Whether you’re a new business owner, a freelancer or an established business owner, a business credit card is essential. Business credit cards can help you keep your finances organized, earn rewards on purchases or grow your business’s credit. The process for getting a business credit card is similar to getting a personal one, but you might need to give issuers more information.
Here’s some information you may need to have handy when applying for a business card:
Though you might be able to apply without an EIN, having one can be helpful for your application. Nancy Parnella, director of the Barclays U.S. business credit card program, explains that having an EIN can allow for quicker approval of your application.
“Most business owners should have an EIN as it allows them to keep their personal and business finances separate,” Parnella says. “This is also advantageous when applying for a business credit card as it aids in verifying the business, which can expedite approval.”
Here are a few questions to ask to help you evaluate the best type of card that will benefit your business most:
Most major issuers will let you check if you prequalify for their business credit cards. You can visit the issuer’s site to find out how to get prequalified for your chosen credit card.
Getting prequalified for a credit card doesn’t guarantee approval, however. It helps you see your chances of getting approved for a credit card while avoiding a hard credit inquiry. If you don’t get prequalified, improving your credit score or applying for a business card for bad credit may be the next best option.
The final step to getting a business credit card is filling out an application for that card. The easiest way to apply for a business credit card is online, where you’ll submit your financial information and likely receive an instant decision.
Depending on which card and issuer you apply for, you may not receive your card for up to 10 days. If you’re planning to use the card to pay off a big purchase, plan ahead and apply for your card before you need it.
Applying for a new credit card may cause a temporary drop in your credit score. If your business needs something else that requires a credit check, like a business loan or new office space, consider applying for it first.
“Business” doesn’t have to mean a multimillion-dollar enterprise. Whether you operate an existing business with established revenue or you’re just starting a new business and have a reasonable expectation of revenue, you can apply for a business credit card. Eligible businesses could include selling handcrafts on Etsy, writing freelance articles for a website or doing yard work for neighbors.
If you’re a sole proprietor, you can apply for a business credit card using your Social Security number. Just note that you do need a business of some sort; issuers don’t want you to apply for a business card if you have no actual business.
Typically, a small business card requires a personal guarantee (meaning you’re personally responsible for what’s charged to the card) and a personal credit check. You could be turned down for the business card due to a poor personal credit score.
For that reason, it’s wise to check your personal credit score before applying for a business card. You’re also entitled by law to one free copy of your credit report from each of the three consumer credit bureaus (Equifax, Experian and TransUnion) weekly via annualcreditreport.comannualcreditreport.com. You can check for and dispute any legitimate errors that may be dragging your score down.
If you’re turned down after applying for a mainstream business credit card, getting a secured business card might provide an opportunity to build up good business credit history. Know that you’ll have to pay a security deposit, and you may have to pay an annual fee as well.
Generally, a business credit card won’t appear on your personal credit report. Discover is one exception, as it reports business card activity to the consumer credit bureaus.
However, if you are significantly late paying your business card bill — from any issuer — it’s likely to be reported to your personal credit report and can damage your personal credit score.
That’s because as was mentioned earlier, most small business credit cards require a personal guarantee, meaning you are the one ultimately responsible for making sure the card is paid up.
Based on our research of business cards available through LendingTree, as well as from top issuers, we’ve selected some of the best options for a variety of needs.
How LendingTree Rates Credit Cards?
Our experts rate credit cards based on several factors including card benefits, bonus offers and independent research. Credit card issuers do not influence or have a say in our card ratings. Read our credit card methodology here.Rewards rate: 1.5% - 5% Cash Back
The Capital One Spark Cash Select lets you earn a generous sign-up bonus and solid rewards rate for a $0 annual fee. You’ll earn $500 Cash Back once you spend $4,500 on purchases within the first 3 months from account opening. Plus, its flat cash back rewards rate helps business owners understand how much they’ll earn with every purchase.
How LendingTree Rates Credit Cards?
