Best Business Cards for Bad Credit

Best Business Cards for Bad Credit

Best Business Cards for Bad Credit

Business credit cards offer small business owners access to a flexible line of credit along with a convenient and safe way to pay for business expenses. Many offer cash back rewards, sign-up bonuses, and other perks. If your credit scores aren’t high you may find it more difficult to qualify — but there may still be options available to you. In this article, we’ll discuss how to find and qualify for small business credit cards for bad credit.

Do Business Credit Cards Check Personal Credit Score?

Yes. Even though you use business credit cards for business purposes, financial institutions look at your personal credit score to determine if you qualify. The process often requires what’s called a hard credit check, which shows up on your personal credit report and may lower your credit score by a few points. 

However, you can also establish business credit scores. This score represents your business as a separate entity and its ability to repay what it owes. We discuss how to establish business credit later in this article.

Some business credit cards also report the activity on your business credit card to consumer credit bureaus. Thus, signing up for a business credit card to take advantage of the great rewards program or balance transfer rates may end up impacting your personal credit score. It’s helpful to keep this in mind when shopping around for a business credit card.

If your personal credit score isn’t quite where it needs to be to get a top-of-the-line business credit card, you still have options.

What Is Considered Bad Credit?

A bad credit score depends on which scoring system you’re using, usually FICO Score or VantageScore. Credit card providers use one of the available scores to determine if you’re eligible, and you can ask which score the lender uses before applying. 

A FICO credit score of 669 or lower is considered “fair” or bad and can make it more of a challenge to qualify for a credit card. A VantageScore of 600 or lower is considered “fair” or bad credit. It’s usually easier to qualify for a credit card when you have scores in the “good” or “excellent” range. We explore your top choices for the best business credit cards for bad credit below.

The Best Business Credit Cards for Bad Credit

There may be credit card options available to you even if you have poor credit. Here are credit cards to consider if your credit scores aren’t strong.

Best Credit Cards for Limited Credit

Capital One Spark Classic for Business

The Capital One Spark Classic for Business is a popular card for those with less than perfect credit.

The Capital One Spark Classic for Business may be a good fit for businesses that want to build credit.

Divvy Smart Credit Card for Business

The Divvy Smart Credit Card for Business is a great option if you have limited credit history.

The Divvy Smart Credit Card for Business could work well if you want to avoid paying interest on your credit card and don’t travel much for business. You’ll pay more to use the card overseas because of the foreign transaction fee.

Secured Business Credit Cards

A secured business credit card is another option for business owners with bad credit. These are much easier to qualify for than unsecured credit cards. A secured card requires a cash deposit to be held as a security deposit. (Typically you’ll get it back when you close the account.) This is a way for credit card companies to minimize the risk of a high risk borrower. Secured cards usually allow borrowers to charge up to the amount of their security deposit, though some will let your balance exceed your credit limit if you manage it responsibly.

Best low-cost secured cards

Self: The responsible way to build credit

The Self: The responsible way to build credit card is one of the few secured credit cards that targets businesses on the market at the time of writing and could be a great option for your business.

The Self: The responsible way to build credit credit card could be great for a business owner looking for a secured card and looking to build up their credit. The card reports to credit bureaus, so making on-time payments on the card may boost your credit score.

Bank of America Business Advantage Unlimited Cash Rewards Secured credit card

The Bank of America Business Advantage Unlimited Cash Rewards Secured credit card is a no-cost business secured credit card built to help establish and grow business credit.

The Bank of America Business Advantage Secured credit card allows cardholders to secure a credit line of at least $1,000. With this card, the amount of your credit line is equal to the amount you deposit. There is no annual fee. 

*All information about the Bank of America Business Advantage Unlimited Cash Rewards Secured credit 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 Nav.

Best personal secured cards

Citi® Secured Mastercard®

While the focus here is on business credit cards, a personal credit card may help you build credit if used properly.

The Citi® Secured Mastercard® is a $0 annual fee credit card that can help with building credit when used responsibly. A security deposit (minimum of $200) is required. Once approved, your credit limit will be equal to your security deposit. With Citi’s Flexible Payment Due Dates, you can choose any available due date in the beginning, middle or end of the month, then manage your account 24/7 online, by phone, or in the mobile app.

