Best Business Credit Cards for Startups

Best Business Credit Cards for Startups

Best Business Credit Cards for Startups

As the founder of a budding new company, there are plenty of good reasons for you to consider using a business credit card. Not only can it help you keep personal and business finances separate, it can come in handy covering cash flow, help build business credit, and put money in your pocket through perks and rewards. Here we share some of the best business credit cards for startups.

How to choose the best business credit card for startups

When considering a business credit card for your young business, you need to ask yourself a few questions:

  • Are you trying to build business credit?
  • Do you travel a lot and want travel rewards?
  • Are you looking for cash back rewards?
  • Do you want a 0% interest introductory APR?
  • What are your personal credit scores?

Once you’ve answered questions like these, you can narrow down your choices to find the right card.

Best Business Credit Cards for Startups

We’ve picked six great business credit cards for startups and categorized them to help you with your choice.

1. Best for Fair or Good Credit: Capital on Tap Business Credit Card

The Capital on Tap Business Credit Card is a business credit card that offers credit limits ranging from $1,000 up to $50,000. While many business credit cards require excellent credit scores, this card is more flexible. (In addition, it will be a soft inquiry on your personal credit.) There are no foreign transaction fees.

2. Great 0% intro APR offer: U.S. Bank Business Triple Cash Rewards World Elite™ Mastercard®

If you are looking for financing for your startup, a 0% APR credit card may be an excellent option. The U.S. Bank Business Triple Cash Rewards World Elite™ Mastercard® offers a solid intro APR: 0% for 15 billing cycles on purchases and balance transfers.

It also has a very appealing welcome offer for new cardholders. Limited Time Offer: Earn $500 in cash back. Just spend $4500 on the Account Owner's card in the first 150 days of opening your account.

You can also earn solid cash back rewards: Earn 3% cash back on eligible purchases at gas stations, office supply stores, cell phone service providers and restaurants. 1% cash back on all other eligible net purchases..

Plus, the annual fee is $0.

3. Rewards program for Amazon shoppers: Amazon Business Prime American Express Card

If your business will be regularly shopping on Amazon, AWS or Whole Foods check out the Amazon Business Prime American Express Card. For startups, an appealing benefit is that you get the choice of extra time to pay when cash flow is tight, or a high cash back rate when you pay quickly on specific purchases. Take advantage of 5% Back or 90 Day Terms on U.S. purchases at Amazon.com, Amazon Business, AWS and Whole Foods Market with an eligible Prime membership. You will earn 5% Back on the first $120,000 in purchases each calendar year, 1% Back thereafter..

4. Save with gas rewards: Costco Anywhere Visa® Business Card by Citi

If your business will take you on the road frequently, you may want a gas rewards credit card. A top pick is the Costco Anywhere Visa® Business Card by Citi. Great fuel prices already make Costco a popular place to fill up. Save more thanks to the general cash back rewards for fuel purchases: 4% cash back on eligible gas for the first $7,000 per year and then 1% thereafter, 3% cash back on restaurants and eligible travel purchases, and 2% cash back on all other purchases from Costco and Costco.com.. There is ​​no annual fee with your paid Costco membership.

5. Excellent Airline Rewards Card Welcome Offer: Delta SkyMiles® Gold American Express Card

If you’re a Delta frequent flier, you’ll want to consider a Delta co-branded credit card, which offers cardmembers the opportunity to earn points toward flights, priority boarding, free checked bags and more. If it’s a generous welcome offer you’re looking for, the Delta SkyMiles® Gold American Express Card can be very rewarding.

If you’re willing to pay a higher annual fee, consider the Delta SkyMiles® Platinum Business American Express Card for even more rewards.

6. Rewards and welcome offer: American Express Blue Business Cash™ Card

Th American Express Blue Business Cash™ Card combines solid cash back rewards with an 0% APR intro offer and a cash back welcome offer, making it a great choice overall.

How to get the most from a business credit card

Not all cards are created equal. You’ll want to choose one that best fits the needs of your new business. If you’ll travel often, for example, you might want to go with a card that offers great travel rewards, such as points you can use toward airfare or hotel rewards. Sign-up bonuses or bonus points for certain types of spending (at restaurants, for example) can offer even more value the first year.

Cash back rewards are also very popular, as you can spend the cash any way you choose. Some cards like Discover are known for solid cash back rewards. With the Discover IT® Business Credit Card, for example, you can earn 1.5% cash back on every business purchase and Discover will match it all at the end of your first year.

*All information about the Discover IT® Business 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 the Nav Credit Card Marketplace.

Other cash back cards may offer higher cash back rewards in certain spending categories, such as gas stations or office supply stores. Try to anticipate your spending to make sure you choose the right card, but keep in mind you can shop for a new card if your needs change.

If you’re looking to transfer existing debt from a high cost loan or credit card, you’ll want to choose a card with a low interest rate or 0% introductory APR offer. Keep in mind most credit cards carry a variable APR, and will set the rate at least in part based on the applicant’s creditworthiness.

A business credit card can also be a great way for a newer business to build business credit. If the card reports to the business credit bureaus (not all of them do), a good payment history will help you demonstrate the ability to make timely payments—one of the first steps to building a good business credit profile (even if your credit is less-than-perfect right now).