Our experts rate credit cards based on several factors including card benefits, bonus offers and independent research. Credit card issuers do not influence or have a say in our card ratings. Read our credit card methodology here.Rewards rate: 1x – 3x
The Ink Business Preferred® Credit Card offers an excellent rewards rate — especially on common business expenses. Its elevated rewards and valuable sign-up bonus can help you pay off the $95 annual fee.
How LendingTree Rates Credit Cards?
Our experts rate credit cards based on several factors including card benefits, bonus offers and independent research. Credit card issuers do not influence or have a say in our card ratings. Read our credit card methodology here.Rewards rate: 1x – 4x
The American Express® Business Gold Card has a unique rewards rate that allows you to earn the most on what you spend the most on. Your two most elevated rewards categories can vary between categories like U.S. media providers, U.S. restaurants, transit and more. This is best for businesses that have fluctuating expenses throughout the year.
The card has a $375 annual fee, but it also has a welcome offer and other benefits to help you recoup the cost.
If your personal or business credit score is less than stellar, you might have trouble qualifying for some higher-end business credit cards. However, there are a few business credit cards for bad credit. Most are secured credit cards that require you to submit $500 to $25,000 to the issuer as a security deposit.
Below is one of the best secured business cards for people with lower credit scores:
How LendingTree Rates Credit Cards?
Our experts rate credit cards based on several factors including card benefits, bonus offers and independent research. Credit card issuers do not influence or have a say in our card ratings. Read our credit card methodology here.Rewards rate: 1.5% cash back
The Business Advantage Unlimited Cash Rewards Secured credit card is a simple rewards card for business owners with lower or limited credit scores. The card is secured, which means you’ll have to submit a minimum security deposit of at least $1,000 which will act as your credit limit. You can build credit while earning cash back on every purchase for your business.
You should have at least some kind of business income, or the expectation that you will earn business income, before applying. You don’t necessarily have to run a full-fledged business with a storefront and employees, however — something as simple as doing freelance work from time to time could allow you to qualify.
There isn’t a set amount of revenue your business must generate to qualify for a business credit card. It’s possible to get approved for a business card as a sole proprietor with relatively modest revenue, or even an estimate of expected revenue if your business is new and you don’t have numbers for a whole year yet.
The best practice is to keep business and personal expenses separate — use a business card for business expenses and a personal credit card for personal expenses. That way, if you ever need to produce records documenting your business expenses, they aren’t jumbled together with personal purchases.
If you run a business, whether it’s a big operation with several employees or just you selling products on eBay or Etsy, getting a business credit card is a smart move. It allows you to separate personal spending from business spending, makes it easier to track expenses and typically protects your finances better in cases of fraud than a debit card.
Yes, as a sole proprietor you can apply for a business credit card. Just note you can be denied for a variety of reasons, as with any credit card application.
In general, with charge cards you must pay off your card’s balance within a billing cycle, whereas a credit card allows you to roll over a balance from month to month. The benefit of a charge card is that you may have a flexible spending limit, whereas credit cards come with a set credit limit you typically can’t exceed.
In selecting the business cards recommended here, we evaluated rewards programs for a variety of different spending habits. We also weighed welcome offers and benefits such as free employee cards.
In one instance, a selection was made based on availability to applicants with poor / fair credit.
Finally, annual fees were considered. Those cards that charge an annual fee offer enough value in rewards and benefits that business owners in some situations will find them worthwhile despite the cost of the fee.
To see rates & fees for American Express cards mentioned on this page, visit the links provided below:
For Capital One products listed on this page, some of the benefits may be provided by Visa® or Mastercard® and may vary by product. See the respective Guide to Benefits for details, as terms and exclusions apply
The information related to the Business Advantage Unlimited Cash Rewards Secured credit card has been independently collected by LendingTree and has not been reviewed or provided by the issuer of this card prior to publication. Terms apply.
The content above is not provided by any issuer. Any opinions expressed are those of LendingTree alone and have not been reviewed, approved, or otherwise endorsed by any issuer. The offers and/or promotions mentioned above may have changed, expired, or are no longer available. Check the issuer's website for more details.
