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Newest Entrants to the Business Card Space
Business credit cards or business charge cards are one of the most effective tools that small business owners use to manage business purchases. These are often rewards cards that come with rewards rates for cardholders, which give an amount back on everyday spending. Whether it’s flat-rate rewards or rewards on specific spending categories, business owners are often looking for a great business credit card.
There are several card issuers and companies that have released new business cards since 2022. However, the small business card space is a difficult one to stay afloat in, and many have tried and failed. For example, Fundid released a card and then a few months later, the card was off the market. Additionally, Brex took on small business customers but then decided to drop that customer base in 2022. But for small business owners, the business cards on the market are incredibly useful.
Here are the most recent additions to the business card space:
BMO
BMO currently offers two business credit card options, one with a rewards program and one with a low interest rate. If you use the rewards card, you can get more back using the BMO Harris Rewards program.
Corpay One Mastercard®
Cardholders can use the Corpay business card to pay their bills and help with cash flow constraints. They will also earn a percentage back in rebates for using the card and can access a larger line of credit.
Nav Prime Card
Nav Prime Card
Lowest minimum requirements on the market. Available with Nav Prime.
Pros
- The Nav Prime Card is the only business credit-building charge card with no credit check, no personal guarantee, and no security deposit
- Nav will report your everyday purchases as a tradeline
- Access the Nav Prime Card as part of Nav Prime — the only solution that lets you track your credit progress while simultaneously building your business credit.
Cons
- The Nav Prime Card does not offer a traditional 30-day repayment window like many other charge cards
- The nav Prime Card has an automatic 24 hour repayment window.
Intro APR
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Welcome Offer
Shopify Credit
Shopify is a popular ecommerce solution for small business owners. It released a cash back rewards card aimed at businesses earlier this year called Shopify Credit. The card claims to have no fees, no interest, and no credit checks while also offering rewards.
Most Popular Business Credit Cards Currently
When you’re searching for a business credit card, you’ll want to look for features like:
- Introductory APR for a number of billing cycles after account opening
- Welcome bonus or sign-up bonus
- Additional rewards after first year
- Low or no annual fees, foreign transaction fees, or balance transfer fees
- Sufficient spending limits
- Free employee cards
Here are some of the business credit cards most utilized by small business owners today:
The American Express Blue Business Cash™ Card
This American Express card offers cash back rather than Membership Rewards points: Earn 2% cash back on all eligible purchases on up to $50,000 per calendar year, then 1%. It also charges a $0 annual fee.
One of the highest cash back rates available for small business cards.
Pros
- Attractive intro financing offer
- High rates of cash back for business spending
- No annual fee.
Cons
- No rewards bonus for initial spending
- Foreign transaction fees.
Intro APR
Purchase APR
Annual Fee
Welcome Offer
Ink Business Unlimited® Credit Card
Not only is there a $0 annual fee for this card. This Chase Ink Business card also gives you great rewards potential: Earn unlimited 1.5% cash back on every purchase made for your business. Use Chase Ultimate Rewards to maximize your perks.
What is the new credit card law in 2023?
The Credit Card Competition Act of 2023 is a proposed U.S. federal law that seeks to limit the power of banks using the Visa and Mastercard networks for their credit cards. Visa and Mastercard control more than 80% of the U.S. credit card network market, as the one-page summary of the act said. Also, their fees are taking 2% to 3% away from business owners with every customer’s swipe. “In 2022 alone, Visa, Mastercard, and their card-issuing banks charged merchants a total of $93 billion in credit card fees,” said the summary.
Currently, if a credit card uses the Mastercard network, it’s only processed using Mastercard (and the same is true with Visa). If the law passes, banks issuing credit cards would need to give merchants the choice of two networks, only one of which can be Visa or Mastercard. The other would be required to be a separate network, which would increase competition and help small business owners save on fees.
Can I get a business credit card with a brand new LLC?
Yes, it’s possible to get a business credit card to cover business spending for a startup limited liability company (LLC). However, it may not be as easy to get great rates and terms, which can depend on several factors, like your personal credit history, the financial health of your LLC, and the policies of the credit card issuer.
