Anyone who owns a business knows that being able to track and monitor your expenses while saving money is important. Credit cards can be a time-saving option that helps you make the most of each business expenditure and transaction.
Business credit cards come in a wide array of opportunities, including cashback rewards, travel points, loyalty status, credit building, and business management tools. The most important aspect of finding the right business credit card for you is identifying which factors matter most for you and your business.
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Best for Small Businesses
Rates & FeesOwning and starting a business can involve many moving parts. Keeping track of a complicated rewards program may not be a big priority. If you’re interested in earning rewards without a lot of extra time managing them, this is a great card for you. You don’t have to stay on top of rotating bonus categories; you get to choose two categories each month where your spending will earn 4x Membership Rewards points. Since you know where your business is spending the most money, this reward structure can be very beneficial.
The yearly fee of $295 might be considered high, but it makes sense if your business spends a lot. You can earn 70,000 Membership Rewards points if you commit to spending at least $10,000 on eligible purchases in the first three months of account opening.
Amex is partnered with over 22 airlines and hotels where you can redeem your Memberships Points, and this card offers many limited-time bonuses that allow you to earn even more points.
This might be better geared for an established company that knows they do a lot of spending and want to make money back. Smaller businesses may not yet have the capital to make this card affordable.
Best for New Businesses
Rates & FeesWhen you own a business, you know that it constantly changes, and needs are always growing. With Expanded Buying Power, you can spend beyond your credit limit when needed; however, this amount is limited to your credit record, payment history, and financial resources, among other factors.
The American Express Blue Business Cash Card is a well-rounded card that provides flexible financing options, a nice sign-up bonus, and capped rewards. This is one of the best available options for newcomer businesses for a no-annual fee card.
The zero-percent intro purchase APR for the first year makes this a boon for startups looking for cashback. However, since the rewards are capped annually, you may want to graduate to a card with higher rewards.
For a no annual fee card, the 2% cashback is one of the best rewards rates. However, after the $50,000 limit in combined purchases, the cashback rewards go down to 1%.
We recommend sitting down and calculating how much spending you will need to do on your card to see if this rewards structure works for you.
Best for Unlimited Cash Back
Chase’s Ink Business Unlimited® Card has a straightforward business rewards program. Combined with zero annual fees and unlimited 1.5% cash back on all purchases, those with Card Membership also get an enticing $750 bonus cashback for the first 7,500 you spend within three months of card membership.
That’s a pretty sizable cash bonus for a card that doesn’t charge you an annual fee.
This card remains uncomplicated, with zero spending categories you have to keep track of. Your Chase Ultimate Rewards points are worth one cent when redeemed for cash, either through a statement credit or a direct deposit.
If you’re trying to start or grow a business by making necessary purchases but can’t pay out of pocket, you have 12 months to enjoy 0% intro APR on purchases.
The Ink Business Unlimited card is perfect for businesses that need to finance eligible and other purchases over time.
Best for Business Travel Rewards
Capital One’s Spark Miles for Business is a good card if you’re interested in flexible rewards when making everyday eligible purchases. For example, you earn 2x miles for each dollar spent, and these miles are unlimited and never expire. You can earn 5x miles on all hotel and car rental purchases. Plus, you don’t need to keep track of spending or annual caps.
The Spark Miles card allows you to earn miles which you can then redeem for free travel. You can use the Capital One portal to redeem the miles you earned for almost any flight, vacation package, or hotel room. You can transfer earned miles to Capital One’s 15+ airline and hotel programs for further value.
As an added benefit for frequent flyers, you can get reimbursed for TSA Precheck and Global Entry, enjoy No foreign transaction fees while traveling, and even skip the security line!
Best Hotel Credit Card
Rates & FeesThe Hilton Honors American Express Business is a high-end business hotel credit card that can provide outstanding, ongoing rewards to elite-status Hilton fans, all for a relatively low $95 yearly fee.
Cardholders can earn 12x points on any purchase made with resorts and hotels through Hilton; 6x points on eligible business spending at gas stations, shipping, and telephone services; 6x points at restaurants, car rentals, and flights booked through Amex Travel; and 3x points on all other purchases.
As a Priority Pass member, you can enjoy ten complimentary lounge visits every year, a $299 value that comes with the Hilton Honors Gold status, instead of a complimentary hotel stay every year. This makes this card more valuable to business owners who travel frequently and want to take advantage of the lounge passes.
