Our pick for businesses: Ink Business Cash® Credit Card
$900
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Use our table to compare business credit cards and find the most useful option for your company's needs. To start, select your credit score, select the features you want and the rewards type. Finally, select a specific card issuer if you have one in mind and browse through the selection of cards.
Think about your business spending and cash flow when weighing business card factors that include:
A business credit card is just like a regular credit card but with tools specifically designed to help you streamline and manage your business spending. These tools can range from rewards or cash back for business expenses like office supplies or travel perks for employees on the move.
Also, set spending controls for each employee and monitor their card activity. This can help you streamline your finances and avoid card misuse.
Here’s how to get started with a business card:
Here’s one reason you might use a personal credit card over a business card: Personal cards have more consumer protections from the Credit CARD Act of 2009. These are a few advantages they have that business cards don’t:
If you want a business card, gauge your ability to pay off your debt. The better prepared you are, the more likely you’ll be able to roll with the punches if your provider changes your card terms.
| Business credit card | Personal credit card | |
|---|---|---|
| Credit limit | Typically higher credit limits, depending on creditworthiness | Typically lower credit limits, depending on creditworthiness |
| Rewards |
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| Spending controls |
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| Build your credit score |
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| Consumer protections |
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| Personal guarantee | Likely requires a personal guarantee | Personally responsible for debt incurred, along with any cosigners |
Establishing business credit involves a few steps, but it can be relatively simple. Follow these instructions and you’ll be well on your way to getting your business credit scores.
The first step to getting your business credit is to legally separate your personal and business finances. Do this by establishing a limited liability company (LLC), a C corporation or an S corporation. If you’re not sure which to choose, read our guide on how to settle on the right business structure.
After you’ve incorporated, it’s time to get a few more details squared away before you can start building business credit:
There are three main commercial credit bureaus: Dun & Bradstreet, Experian and Equifax. Each evaluates your business credit by compiling information from legal filings, public records and creditors who work with you. Then, they give you numerical business credit scores — typically 0 to 100, with the higher end meaning higher creditworthiness.
You’ll want to establish credit files with each of them:
Here are two of the easiest and most common ways to start building business credit:
Net-30 accounts — that is, those that give you 30 days to pay off purchases — are often good avenues to establish tradelines. These include vendors such as Uline, Summa Office Supplies, Quill, Grainger and Crown Office Supplies.
Each credit agency evaluates a different mix of factors when determining your credit score. However, one of the easiest ways to consistently grow your score is by making payments on time.
Late payments negatively affect your business credit. To avoid that, set alerts or automate your credit card payments. If you consistently pay early and in full, Dun & Bradstreet will likely assign you a perfect score.
The balances you carry on your business credit cards can also affect your credit score. Keep an eye on your credit utilization ratio — that is, watch your balances relative to your total credit. The higher the ratio is, the higher risk credit agencies will assign to you defaulting on your debt. It’s generally recommended to keep your credit utilization ratio under 25% to 30%.
If you’ve got a perfect payment history, working with lenders that report to business credit bureaus can further help you establish your business credit. Before applying or a loan, check with the lender that your payment history will be reported to the credit agencies.
Also, try not to borrow more than you can pay off. Same goes for your credit card limit — don’t use it all at once if you can’t pay it off. With timely payments and responsible borrowing practices, your business credit will improve.
Open new credit accounts responsibly, and pay off what you owe. Update your information with all three of the largest business credit bureaus since you don’t know which bureau a lender will pull your credit from.
Aside from payment history, credit bureaus keep public records, such as bankruptcies, liens and judgments. These records factor into your business scores as well, and can stain your business credit for up to 10 years. Avoid them as much as possible and you’ll help protect your fast-growing track record.
If you’re worried you can’t get a business card with no or bad credit, first be clear on which type of credit you lack — personal or business credit.
You can likely still get an unsecured business credit card without a business credit score. A provider will look at your personal credit score when deciding whether or not to approve you.
It’s more difficult to get an unsecured business card without a personal credit score or with bad credit. A provider might not check your personal credit if you have strong business credit.
If you don’t immediately need a business credit card, start building your personal credit with a credit-building card. Once you improve your personal credit score, you can apply for most business credit cards.
A majority of business credit cards will check your personal or business credit before you can qualify. However, the Brex for Startups card is a new card that won’t check your personal credit. Instead, this card checks your personal income and other financial factors to determine eligibility.
There are a fair number of business cards for bad credit that you might find more obtainable than other business cards. Still, here are a few tips to find one you’re most likely to qualify for.
There are plenty of benefits to using a business card instead of a personal card. A business card can help you separate your personal spending from your business spending. While it may be tempting to rely on your personal credit card for business expenses — especially when you’re only starting out — this can have several unintended consequences. For example, separating your personal spending from your business spending can help you easily differentiate expenses and sort deductions come tax season.
Plus, a separate credit card for your business helps protect your personal assets if your business is incorporated and you find yourself facing a lawsuit. And even if your business isn’t entirely official, a business card offers other perks too:
Yes. In fact, freelancers and private contractors are eligible for business credit cards as long as they can prove their income.
While different card providers have different eligibility criteria, you should be prepared to offer the following information when you apply for a business credit card:
The size of the company these cards are meant for is the main differences between corporate and small business credit cards. This table explains a few other key differences.
| Corporate credit cards | Small business credit cards | |
|---|---|---|
| Who are they for? | Issued to large companies and corporations with more than $1 million in revenue. | Designed for the small business owner with one or two employees with access to a company credit card. |
| Who is liable? | The company is entirely liable for all debt. Before issuing the card, the bank reviews the company’s finances and uses some of its assets as collateral. However, some banks will tailor cards allowing you to choose your liability options. | In most cases, you’re personally liable for any debt you incur on these business cards. |
| Do they report to personal credit? | No. Your personal credit won’t be affected. Instead, all card activity is reported to business credit bureaus. | Depending on which card you choose, the bank may report to personal and business credit bureaus. Your personal credit can take a hit if your business runs into financial trouble. |
Corporate cards aren’t always limited to private entities. Government agencies and nonprofit organizations could find these cards helpful as well.
What’s suitable for your business in its infancy may not work long-term — especially if your business experiences rapid growth or a sudden change in trajectory. One reason you may want to consider swapping card providers is if your business has outgrown your current card’s credit limit. Or perhaps your business checking account is stationed with another bank and there are perks or incentives for combining your accounts.
A practical way to evaluate whether your current card serves the needs of your company is by reviewing your business expenses and spending habits. Does your current card offer perks and rewards that benefit your business? Would it be possible to snag a lower APR by switching providers?
Just because a particular card worked for your startup doesn’t mean it will continue to work for your business two, three, five or ten years down the road. The bottom line? Don’t be afraid to switch it up.
Here’s a quick side-by-side look at some of the cashback business cards available.
Here are our top picks for 2021.
Ensure your personal assets remain secure while still getting your business the credit it needs.