Best business credit cards for startups

Startups are in many ways different from established businesses. Their credit needs are no exception.

If you own a startup and are looking for a business credit card, you’ll want one that can help you even out your cash flow if you’re having a rough month, while offering a low rate if you need to occasionally carry a balance and maybe even earning you rewards on your spending. Most importantly, you want to spend as little time as possible managing your credit card – you’re busy enough running your business.

Now, we can’t guarantee you’ll get all that, but here are a few suggestions on how to find a good credit card for your startup.

Best business credit card for startups: Earn rewards on all your credit card spending

Capital On Tap currently has one of the best range of offers in the business credit card space. All its cards come with a certain number of free supplementary cards you can give to other members of your team, charge no foreign transaction fees and can be automatically integrated with popular accounting software Xero.

You can choose between getting a standard credit card that offers no rewards but also has no annual fees, or upgrading to one of Capital On Tap’s two rewards credit cards. These come with a juicy introductory bonus and allow you to choose between earning Avios points (for frequent travellers) or cashback on all your spending.

Earn uncapped Avios or cashback on business spending

• Up to 1% cashback or 1 Avios per pound spent
• Up to 10,000 bonus points when you spend £5,000 in 3 months
• Up to 20 free supplementary cards
• Up to 56 interest-free days on purchases each billing cycle

Representative example: When you spend £1,200 at a purchase rate of 39.41% (variable) p.a., your representative rate is 39.9% APR (variable).

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• Is a rewards credit card a good idea for my startup?

  Good rewards business credit cards almost invariably charge an annual fee, so it’s all about how much you envisage using the card. Maths is your friend. Calculate how much you think you can earn in cashback or rewards and, if it outweighs the annual fee, it’s probably worth it.

• How do I find the best reward credit card for my business?

  Ideally, you want the highest possible earn-rate for the lowest possible annual fee. You also want to choose the right rewards: for example, if you don’t travel by plane very often, you won’t know what to do with Avios points. Compare all business credit cards on this page to see what else is available on the market.

How to compare business credit cards for startups

Business credit cards have many different features and it may be hard to find one that ticks all the boxes. You’ll have to figure out which to prioritise. Here’s a list of things you may want to consider while comparing products:

• Annual fee. This is the annual cost of your credit card, no matter how much you use it. You’ll have to include it in your budget, so it’s a core factor to look at.
• Interest rate on purchases. If you’re positive you’ll pay your credit card bill in full every month, this is a secondary concern. But if you think you may end up carrying a balance on the card every now and then, this is very important because it tells you how much borrowing money with the card will cost your startup.
• Facilities. Can the card be managed online or from your smartphone? Is the app good? Can you connect it to your accounting software? This is of utmost importance if you own a startup because it can save you a considerable amount of time.
• Rewards. These are for startups that plan to spend quite a lot on the credit card.
• Additional cards. If you’re planning to give a card to other people in your team, don’t forget to check how much it’s going to cost you.
• Foreign transaction fees. If you travel often for business purposes, you absolutely want a credit card with no foreign transaction fees. Most business cards charge 3% of every transaction, which can easily amount to a small fortune in fees if you’re not careful.

Considering all these factors and figuring out which matter most to you will help you choose a credit card that works for your business. Ultimately, you want something that’s as tailored as possible to how you and your team work.

Frequently asked questions

• Is my startup eligible for a credit card?

  It depends on a number of factors. Check the eligibility criteria first, then use an eligibility checker to determine your chances of being accepted for the card you’re considering. You’ll be asked to enter your business’s details. Eligibility checkers only run a “soft” search on your credit report that won’t impact your credit score.

• My business is very new and my credit score isn't great. What can I do?

  Getting a business credit card can be harder and you may be offered a worse rate and a lower credit limit. You still have some options though. This guide tells you a bit more about applying for a business credit card with bad credit.

• Am I personally responsible for the debt on my business credit card?

  You are if you signed a personal guarantee. They’re fairly common, but there are also some business cards that don’t require one.