you have a good credit score but want to avoid personal liability on a traditional business credit card or simply want to untangle your business finances from your personal ones, there are a few nontraditional approaches you can take to truly separate the two entities.

Apply with your EIN

Your EIN — Employer Identification Number — is essentially a Social Security number for your business, so use it on business credit card applications. If you don’t already have an EIN, visit the Internal Revenue Service website to get one.

As long as you have a valid Taxpayer Identification Number, you’re eligible to apply for an EIN, assuming your principal business location is in the U.S. or U.S. territories. Complete the application online and, if approved, you’ll receive your EIN immediately.

Business credit cards that allow for EIN only may be reserved for those customers who have already shown creditworthiness or for larger or more established businesses pursuing corporate credit cards.

Build solid business credit

This brings us back to the importance of establishing good credit — both personal and business credit. Setting up an individual credit report for your business is essential, because it’s becoming common for creditors and suppliers to use this information when making lending and credit decisions — although personal credit might still be checked — according to credit bureau Experian. When you’ve established strong business credit, you can apply for lines of credit in your company name. Beyond other benefits, the credit reporting agency notes this can increase your company’s available credit and allow it to obtain better credit terms. We’ll give some tips on how to improve your business credit below.

Once you have strong credit, you may want to consider traditional business credit cards, which may be attractive for their cashback or airline rewards or 0% intro APR financing. Cards that report activity to business credit bureaus may help you build business credit, allowing you to separate personal finances from business ones.

Business credit cards

American Express
Credit check with consumer credit bureaus Credit check with business credit bureaus Card activity reported to consumer credit bureaus Card activity reported to business credit bureaus
Yes Yes No Yes

 

Bank of America
Credit check with consumer credit bureaus Credit check with business credit bureaus Card activity reported to consumer credit bureaus Card activity reported to business credit bureaus
Yes Yes No Yes

 

Barclays
Credit check with consumer credit bureaus Credit check with business credit bureaus Card activity reported to consumer credit bureaus Card activity reported to business credit bureaus
Yes Yes No No

 

Capital One
Credit check with consumer credit bureaus Credit check with business credit bureaus Card activity reported to consumer credit bureaus Card activity reported to business credit bureaus
Yes Yes Yes Yes

 

Chase
Credit check with consumer credit bureaus Credit check with business credit bureaus Card activity reported to consumer credit bureaus Card activity reported to business credit bureaus
Yes Yes Yes Yes

 

Citibank
Credit check with consumer credit bureaus Credit check with business credit bureaus Card activity reported to consumer credit bureaus Card activity reported to business credit bureaus
Yes Yes Yes Yes

 

Wells Fargo
Credit check with consumer credit bureaus Credit check with business credit bureaus Card activity reported to consumer credit bureaus Card activity reported to business credit bureaus
Yes Yes No Yes

How to establish business credit: 5 tips

As noted above — in some cases — building business credit can help create a clear divide between personal and company finances. Here are five tips to help you form a solid foundation for your business.

1. Open accounts with companies that report payment history

“The fastest way to build business credit is to establish accounts with companies that report payment history and then pay on time,” Detweiler said. “Not all business lenders and vendors report, so you often must be proactive about it.”

She said a few vendors that report payment history include Grainger, Uline and Quill. As noted above, American Express, Bank of America, Capital One, Chase, Citibank and Wells Fargo also report card activity to business credit bureaus, such as Dun & Bradstreet, PayNet, Experian Business and Equifax.

2. Pay bills on time

Likely the most important factor in building and maintaining good credit, according to Nav, making bill payments on time shows that your business can be counted on. Not only do late payments send the message that your company can’t manage debt, it also lowers your credit score.

3. Keep close tabs on your business credit

Carefully monitoring your credit report can help you spot errors in a timely manner. These mistakes are probably more common than you realize, as Nav revealed that 25% of small-business owners have found major errors on their credit reports. If you find any inconsistencies, promptly contact the credit reporting agency.

4. Incorporate your business

Make sure your company is viewed as a separate business entity by incorporating it or forming a limited liability corporation, Experian recommended. An LLC offers the limited liability of a corporation and the tax benefits and functional flexibility of a partnership, according to the U.S. Small Business Administration. Some other standard ways to structure a company include an S corporation, a C corporation, partnership and a cooperative.

5. Get a business phone number

It might sound like basic advice, but having a separate phone line set up in the name of your company and getting it listed will help establish business credit, according to Experian. Yellowpages.com allows you to list your business for free and offers a complimentary tool that will verify the accuracy of your company listing on Google and other popular sites.

The bottom line

Obtaining a business credit card can be a wise move for your company, but most major credit card issuers will perform a personal credit check. However, there are a few creative ways to get around this if you want to keep your business and personal credit entirely separate. Weigh the pros and cons of each route to decide what’s best for both you and your business.

The rates and fees mentioned in this article are accurate as of the date of publishing.

 

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