There are key steps you don’t want to overlook when starting a new business, and one is setting up your business financial systems to track business expenses, monitor cash flow and complete your taxes on time.
Business credit cards can be a great tool to manage business spending. Not only are credit cards the safest way to pay for purchases, they often offer excellent rewards and higher credit limits. They are also easier to get than small business loans for startups.
Here’s the good news. Many of the most business credit cards are available as soon as you start your business. That’s true even if you just start as a freelancer or independent contractor.
Why wait? Here’s how to get a first time business credit card.
11 Best First Time Credit Cards For New Businesses
Here are eleven of the best business credit cards for small business owners starting a new business.
With this card you can get. It also has a solid welcome offer: Plus it offers ongoing rewards of
A low introductory rate can be helpful for cash flow, and this card offers. For an ongoing basis, you’ll earn . Plus, the annual fee is .
If your business plans to shop on Amazon thecarries an annual fee of and there’s a welcome bonus. .
Costco Business shoppers will want to consider the. It’s especially valuable for fuel purchases. Costco is already known for its lower cost gas station prices. With this card, get .
Withthis card can be helpful for financing start-up business expenses. And it offers a solid rewards program.
If your credit is fair to good, or you are new to credit, this card may be a good fit. The annual fee is. And the foreign transaction fee is .
This card offers a trifecta of solid benefits. Get a
And then earn ongoing rewards on all eligible purchases.
If you know you’ll have a chunk of startup expenses in your first three months, the Chasehas a very good welcome offer. .
The annual fee is justwhich can easily be offset by the sign up offer and ongoing points.
Thecombines a business credit card with a robust expense management platform. It can be especially useful if you plan to issue employee cards, as it offers free employee cards with excellent spend management tools. And it offers rewards: .
Another option for new small business owners, this card features a rewards rate of.
11. U.S. Bank Triple Cash Rewards Visa® Business Card
Earn $500 in cash back if you spend $4,500 on the account owner’s card in the first 150 days after account opening. Earn 3% cash back on eligible purchases at gas and EV charging stations, office supply stores, cell phone service providers, and restaurants. And you can earn an annual $100 statement credit for monthly software service purchases such as FreshBooks or QuickBooks.
*All information about the U.S. Bank Triple Cash Rewards Visa® Business Card has been collected independently by Nav. This card is not currently available through Nav. To see what business credit cards are available, please visit the Nav Credit Card Marketplace.
Features To Consider When Getting A New Business Credit Card
When it comes to choosing the best business credit card for your new business, you’ll want to consider both costs and perks:
Annual fees on business credit cards range from nothing to hundreds of dollars. Higher annual fees are associated with premium cards with more benefits. Some cards waive the annual fee the first year, which an be helpful when you’re just starting out.
But higher fees can be well worth it, especially for businesses that charge a lot on their cards and earn significant rewards. A new startup business with relatively low expenses may want to start with a card with no annual fee, or a lower annual fee.
Most credit cards allow you to borrow money and repay that debt by making monthly payments. (Charge cards require payment in full each billing cycle.) Credit card interest rates typically run in the low double digits (in the range of a 14—22% variable Annual Percentage Rate depending on borrower qualifications). But cards with low intro APRs— including 0% introductory APRs— allow businesses the opportunity to finance purchases inexpensively for nine to twelve months or more.
Cash Back Rewards
Cash back is a popular credit card reward, as it’s easy for businesses to put cash back to good use. Some cards offer cash rewards as a specific percentage of eligible purchases; for example 1.5% cash back on all purchases. Others offer tiered cash back, with higher cash rewards purchases in certain spending categories like office supply stores or restaurants, for example.
Travel rewards on business credit cards can be lucrative, and may include rewards points that can be redeemed for travel, as well as travel benefits like car rental insurance, status on airlines or hotels, access to airport lounges, free checked luggage on flights and more.
Sign up Bonus
Many small business credit card offers feature sign up bonuses or welcome offers that allow the cardholder to earn bonus cash back or bonus points by spending a certain amount within a specific time period. (For example, earn $400 bonus cash back when you spend $3000 within the first three months after account opening.)
Travel perks aren’t the only ones cards offer. Purchase protection, extended warranties, higher spending limits and free employee cards are just some of the other benefits offered by many business credit card issuers.
No Personal Guarantee
With a personal guarantee, the cardholder can be personally liable for the debt if the business can’t repay it. Most small business credit cards do require a personal guarantee (PG). A few small business credit cards and most corporate cards do not require a PG, but those cards are not typically available to new businesses as the business will need strong revenues to qualify.
Qualifying For Beginner Business Credit Cards
Here’s the good news. If you have good personal credit and sufficient income (not just from the business), you may qualify for many of the most popular small business credit card. That’s because many of these card issuers base approval on the applicant’s personal credit score, and income from all sources, which can even include household income that’s available to pay the debt.
Personal creditworthiness is a factor here; most cards require good to excellent personal credit scores.
How To Apply For A First Time Business Credit Card
The application process for a business credit card for a new business is similar to that of applying for a personal credit card. You’ll include personal information (name, social security number, address, phone number etc.). When you apply for a business credit card you’ll also be asked for information about the business, including the name of the business, Employer Identification Number (EIN) if available, business revenues or projected revenues.
Most business credit card issuers don’t check business credit, but they do report to business credit bureaus. That means using one of these cards responsibly can help you establish business credit.
How To Get A Business Credit Card As A New Sole Proprietor
If you operate your business as a sole proprietorship, freelancer, or independent contractor, you can apply for many of the most popular business credit cards. While a few credit cards are only available to businesses that are formed as an LLC or corporation, most are available to business owners who haven’t yet taken that step. With those cards, if you apply and don’t have an Employer Identification Number (EIN) you can list your social security number.
How To Get A Business Credit Card After Setting Up A New LLC
If you plan to form an LLC or a corporation (C corporation or S Corporation), you may want to wait until you have formed your business entity and received your EIN. When you start to build business credit in the name of your LLC or corporation, this will be helpful.
How To Get A First Time Business Credit Card For A Startup
You may be able to get a business credit card the day you start your business—even if it hasn’t made any money yet. Again, most credit card issuers will consider personal credit and income from all sources when evaluating credit card applications for business credit cards.
Why A Business Credit Card May Not Be The Best Fit As A First Time Credit Card At This Time
If you qualify for a business credit card with good terms, it is often preferable to using a personal credit card for business purchases. However, if you are starting a business as a sole proprietorship or independent contractor and you plan to form a business entity, such as an LLC or corporation soon, you may want to wait until you form your business to get a business credit card.
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