Here are a few things to consider:
- Personal credit history: Many credit card issuers will evaluate your personal credit history when deciding whether to approve a business credit card for your LLC, especially if the LLC is new and lacks its own credit history. A strong personal credit score can improve your chances of getting approved and might lead to better terms and higher credit limits.
- LLC’s financials: While some credit card issuers might offer credit cards to brand new LLCs, others might require your LLC to have been in operation for a certain period of time and to show a minimum level of income or revenue. The financial health of your LLC could influence the credit limit you’re offered.
- Business structure and documentation: You may need to provide documentation proving the existence of your LLC, such as your articles of organization, your employer identification number (EIN), and potentially other business-related documents.
- Personal guarantee: As the owner of a new LLC, you most likely will need to provide a personal guarantee for the credit card, which means you would be personally liable for any debts incurred by the business using the credit card. This is common, especially for newer businesses without an established credit history.
- Choice of credit card issuer: Some credit card issuers are more lenient than others when it comes to offering credit cards to new LLCs. Research and compare different credit card options from various issuers to find one that aligns with your business’s needs and your personal financial situation. You may not be able to qualify for cards with bonus rewards for business categories, however.
- Build business credit: Over time, as your LLC establishes a positive credit history, it might become easier to secure credit cards and other financing options solely based on the business’s creditworthiness.
It’s a good idea to research different credit card options for your LLC, and using Nav is the easiest way to compare the options you can qualify for before you apply. Remember that responsible credit card usage can help your new LLC build a strong credit profile, which will be valuable for future financing needs.
Sole proprietors and freelancers can also apply to get business credit cards.
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What’s the starting credit score for a new business?
Unlike personal credit scores, there is no universal first credit score for a new business. Business credit scores are calculated differently from personal credit scores and can vary depending on the credit bureau and scoring model used.
Business credit scores typically range from 0 to 100 or 0 to 300, depending on the bureau. A higher score indicates lower credit risk. However, the specific range and factors considered can differ among bureaus. Here’s a general overview:
- Dun & Bradstreet PAYDEX Score: The PAYDEX score from Dun & Bradstreet ranges from 0 to 100. A score of 80 is often considered a good starting point, indicating that your business pays its bills on time.
- Experian Intelliscore Plus: Experian’s Intelliscore Plus ranges from 1 to 100, with a higher score indicating lower credit risk. A score of around 80 is generally considered average for a new business.
- Equifax Business Credit Risk Score: Equifax’s business credit risk score ranges from 101 to 992. Each range represents a different level of credit risk. A score in the 300s or 400s might be considered average for a new business.
Each bureau might have its own scoring model, incorporating various factors such as payment history, credit utilization, business size, industry risk, and more.
Since there is no fixed starting credit score, the best approach is to focus on building a positive credit history for your business by paying bills on time, managing credit responsibly, and gradually establishing relationships with lenders and suppliers who report to business credit bureaus. Over time, as your business establishes a track record of responsible credit behavior, its credit score can improve.
How to build business credit in 2024
Your personal credit history can impact things like interest rates and credit limits. But your business credit can also play into the type of card you’re offered. A small business credit card offers a chance to build business credit, depending on whether the card reports to one or more of the three business credit bureaus.
Building business credit in 2023 follows similar principles to previous years, with a focus on establishing a strong financial track record for your business. Here’s a step-by-step guide on how to build business credit:
- Incorporate your business: If you haven’t already, establish your business as a legal entity, such as an LLC or a corporation. This separation between your personal and business finances is crucial for building business credit.
- Get an EIN: An EIN, also known as a federal tax identification number, is necessary for your business’s tax reporting and credit applications.
- Open a business bank account: Keep your business finances separate from your personal finances. A dedicated business bank account is essential for managing your business’s income and expenses.
- Establish tradelines: Work with suppliers, vendors, and service providers that report payment history to business credit bureaus. This can help your business establish a positive credit history. Nav Prime gives you two business tradelines with your everyday spending.
- Apply for a business credit card: Research and apply for a business credit card using Nav. Look for one that reports to business credit bureaus. Use it responsibly and make timely payments to demonstrate your business’s creditworthiness.
- Pay bills on time: Consistently pay your business bills, loans, and credit card balances on time. Late payments can negatively impact your business credit score.
- Monitor your business credit report: Regularly check your business credit report with major credit reporting agencies. Ensure that the information is accurate and up to date with detailed credit reports using Nav Prime.