Picking the right rewards card will help you leverage the purchases you’re already making to get rewards, discounts or cash back. And, a 0% APR introductory rate will help your business access a little extra cash when you need it at 0%—provided you make your credit card payments on time. Most credit card issuers reserve the right to raise your rate on your business credit card if you pay late, so make sure you stay on top of when credit card payments are due. Better yet, set up automatic payments.

How to qualify for a business credit card for startups

Small business credit cards are one of the few business loans available to startups without at least a year in business or strong business revenues. (And yes, when you carry a balance, you’re accessing a loan; the credit card issuer is the lender.) There are a few business credit cards with minimum business revenue requirements but most will accept income from all sources, and will ask questions about the business as well as personal finances to qualify. Almost every card requires a personal guarantee.

What credit score is needed to get a business credit card?

The vast majority of small business credit cards require excellent credit. Many require minimum personal credit scores of 720 or higher, though there are some that are more flexible. Very few business card issuers check business credit scores, though it’s a good idea to build business credit for your startup as soon as possible.

Can I get a business credit card with bad credit?

Only a few issuers offer business credit cards to those with bad credit, and those typically come in the form of secured business credit cards. If you don’t have a good credit history, you may want to consider other financing options for startups such as crowdfunding or net-30 vendors; both of which rarely check personal credit.

In addition, you may want to consider a personal credit card available to those with lower credit scores to establish a positive payment history such as the Credit One Bank® Platinum Visa® for Rebuilding Credit.

How to get a business credit card for startups

Most startups will apply for a business credit card online, though the bank where you have your business bank account might also offer a business credit card. Nav’s business credit card marketplace is a good place to start. Business owners that use Nav’s MatchFactor are 3.5X more likely to get matched to a credit card.

What do I need to apply for a business credit card?

You can often apply for a business credit card as soon as you start your business. That’s true even if you are a sole proprietor, freelancer or independent contractor with no employees. However, these cards are designed for small business owners so you will likely need to provide an Employer Identification Number (EIN) for your business, so it’s a good idea to get that from the IRS. (Of course a Social Security Number will also be required for the personal credit check.)

Also, if your goal is to build business credit, keep in mind the details you provide about your business may wind up on your business credit reports, so think about the address and phone number you want to provide.

If you have employees and want to issue employee cards, be prepared with the employee names for those cards. (You can also request them later if you choose.)

Why use a business credit card for my new business instead of my personal credit card?

Well, glad you asked. Here are three serious advantages to using a business credit card for business purchases:

  1. Having a business credit card allows you to keep your personal and business expenses separate. You’ll be able to track business spending more easily, making tax time, as well as maintaining a company budget, much less of a headache.
  2. By getting a card in the name of your business you’ll start to establish a business credit score separate from your personal one. That means that if you have to make a late payment, your business credit will take the hit instead of your personal credit (there are exceptions—read about which business credit cards report to personal credit bureaus here).
  3. As you start to establish a business credit profile, you’ll build your business’s credibility. When it comes time to apply for other business financing, solid business credit scores can help you qualify for more financing at better rates.
  4. Business credit cards offer superior fraud protection compared to business debit cards, checks or cash.

Some entrepreneurs may be hesitant to use credit because they are afraid they will be tempted to run up debt. In that case, a business charge card can be the best business credit card option for some new businesses. Charge cards must be paid in full each month, making it a good alternative to business credit cards for startups which allow you to carry a balance from month to month.

The National Small Business Association conducted a survey in 2017 that showed business credit cards to be the second most popular source of financing for small businesses. Carefully determine which type of business credit card you need, and join the ranks of entrepreneurs whose mastery of this important resource plays a continuing and vital role in their success.

This article was originally written on May 11, 2018 and updated on August 19, 2021.

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ABOUT AUTHOR

Gerri Detweiler

Education Director for Nav

Gerri Detweiler is Education Director for Nav. Known as a financing and credit expert, she has been interviewed in more than 4000 news stories, and answered over 10,000 credit questions online. Her articles have been widely syndicated on sites such as MSN, Forbes, and MarketWatch. She is the author or coauthor of five books, including Finance Your Own Business: Get on the Financing Fast Track. She has testified before Congress on consumer credit legislation.

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8 responses to “Best Business Credit Cards for Startups

  1. I have two vendor accounts that are not reported on my business report. How do I get these accounts added to my business report through my Established Business plan with Nav?

    1. Unfortunately Nav cannot report other vendors accounts. (We report for our customers with Business Boost or Business Loan Builder accounts.) You’ll need to ask those vendors to report directly to credit bureaus.

  2. I’m looking at the capital one spark cash select business card. Do you have any idea what credit is needed?? I’m getting so many different scales on the internet. Thank you

    1. The issuers aren’t eager to publish minimum credit scores (and the score you see may be different than the one they use). It may help to have a Nav account and see which cards are a good match. It’s not full preapproval but it should help to get you in the ballpark.

  3. Hi I just heard about Nav , I have a decent credit FICO 740; also I have my LLC company with out credit history since 2007 was launched, my question is about create a credit to my company with just my EIN and create a trade lines separate from my personal credit, it’s possible?
    Thanks