I’ve Been Denied for a Business Credit Card. What Now?

I’ve Been Denied for a Business Credit Card. What Now?

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Nobody likes the feeling of rejection. It stings when you get turned down socially, and it hurts when you aren’t given a job. And as a small business owner, it can be very frustrating to be denied for small business credit card.

If this has happened to you, don’t worry about it too much. There are still some steps you can take to be approved for the card that you applied for, and some alternative credit cards you can apply for that will increase your chances of acceptance.

Step one: Call for reconsideration

It’s important to realize that the initial decision made by a credit card issuer is not final. It’s likely that the card issuer’s computer made the decision, but thankfully you can appeal it to a human. To do so, simply call the card issuers reconsideration team, which can manually review your application.

When you speak to a representative, you can ask why your application was declined, and make your case for approval. For example, you might be able to clarify your household income to include eligible sources such as child support, alimony, government benefits, and investment income. You can also include any household income that you have access to, including your spouse’s. Finally, you can volunteer to shift part of your line of credit from another card issued by the same company. This allows you to receive the rewards benefits of the new card, while limiting the card issuer’s exposure to default.

Look for ways to improve your credit score

Even though a small business credit card has your company’s name on it, you will still be relying on your personal credit history and credit score when you apply. Thankfully, there are several things that you can do to improve your score.

One of the largest factors in your credit score is the amount you owe. However, your credit report will show your debt according to your most recent credit card statement balances, even when you avoid interest charges by paying your balance in full. But if you pay your balance off before your statement period closes, then no debt will be listed on your credit report, helping your credit score. Other ways to help your credit score include making sure that you pay all of your bills on-time, and not applying for too many new lines of credit in a short period of time.

Once you obtain your business credit card, it can help you build your business credit scores so that your business starts to become a credible borrower separate from you as an individual. Just make sure you make on time payments on the card so your business credit scores move in the right direction.

Consider a small business credit card made for those with less than perfect credit

If you need a small business credit card now, and you can’t qualify for most credit cards, then consider one made for those with “fair” or “average” credit. For example, the Capital One Spark Classic is a small business card that features unlimited 1% cash back rewards on all purchases. It has a $0 annual fee.

Capital One® Spark® Classic for Business

Enjoy no annual fee. Earn 1% cash back on every purchase, every day. Build business credit Learn More
View More Offers

Also, the Visa Business Rewards from BBVA Compass offers cardholders one Compass Point for every dollar spent. It features double and triple Compass Points when you make purchases in the categories you select, such as office supplies, utilities, groceries, gas, travel, and healthcare, and there’s no annual fee for this card.

Finally, there are even secured cards for small business owners. Secured cards work almost exactly like unsecured cards, except that they require the payment of a refundable security deposit before you can open an account. But afterwards, they work just like any other credit card. You will receive a monthly statement, and must make a payment each month. But most importantly, secured cards are typically available to applicants with any credit profile.

Wells Fargo offers a secured card with a $25 annual fee. BBVA’s Compass bank’s secured card has a $40 annual fee that’s waived the first year. And First National Bank offers a secured card with an annual fee of $39 and limits of up to $110,000.

Bottom line

Being denied a small business card doesn’t have to be the end of the story, it can actually be the beginning. By considering all of the options available, you can be sure to find a credit card that works for your business.

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About the Author —

Jason Steele is an expert in the credit card industry. He is frequently quoted in national media and his work is regularly featured by mainstream outlets such as Yahoo! Finance, MSN Money, and Business Insider.

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  • J850

    Capital One- (in particular Capital One Spark) is a “Nogo” in my personal opinion for small business:

    • They put a hard inquiry on ALL THREE credit bureaus.

    • Your usage is reported to your personal credit. So you are limited to 30% or less of your credit line if you want to have a decent credit score.

    • No credit increase after 5 on time payments like their personal card.

    • You are pretty much at the “mercy” of Capital One and their borderline discriminating policies if you are starting or building your business credit.

    I DONT recommend them based on my personal experience with them.

    If anyone had a better experience, please comment below or reply.