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Business balance transfer credit cards
While 0% balance transfer cards might be commonplace in the world of personal credit cards, this is not the case with business credit cards.
Switching to a new business credit card issuer could help your company take advantage of better features or more favourable terms. However those familiar with lengthy 0% balance transfer offers for their personal cards might be disappointed to find that the business equivalents of these are extremely hard to find. If you’re a sole trader, you might opt to take out a personal balance transfer card.
The good news is that business balance transfer deals are available – you can compare some popular options in the table below.
Some card issuers, such as HSBC, simply state that the availability of balance transfer facilities is at their discretion.
What's in this guide?
Compare business credit cards with balance transfer facilities
Table: sorted by representative APR, promoted deals first
Updated April 8th, 2020
How to compare balance transfer business credit cards
When comparing business credit cards for balance transfers, consider the following:
- Balance transfer rate. What interest rate applies to balance transfers, and is it an ongoing rate or an introductory rate? If it’s an introductory rate, how long does it last, and what rate does it revert to?
- Balance transfer fee. Regardless of whether or not the card has a balance transfer promotion, there will likely be a balance transfer fee to consider. This is typically 2–4% of the amount that you wish to transfer. You can use the balance transfer fee in conjunction with the rate to get a better idea of how much you’ll pay overall.
- Balance transfer limit. You’ll typically be able to transfer up to a maximum of 90% or 95% of your credit limit. This is known as the card’s balance transfer limit. The credit limit that you are offered will be tailored to your business, taking into account factors like turnover, credit record and how long the business has been trading.
- Fees and charges. Most business cards come with an annual or monthly fee, which can be relative to the number of cardholders. In some cases this fee is waived in the first year.
- Features and benefits. Business credit cards tend to be focused on rewards and cashflow management. As such, it’s worth looking at your company spending habits, and how the card you’re considering might help you track this or help you to benefit from it.
- Eligibility. Check the card issuer’s minimum eligibility criteria before you apply. There are commonly stipulations around turnover, company type and years trading.
Pros and cons of business balance transfer credit cards
Pros
- Could save your business money. With a low rate, you’ll naturally stand to save on unnecessary interest.
- Can simplify finances. Transferring multiple credit card balances over to one balance transfer card can consolidate your monthly payments into just one bill.
- Additional features and benefits. You could enjoy travel perks, cashback rewards, analytics/reporting and more with your new business card.
Cons
- Your interest rate could be higher in the long-run. Look out for cards with a low introductory rate followed by a punishingly high standard rate.
- Fees. Don’t forget to factor in annual/monthly fees, balance transfer fees etc.
- Your credit score could take a dip. Whenever you apply for a credit card, the issuer does a hard pull on your credit report, which likely causes a slight (and usually short-lived) drop in your credit score.
How to choose between a personal and business balance transfer credit card
Wondering whether you can use a personal credit card for business purposes? The short answer is yes — and there are a few big points that could impact your decision.
- Promotional rates. Introductory low or 0% rates are more prevalent in personal cards.
- Spending power. Company credit cards tend to have higher credit limits.
- Features and benefits. Business cards usually have features and benefits that are tailored to businesses. Shocker!
- Users. Adding multiple users is usually easier to do with a business credit card.
- Implications. The responsibility for all debt rests with the account holder.
Can I transfer debt from a personal credit card to a business balance transfer credit card?
Yes, if you’ve been using a personal credit card for your business and want to transfer the balance over to your new business credit card, you can. However, you generally can’t get promotional balance transfer deals when you transfer balances within the same banking group.
How to manage a business balance transfer credit card
So you got a business balance transfer credit card. What’s next? Here are a few things to keep in mind when managing your card:
- Confirm your balance transfer has been processed. Many business balance transfer credit cards take up to 14 days to process a balance transfer request. After two weeks, call your old credit card issuers to make sure they’ve been paid off by your new credit card provider.
- Make timely payments. A lot of credit card providers allow you to sign up for direct debits, making paying your credit card bill one less thing on your business’s monthly to-do list.
- If possible, avoid using your card to make new purchases. If you got the business balance transfer credit card to pay off your business’s debt faster and more cheaply, try to avoid using the card for new purchases until after you’ve paid down the balance.
- Avoid fees. Many credit card providers charge late and returned payment fees, as well as fees on cash advances, foreign transactions and balance transfers. Read the terms and conditions of the credit card to understand the costs you could incur.
- Contact customer service. Keep an eye on your bill, and reach out to your credit card provider if you notice any problems.
Bottom line
A business balance transfer credit card can be useful for managing your company’s finances, but there are some traps to watch out for. Be sure to compare all available options and make the necessary calculations before deciding which card is best suited for your business’s needs.
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