The luxury benefits of this card can easily outweigh the low annual fee, and with numerous Hilton destinations to choose from, you can easily redeem your points.
This hotel card is perfect if you are an ongoing Hilton business traveler without yet gaining Hilton status.
A business credit card is a type of card that is meant to be used primarily by a business instead of for your personal use.
These cards are available to any kind of business, no matter their size, so they can improve their credit and increase their future borrowing odds. Even freelancers or sole proprietors can apply for a business credit card — so long as you make any type of income.
In many ways, business credit cards function very similarly to personal credit cards in that you can earn rewards and accrue interest. You may be interested in learning that annual fees can be tax-deductible as a business expense. Business credit cards are typically high-limit credit cards, which can benefit you if you have many business expenses.
The bottom line is that not paying your monthly payment on time or going into default can impact your business credit and your personal credit.
Many credit lenders offer a wide variety of business credit cards, and they can be easier to apply for than business loans.
Business credit cards generally work similarly to personal credit cards, but they tend to offer cardholders better rewards rates and a higher credit limit. Many of them also offer business management tools that can help you track spending within different categories or employee spending.
You don’t necessarily need an EIN (employer identification number) to apply. Sometimes you can just use your own Social Security number.
Different cards can come with no annual fee or low annual percentage rates depending on the business’s credit history or the owner. The rewards structures are often different since businesses tend to focus their spending on travel, advertising, marketing, business supplies, and more.
Before applying for a card, you should track your business’ spending habits. Small businesses may be more interested in a higher cash back rate so they can pay their monthly balance with statement credits. More established businesses may want a travel card that earns them travel rewards or discounts.
Ultimately, having a credit card for your business can help you track spending through better records, save money, enjoy perks, and monitor employee spending.
Having a business or personal card can give you access to credit, but they both operate differently.
Individuals use personal cards for daily purchases on things like gas, groceries, and household necessities.
Business credit cards are only meant for businesses and business spending. If you use this card for personal spending, your account could be flagged and even terminated.
The main difference between both cards includes:
The type of card you apply for should depend on many factors, including your type of business, business expenditures, business revenue, and much more.
You can look for cards that are best for:
A good way to determine which one is best suited for your business is to sit down and track where most of your business spending is, and then look for a business credit card that can cut your expenses in those categories.
Anyone who has owned a small business or worked as a freelancer knows how waiting for invoices to be paid can be an endless cycle.
A small business credit card can ease your financial burden and invest in business resources that will help your company grow if you cannot pay out of pocket at the time.
Small-business credit cards also have other benefits.
When choosing a card, you should consider the following perks:
You can easily track your business and personal expenses when you separate them. When it’s time to pay taxes, you can easily see how much overhead you have and make deductions. Every time you use your card for business, you can lower your taxable income.
Plus, if you ever get audited for any unfortunate reason, your card statements can serve as a backup. Small-business credit cards can help prove that the business you run is not a hobby or a personal matter, plus they can track your spending into different categories to keep your bookkeeping simple.
Any freelancer or small business will tell you that cash flow is a major worry, especially if your client check hasn’t arrived in time to pay off expenses.
Business credit cards provide a revolving line of credit when you need to make a business expenditure without spending personal money. Just make sure that your business credit card is used solely for business. If you use it for personal spending, your account could be closed or frozen.
Business credit cards tend to have higher credit limits, and many offer an extension to your billing cycle. Some cards offer sign-up bonuses that allow you to rack on points within a certain time frame. Others may offer free employee cards, airline credits, access to airport lounges, and business tracking tools.
Using your small-business credit card can improve your credit score and lower your interest rates, which is necessary if you are considering applying for a business loan.
You don’t even need employees or an established business structure to be eligible for a small-business credit card. Today’s gig economy shows more people deciding to work for themselves. You can qualify if you run a business from home or even have a part-time business. While freelancing comes with plenty of risks, there are many rewards, especially if you have a small-business credit card to help you through lean times.
Small business credit cards are a good idea and can help you grow; just remember to use your card wisely and pay on time.
Small businesses can be privately-owned corporations or even sole proprietorships with less revenue than a mid-sized business or corporation.