Discover it® Secured Credit Card

The Discover it® Secured Credit Card is a personal card that also offers rewards and could work well for a business owner looking to earn on everyday spending and build credit.

The Discover it® Secured Credit Card doesn’t charge an annual fee and has a robust rewards program and an intro bonus: You can get a 2x cash back match at the end of your first year. 

The rewards program offers:

  • 2% cash back on restaurants and gas stations on up to $1,000 per quarter
  • 1% cash back on every other purchase

Pay as little as $200 on the deposit to open this secured card.

*All information about the Discover it® Secured Credit 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 Nav.

How Do I Establish Business Credit?

Although you likely don’t need an established business credit score to get a small business credit card, having business credit can help your business succeed in many ways. For example, a good business credit score can open business funding opportunities that you couldn’t have accessed without it. It may also allow you to get more agreeable payment terms with your suppliers and vendors, which can make payments less of a hassle for your business. Additionally, if your goal is to work with a Fortune 500 company or a government agency, these institutions will check your business credit to make sure you’re a legitimate business before signing on the dotted line.

The easiest way to establish business credit is to use Nav. Business Boost comes with an important feature called tradeline reporting. With tradeline reporting, we send positive payment information to the major credit bureaus that track businesses, which provides proof that you pay your bills on time. This may help build your business credit with the different bureaus. And because we understand life happens, we never send negative information like late or missed payments. 

Some business credit card accounts also have tradeline reporting for their cardholders, but this feature is not universal. So it’s not guaranteed that using a business credit card will automatically establish business credit. If possible, choose a credit card that will report to the major business credit bureaus.

We put together a list of vendors that offer tradelines to their customers. You can read the article here.

What If I’m Not Approved for a Business Credit Card?

If you get denied for an unsecured business credit card, you still have options. It’s typically a good idea to wait around six month before applying for a new credit card to make sure your credit score doesn’t take too many hits from the hard inquiries. In the meantime, you can take steps to build up your credit score. And when you’re ready to apply again, you can look into a different credit card that accepts applicants with your credit score range. Or you can apply for a secured business credit card that allows you to put down a refundable security deposit, and the deposit acts as your credit limit. Secured cards are typically easier to qualify for than unsecured credit cards.

Don’t waste time scrolling through countless credit cards. Instead, find the best credit card options for your business instantly with Nav.

Alternatives to Business Credit Cards for Bad Credit

If you get a business credit card, try to use it for business purchases so you can separate your business and personal finances. This will make it easier to keep track of your business spending for tax purposes.

Many traditional small business loans (such as bank loans or SBA loans) require good credit, but there are some types of business financing that may be more credit flexible or may not check personal credit at all. Lenders that make business loans for bad credit tend to be heavily focused on other factors such as revenues or time in business. They include:

  • Vendor accounts
  • Online loans
  • Business cash advances
  • Crowdfunding

For the above types of financing, revenues may be more important than credit history. A business bank account may be required so make sure you open and use one as soon as possible.

FAQs

This article was originally written on May 10, 2018 and updated on October 28, 2022.

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9 responses to “Best Business Cards for Bad Credit

  1. Have A LLC Business but have bad credit Personally.. What can I do to establish credit for my business?

  2. You’re website needs to re-adjust your scoring because you claimed I had a 90% approval factor with capital one, I had two cards with them for which I had opened and paid perfectly until I realized they never increased my credit Limit levers 5 months like they state. But must’ve fell in a 10% factor due to their decline notice for their ridiculous 25.99% APR Spark Card.

    1. We’re so sorry to hear you were turned down for the card you wanted. We are continually working with our issuer partners and technology to try to provide our customers with better insights through MatchFactor. We’ve found that our customers who use MatchFactor are 4 times more likely to be approved for a small business credit card but we’d like to increase that even more! We’re also working with some issuers to be able to provide full pre-approvals. We appreciate your feedback.

    1. Can you please tell me when can I got a secured business credit card? Thanks.
      I also like to know if you repair credit too ?
      I love your website ,
      best regards

      1. There aren’t many issuers offering secured business credit cards, however, you can try Wells Fargo (apply in a branch). You may also want to consider vendor accounts that don’t reply on personal credit. You can learn more at Nav.com/vendors.

        We are not a credit repair firm; however you can find a referral to one in the Nav Marketplace. (Scroll down to credit repair.)

        Thanks for the kind words!