Credit cards for business expenses

Looking for a credit card to cover your everyday business expenses? Here’s what you need to know.

Using a business expense card can be a convenient way to manage company or employee expenses. But how exactly do they work and how do you choose the right card for your company?

What is a business expense card?

A business expense card is a type of business credit card that enables employees to cover costs incurred while they carry out their jobs. This could include travel costs, hotel accommodation or marketing expenses, for example.

Businesses can usually issue a business expense card to anyone who needs one and then manage them from a central account. Companies can usually set different spending limits for their employees, depending on the type of role they are in and the type of expenses they might need to pay for.

How to choose your business expense card

As with any type of credit card, the best way to choose the right business expense card is to shop around using a comparison service and compare your options.

Consider which factors are the most important to you when weighing up which card to choose. For example, if you travel regularly, you might want to look for a card that offers low or no fees for foreign transactions. Or if you regularly need to pay for expensive items, look for a card with a higher credit limit and lower interest rate.

Name Product Purchases Annual/monthly fees Rewards earn rate Representative APR Link Key benefit Representative example
CASHBACK
Capital on Tap Business Credit Card
26.4%
£0
1 point per £1 spent
29.9% APR (variable)
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Earn 1% cashback for every £1 spent. Upgrade to Capital on Tap Business Rewards Card for £99 pa to choose between earning cashback or Avios and receive 10,000 bonus points when you spend £5,000 on your card in your first 3 months.
Representative example: When you spend £1,200 at a purchase rate of 26.4% (variable) p.a., your representative rate is 29.9% APR (variable).
NatWest Business Credit Card (only available to existing business customers)
16.9%
Year 1 - £0, Year 2 onwards - £30 per annum
N/A
24.3% APR (variable)
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Representative example: When you spend £1,200 at a purchase rate of 16.9% (variable) p.a. with a fee of Year 1 - £0, Year 2 onwards - £30 per annum, your representative rate is 24.3% APR (variable).
AVIOS
Capital on Tap Business Rewards Credit Card
26.4%
£99
1 point per £1 spent
29.9% APR (variable)
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Earn points on all card spend. Points can be redeemed for Avios or 1% cashback. 10,000 bonus points when £5,000 is spent on card in first 3 months.
Representative example: When you spend £1,200 at a purchase rate of 26.4% (variable) p.a., your representative rate is 29.9% APR (variable).
CASHBACK
Barclaycard Select Cashback Business Credit Card Mastercard
21.9%
£0
1% cashback
21.9% APR (variable)
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Get 1% cashback uncapped on all your business spend and an additional 2% cashback on all spend with BT and EE. T&C's apply.
Representative example: When you spend £1,200 at a purchase rate of 21.9% (variable) p.a., your representative rate is 21.9% APR (variable).
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Benefits of business expense cards

There are a number of benefits when it comes to using a business expense card. These include the following:

  • Increased efficiency. Rather than worrying about employee expense claims or petty cash, a business credit card can be issued to a number of different employees, and all accounts can be viewed on a single online dashboard. This means you’ll have a clear idea of what is being spent where.
  • Multiple users. You can issue expense cards as and when required, and companies can usually set different spending limits for different employees depending on their role.
  • Connect to accounting software. You may be able to connect your business credit card to track all purchases in your accounting software, including capturing images of business receipts.
  • Separate personal and business expenses. Keeping personal and business accounts separate makes it easier to track expenses and stay on top of your finances. It will also help your business to build a credit score, which can be useful if you need to apply for credit again in the future.
  • Rewards and cashback. Some business cards come with rewards and cashback features, enabling you to earn something back as you spend.

Drawbacks of business expense cards

As with any financial product, there are also several drawbacks to be aware of. For a start, some business expense cards can be costly. You may be charged an annual fee, and if you don’t clear the balance in full each month, interest charges can be high. Further fees could be charged if you don’t make your payments on time or if you exceed your credit limit.

What’s more, a credit check will need to be carried out before you can qualify for a business credit card. If your credit score is poor, you may be turned away.

Prepaid business cards

As well as using a business credit card, you can also choose from prepaid business expense cards. Prepaid business cards are paid for by the employer and can be topped up whenever needed. This also means that the employee can only ever spend what’s on the card, making them a good option for budgeting.

Further benefits of prepaid business cards include that they can often be integrated with accounting software and no credit checks need to be carried out on either the employer or the employee.

The downside is that there may be monthly fees or fees for certain transactions such as making purchases or cash withdrawals. In most cases, they won’t help you to build up a business credit score either.

Business expense card providers in the UK

Some of the business expense card providers in the UK include:

Alternative options

If you don’t want to use a business credit card or a prepaid card for your business expenses, you could consider a business charge card instead. Charge cards offer short-term interest-free funding, and while they work in a similar way to a credit card, they tend to offer higher spending limits. You must also repay the balance in full each month – there is no option to carry it over into the following month. Charge cards can be given to employees to pay for work expenses, and again, different spending limits can often be applied to different employees.

The other main option for companies is to ask employees to pay for expenses themselves, which the company will then reimburse. However, this involves a lot of administration, including the collection of receipts and claim forms, and can be extremely time-consuming.

Frequently asked questions

We show offers we can track - that's not every product on the market...yet. Unless we've said otherwise, products are in no particular order. The terms "best", "top", "cheap" (and variations of these) aren't ratings, though we always explain what's great about a product when we highlight it. This is subject to our terms of use. When you make major financial decisions, consider getting independent financial advice. Always consider your own circumstances when you compare products so you get what's right for you.

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