In terms of credit, the main difference between corporate and small businesses lies in who is responsible for paying the debt. Smaller businesses rely on the primary cardholder to be liable for repayment, whereas corporate cards rely on the company itself. If your business is expanding and more employees are using credit cards for business expenditures, it makes sense to issue corporate cards instead of cards you are personally liable for.
Another thing to consider is potential rewards. Small business credit cards reward the person holding the Card Membership, but corporate cards mean the company keeps the rewards. Plus, rewards aren’t as lucrative with small business credit cards.
Choosing the right business credit card can be instrumental. There are various factors you should look at, including:
Determine where your business does most of its spending. If you notice you spend a lot on travel or office supplies, you should find a card that fits those needs and offers rewards.
Make sure you can afford an annual fee. Many cards that come with a yearly fee often offer incentives and rewards so you can recoup the cost of the fee with your business purchases. However, if you are a startup or a new business, you may want to consider a no annual fee card.
Are you planning on carrying a balance on your card? Look at the APRs on the cards you consider, as any balance you carry will accrue interest. If you plan to carry a balance, your best bet is a card with a very low APR, so you don’t have to spend too much.
If you’re looking for ongoing rewards and perks, pay attention to cash back cards and those with membership reward bonus points. Frequent travelers may want access to airport lounges, growing businesses may want free employee cards, and any business can benefit from business and account management tools.
Applying for a business credit card is similar to a personal card application. As a business owner, you can apply with an EIN (employer identification number) or your personal Social Security number.
Credit card lenders will base their decision on your established credit history, your business’ revenue, financial backing, and more.
Here’s are some important tips on how to apply for a business credit card:
1
No matter the type of business you own, the lender will pull a hard credit check on your personal credit report. The business credit card will be separate from your personal credit and will not impact your personal credit.
2
Personal credit ranges from 300 to 850, but business credit scores are on a scale from 0 to 100, with 0 meaning no credit or bad credit. This score is public so that you can access your score through business credit reporting agencies.
3
If you are a freelancer or sole proprietor, you just need to provide the same information as you would for a personal card application. If you are the owner of a corporation or an LLC, you may need to provide business-specific items like tax identification number, business name, business phone number and address, business income, and a personal guarantee. 2.
4
Once you have all your information, go ahead and apply online for the best credit card that fits your needs.
A great business card is subjective and hinges on your business needs, type of business, and business spending. As with personal credit cards, not all are created equal.
The characteristics that we keep in mind when selecting the best business cards involve:
Business cards that charge a yearly fee often also include perks and benefits that overshadow the annual cost as long as you meet minimum spending requirements. For example, the American Express® Business Gold Credit Card is tied with a relatively high annual fee of $295 but offers 70,000 Membership Rewards bonus points as long as you commit to spending at least $10,000 in the first three months. You will have to determine whether your business will benefit more from an annual fee or not.
If you plan to make a lot of business expenditures, you may want a business cash back card or one that offers bonus points for the category you spend most in. Since businesses typically have higher spending needs than individuals, the welcome offer is often paired with enticing sign-up bonuses.
We compared what different cards offer in terms of perks. These perks will suit different business needs. For example, an employee or business owner who travels a lot may be interested in travel-related benefits like access to airline lounges and Hilton hotel status.
Since credit lenders often pull from your personal credit score, this could be an important element to consider. Any business card application will make a hard credit inquiry on your credit report. If you are a startup, you may look for cards that don’t require credit history.
Holly D. Johnson is an award-winning personal finance writer who covers topics like insurance, investing, credit and family finance. As a leading voice in the travel and loyalty space, Johnson has traveled with her family to more than 50 countries over the last decade.
The author has also written extensively on the power of household budgeting, and she even co-authored a book on the topic. Zero Down Your Debt: Reclaim Your Income and Build a Life You’ll Love was originally published in 2017, and it teaches families how to use zero-sum budgeting to reach their financial goals. She is also the co-owner and founder of the family finance and travel website, ClubThrifty.com.
Johnson’s 10+ years of writing have focused on helping families make important financial decisions at each stage of their lives. The author also applies the financial principles she teaches to her own life, and she is currently on track to retire in her late 40’s with her partner. She currently lives in Central Indiana with her husband and children, and she is a regular contributor for Bankrate, CNN, Forbes, U.S. News and World Report Travel and many other notable publications.
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