HomeBusinessHow To Get A Business Credit Card

How To Get A Business Credit Card

photographer checking his laptop in his studio

JGI/Tom Grill/Getty Photographs

Key takeaways

  • A enterprise bank card is a instrument that may assist small enterprise house owners and entrepreneurs maintain their private and enterprise funds separate.
  • These business-focused playing cards usually provide perks like sign-up bonuses, rewards and annual journey or business-related credit.
  • When making use of for a enterprise card, you may present primary details about your enterprise, together with your function within the firm, in addition to a Social Safety quantity or Employer Identification Quantity.
  • In case your utility is denied, observe up with the issuer to study why. If it is as a result of a low credit score rating, you could possibly get a secured enterprise bank card.

Within the early, chaotic days of beginning a brand new enterprise, it’s simple to blur the road between your private funds and your enterprise funds. It’s possible you’ll be financing your enterprise out of your individual pocket, for instance, with all enterprise income turning into your private earnings.

However to simplify your funds on your future self, it’s a good suggestion to maintain your private spending separate from your enterprise. Making use of for a enterprise bank card is a good first step. A devoted enterprise bank card can assist you retain monitor of your enterprise spending. It additionally offers flexibility if you happen to want short-term financing — like when enterprise payments are due however you’re nonetheless ready for cost on buyer invoices. You can too earn profitable rewards and benefit from different perks — only for making essential enterprise purchases. As a bonus, any curiosity you pay on a enterprise bank card is tax-deductible when used solely to make enterprise purchases.

And enterprise playing cards aren’t only for enterprise newcomers — enterprise veterans can profit from buying round for higher playing cards providing stronger advantages that match your rising enterprise. And, importantly, your rising enterprise credit score rating.

Right here’s what to contemplate when deciding on a brand new enterprise bank card, together with learn how to examine the market and steps to making use of.

1. Decide your eligibility

Most of the prime enterprise bank cards require good to wonderful credit score, and issuers are doubtless to make use of your private credit score rating in estimating your enterprise’ creditworthiness if you happen to haven’t but constructed up a enterprise credit score rating.

It signifies that a enterprise bank card has the potential to have an effect on your private credit score. Once you apply for a enterprise bank card, you’ll doubtless incur a tough inquiry in your credit score that seems in your credit score report and briefly drops your rating by a number of factors.

And once you start utilizing the cardboard, issuers will report your card exercise to the credit score bureaus. Whereas some solely report enterprise bank card exercise to the enterprise credit score reporting companies, others might also report back to the non-public credit score bureaus — particularly in case your account is just not in good standing.

It may be robust for these with low credit score scores to qualify for an unsecured enterprise bank card. On this case, a secured bank card could be simpler to qualify for. They require a money safety deposit upfront, however with decrease credit score rating necessities. And with most playing cards, you possibly can graduate to an unsecured card after a interval of accountable, on-time funds.

2. Collect required utility data

Collect private, monetary and enterprise particulars wanted to finish the appliance, together with:

  • Enterprise title and call data. You’ll want to offer figuring out details about your enterprise, reminiscent of your enterprise title, deal with and cellphone quantity. Many entrepreneurs’ enterprise and private contact data is similar, which is okay.
  • Your function within the firm. In the event you’re making use of for a enterprise bank card, chances are high the lender will wish to know who you might be and what your function on the firm is. That is related as a result of it tells them who’s accountable for any debt gathered on the account.
  • Your annual enterprise earnings. Just like how it’s essential to submit your private earnings data once you apply for a private bank card, you’ll want to offer your enterprise earnings once you apply for a enterprise bank card. In the event you’re a brand-new enterprise that hasn’t generated earnings but, you could must report your earnings as $0 in the meanwhile.
  • Enterprise particulars. Whereas particulars range by utility and issuer, you could want to offer details about your enterprise, such because the business you’re in, how lengthy you’ve been in enterprise and what number of staff you may have.
  • Supporting documentation. Lenders gained’t all the time ask for supporting documentation, however they could request you present them with data that proves you may have a enterprise. At this level, an Employer Identification Quantity (EIN) or tax ID quantity can turn out to be useful.

3. Evaluate enterprise bank cards

With so many choices available on the market, it could possibly take time to search out the perfect enterprise bank card for your enterprise. When buying round, you’ll wish to examine options like charges, rewards and rates of interest.

Enterprise bank card rewards usually align with particular spending classes, so it may be useful to find out the classes you spend essentially the most in. For instance, your enterprise could require frequent journey, through which case an airline enterprise bank card providing rewards and perks can assist you earn rewards that pay for future journey.

Or, you may favor the flexibleness and premium advantages of a versatile enterprise rewards card like The Enterprise Platinum Card® from American Categorical, which provides 5X factors on flights and pay as you go lodges booked with American Categorical Journey, plus 1.5X factors on as much as $2 million spent per calendar yr on eligible purchases in key enterprise classes and on eligible purchases of $5,000 or extra.

Alongside rewards and perks, it’s necessary to maintain each rates of interest and charges in thoughts when selecting a enterprise bank card. Many enterprise bank cards provide 0 % intro APRs on purchases, which is like offering free short-term enterprise financing — so long as you possibly can repay your stability earlier than that introductory interval ends and the common rate of interest kicks in. And lots of prime enterprise playing cards include annual charges, too. As an illustration, the Amex Enterprise Platinum comes with a $695 annual price — although with the potential for perks and advantages to outweigh that value.

4. Apply and wait on your card approval

After you submit your utility, you’ll want to attend for the cardboard issuer to evaluate it. If it’s a web-based utility, it might be permitted in minutes, however it’s additionally attainable it might take a number of days. In the event you’re permitted for a card, your issuer will mail your card, which generally takes every week or two after approval. Typically, the issuer may want to interact in a extra detailed evaluate or ask for extra enter from you, extending the method a bit longer.

In case your utility for a enterprise bank card is denied, observe up with the issuer to study why and whether or not you possibly can treatment the state of affairs. If it’s a credit score rating challenge, you could possibly qualify for a secured enterprise bank card. Because you’ll be placing down a safety deposit for a secured card, it could possibly assist the issuer overlook your credit score points. After responsibly utilizing the cardboard for some time and increase your credit score, you can be eligible for an unsecured enterprise bank card.


The underside line

It takes some work to get a enterprise bank card, however doing so is useful for monitoring your enterprise spending — and it could possibly assist make managing your enterprise and private funds a complete lot easier.


Most Popular