Can You Qualify for a Business Credit Card?

Can You Qualify for a Business Credit Card?

Can You Qualify for a Business Credit Card?

A business credit card can be a convenient method of payment, a method of finance and even a way to earn valuable rewards and benefits. But many small business owners wonder if they will be able to qualify for a small business credit card. Actually, it may be easier than you think.

Nearly any kind of business can qualify for a small business credit card. This includes corporations, partnerships, non-profit companies and limited liability companies. You can also apply as a sole proprietor. Furthermore, your business doesn’t have to be established before you apply for a small business credit card. You can apply for a card as soon as you start your business, as your application will typically be evaluated using your personal credit history and a consumer credit score, not that of your business.

How to Apply for a Small Business Credit Card

An application for a small business credit card will be similar to a personal credit card, except that it will ask you for information about your company. For example, you will need to supply your business name and the name you will want to appear on the card. You’ll also need to provide your business address and phone number. 

Other business information required will include your business’s legal structure, its ownership type and its tax ID number. The IRS provides your business with a 9-digit TIN or Employer Identification Number (EIN). But if you are a sole proprietorship, then your tax ID will be your Social Security Number. Also, the application will ask you for some basic information about your business, such as its age, industry type. It will also ask you for financial information such as your annual business revenue and spending.

This is all in addition to the personal information that you would provide for any credit card application including your home address, birth date and social security number. You’ll also be asked to supply your total annual household income and your rent or mortgage payment. When it comes to your income, you can include nearly all sources including alimony, child support, investment income and government benefits. But at the same time, you don’t have to include anything you don’t want to.

You can also include income from other household members, so long as you have a reasonable expectation of access to these funds to repay your loan. For example, a non-working spouse could include the income of a working spouse if he or she can use that income to make credit card payments.

Best Business Cards For New Businesses

Most business credit cards are available to brand-new businesses. Here are some favorites for new businesses: 

Capital One Spark Cash Select - $500 Cash Bonus

New businesses can always use extra cash. With this card, you can earn $500 Cash Back once you spend $4,500 on purchases within the first 3 months from account opening. Cardholders also earn 1.5% Cash Back on every purchase and 5% Cash Back on hotels and rental cars booked through Capital One Travel. And the annual fee is $0

American Express Blue Business Cash™ Card

This card has numerous benefits including and introductory APR of 0% on purchases for 12 months from date of account opening which can be very helpful for new business. Earn a $250 statement credit after you make $3,000 in purchases on your Card in your first 3 months.. Ongoing rewards are strong as well. Earn 2% cash back on all eligible purchases on up to $50,000 per calendar year, then 1%. Plus, the annual fee is $0.

Amazon Business American Express Card

Businesses that shop on Amazon may find this card useful because it offers the choice of cash back or longer repayment terms for certain purchases. Take advantage of 3% Back or 60 Day Terms on U.S. purchases at Amazon.com, Amazon Business, AWS and Whole Foods Market. You will earn 3% Back on the first $120,000 in purchases each calendar year, 1% Back thereafter. 2% Back at U.S. restaurants, U.S. gas stations, and on wireless telephone services purchased directly from U.S. service providers. 1% Back on other purchases.

And you can get an automatic welcome bonus: Get a $100 Amazon Gift Card upon approval for the Amazon Business American Express Card.

Ink Business Unlimited® Credit Card

There are several Chase Ink®  Business Cards that are popular with small businesses. This one a generous 0% Intro APR on Purchases for 12 months which can help with business cash flow. And cash back rewards can be beneficial for cash flow. Earn unlimited 1.5% cash back on every purchase made for your business. Plus the annual fee is $0.

Best Business Credit Cards With No Annual Fee

If you don’t want to pay an annual fee, you have some excellent choices when it comes to small business credit cards. 

We’ve already listed several great cards with no annual fees in the list of best cards for new businesses. (No annual fee cards can be great for established businesses as well!) An additional option to consider: 

Bank of America® Business Advantage Customized Cash Rewards Mastercard® credit card

Not only does this card offer $0.00 annual fee, it has a generous welcome offer $300 statement credit online bonus after you make at least $3,000 in net purchases in the first 90 days of your account opening.

Plus you can earn 3% cash back in the category of your choice (for the first $50,000 in combined choice category/dining purchases each calendar year, 1% thereafter), 2% cash back on dining purchases (for the first $50,000 in combined choice category/dining purchases each calendar year, 1% thereafter), and 1% cash back on all other purchases.