- Establish a D&B profile: Create a profile with Dun & Bradstreet (D&B) to start building a credit history with them. D&B is a major business credit bureau that many lenders and suppliers use to assess business creditworthiness.
- Secure a small business loan: Apply for small business loans or lines of credit. Even if you don’t need a loan immediately, having a credit line and repaying it responsibly can boost your business credit profile. (And you can also find the best loan for your business with Nav).
- Maintain a low credit utilization: Keep your credit card balances and credit utilization low. This shows that your business can manage credit responsibly.
- Gradually increase credit limits: As your business credit improves, request credit limit increases on your existing credit accounts. This can provide your business with more financial flexibility.
- Stay consistent: Building business credit takes time. Be patient and consistent in your efforts to establish a positive credit history.
Learn more about how to establish business credit in this Nav guide. Remember that building business credit is about demonstrating responsible financial behavior over time. Just like personal credit, it’s important to be cautious and strategic in your credit-building efforts. If you’re uncertain about the process, consider consulting with a financial advisor who specializes in business credit.
What is the best business credit card for restaurants?
When selecting the best business credit card for your restaurant, consider factors like:
- Rewards: Cash back rewards or bonus points on eligible purchases can give you something back for what you’re already spending. Bonus categories can include things like office supply stores, gas stations, cell phone bills, or other phone services like upgrades.
- Travel rewards: Make business travel easier with travel rewards like access to airport lounges or car rental upgrades. You may be surprised how much of a difference something small like easy lounge access can make to your travel experience.
- Welcome bonus: You can get additional rewards after spending enough to qualify within the first several months of opening the card.
- Fees: Find annual fees, foreign transaction fees, balance transfer fees, and more that are worth it in relation to the rewards offered.
- Bonus after first calendar year: Some cards may offer bonus points or a statement credit on your first account anniversary year
- Additional benefits: Think expense management tools, travel insurance, or purchase protection, and how well the card aligns with your spending habits.
It’s a good idea to review the terms and benefits of each card carefully to determine which one best suits your restaurant’s needs. The best business credit card for restaurants can vary based on your specific needs and preferences.
Here are some options that are often considered beneficial for restaurants due to their rewards, features, and benefits:
American Express® Business Gold Card
High annual fee, best for large purchases in consistent categories.
Pros
- This card has a great rewards program and offers flexibility compared to true charge cards.
Cons
- High annual fee
- Only 1x rewards outside of your top categories.
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Welcome Offer
Bank of America® Business Advantage Unlimited Cash Rewards Mastercard® credit card
Intro APR
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Welcome Offer
What’s the Minimum Credit Score to Get a Business Credit Card in 2023?
Personal finances impact your ability to get a business credit card. Since you’ll likely need to enter your Social Security number into a credit card application, that means your personal credit score will determine a lot of your eligibility. Most business credit cards require good to excellent credit scores. However, there are a few that might accept applicants with low credit scores or those who are new to credit, but you may be given a higher interest rate (also called a variable APR).
Can I Get a Credit Card With a Bad Credit Score?
There are credit card providers that offer personal credit cards, charge cards, and corporate cards that may be more willing than business card providers to accept applicants with low credit scores — or they may not look at credit at all during the application. Some of these cards may still offer rewards programs on qualifying purchases, but you may need a large annual revenue to qualify.
Get your detailed credit reports from Nav Prime to monitor your personal and business scores in one place.
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*Nav Technologies, Inc. is a financial technology company and not a bank. Banking services provided by Thread Bank, Member FDIC. The Nav Visa® Business Debit Card and the Nav Prime Charge Card are issued by Thread Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa cards are accepted. See Cardholder Terms for additional details. FDIC insurance is available for funds on deposit through Thread Bank, Member FDIC. All other features of the Nav Prime membership are not associated with Thread Bank.
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Tiffany Verbeck
Digital Marketing Copywriter, Nav
Tiffany Verbeck is a Digital Marketing Copywriter for Nav. She uses the skills she learned from her master’s degree in writing to provide guidance to small businesses trying to navigate the ins-and-outs of financing. Previously, she ran a writing business for three years, and her work has appeared on sites like Business Insider, VaroWorth, and Mission Lane.