Best Business Credit Cards With Perks

There are many business credit cards with rewards programs, so to narrow down the best rewards card for your business you’ll need to think about what perks you want (cash back or travel rewards), whether you’re loyal to a particular travel brand such as an airline or hotel group, and how much you plan to charge in business expenses.

Here are three great business rewards credit card offers to consider: 

The Business Platinum Card® from American Express 

This is a premium credit card and the annual fee of $695 reflects that. It offer premium benefits that many business owners find worth it.

Welcome Offer: Earn 120,000 Membership Rewards® points after you spend $15,000 on eligible purchases with your Card within the first 3 months of Card Membership. Get 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com, and 1X points for each dollar you spend on eligible purchases.

Capital One Spark Miles for Business

This card offers 50,000 Miles once you spend $4,500 on purchases within 3 months from account opening. For ongoing rewards, you’ll earn 2 Miles per $1 on every purchase, everywhere. 

Ink Business Cash® Credit Card

With this card you can get a cash back welcome offer, ongoing cash back and 0% Intro APR on Purchases for 12 months

LIMITED TIME OFFER: Earn $900 bonus cash back after you spend $6,000 on purchases in the first 3 months from account opening. Earn 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on internet, cable and phone services each account anniversary year. Earn 2% cash back on the first $25,000 spent in combined purchases at gas stations and restaurants each account anniversary year. Earn 1% cash back on all other card purchases with no limit to the amount you can earn.

Best Business Credit Cards For No Personal Guarantee

The large majority of small business credit cards require a personal guarantee. That’s true even if they do not appear on your personal credit reports. 

Typically to qualify for a card with no personal guarantee you’ll need a business with a formal business entity (LLC or Corporation), and you’ll need to demonstrate significant revenues for the business. That may mean as much as $5 to $10 million in annual revenues before personal guarantees will be waived. 

If your business doesn’t meet those requirements yet, you may be encouraged to know that many small business credit cards don’t report to personal credit unless you default. As long as you pay these cards on time you won’t see the balances appear on your personal credit. 

In addition, most small business credit cards report to business credit bureaus which can help you build good business credit scores if you pay on time. 

How Long Do You Have To Be In Business To Get A Business Credit Card?

Most major small business credit cards are available to startups. You just need to meet the issuer’s qualifications for personal credit scores and income from all sources. Unlike traditional small business loans, most cards don’t require you to have a certain number of years in business to qualify. 

Do You Need An LLC To Get A Business Credit Card?

You do not need an LLC to qualify for many small business credit cards. There are some corporate cards that won’t allow you to apply as a sole proprietor, but many card issuers allow all entrepreneurs to apply.

If you have formed a business entity it’s essential you separate your business and personal finances, including by using a dedicated business credit card. Commingling your finances can jeopardize the asset protection benefits of your business entity.

Can You Get A Business Credit Card With No Revenue?

You may be able to qualify for many small business credit cards even if your business isn’t making money yet. Issuers will generally allow you to include income from all sources, not just the business. If you have other income, including household income, you may be able to qualify based on that total income. 

What Credit Score Do You Need To Get A Company Credit Card?

While there are personal credit cards that are designed for those with any credit profile, even if you have fair or poor credit, most small business credit cards require good or excellent credit (though there are some business credit cards for bad credit). 

Good credit is often defined as a FICO credit score of between 671 and 739, while excellent credit is 740 or above. There are some cards available for credit scores of 650 or higher, but if your FICO credit score is 650 or below, then you’ll have a hard time qualifying for a small business credit card until your credit improves. 

Just like with personal cards, your personal credit score will often impact whether you are approved, the interest rate you’ll pay, and your credit limit. 

What Can You Do If Your Application Is Rejected?

Most of the time, credit card issuers are able to offer you instant acceptance when you apply for a small business card online. But even if you don’t immediately receive approval, you have two options. 

First, you can call the card issuer by telephone, and ask for a decision. Or you could wait and you might still be notified by mail within the next two weeks.

But even if your application is declined, you can still contact the card issuer and ask to have it reconsidered. During a reconsideration telephone call, the representative will go over your application and see if there’s any changes that you can make to improve your chances. For example, if you failed to list all of your sources of household income, or if you accidentally listed your business profits rather than its revenue.

And if you already hold business credit cards from the same issuer, you could consider closing another account or moving part of your line of credit in order to get approved.

Bottom Line

By understanding how small business credit card applications work, you’ll realize that most small businesses such as yours can qualify for a new business credit card and enjoy the benefits they offer. Don’t be afraid to apply for a business credit card if your business is brand new. You may be able to find a card that’s perfect for your business, at any stage.

This article was originally written on March 19, 2018 and updated on October 1, 2022.

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