If you're a new business owner (or considering becoming one) you're probably learning that it takes money to make money. Fortunately, business credit cards can help you cover many of the expenses associated with keeping your enterprise running. If you've never applied for one of these cards before, don't worry — CNBC Select breaks down everything you need to know to get started.
What we'll cover
- What credit score do you need for a business credit card?
- How do you apply for a business credit card?
- What are the best business credit cards?
- Bottom line
What credit score do you need for a business credit card?
Similar to a business loan or any other line of credit (and we have plenty of recommendations), getting approved for a business credit card largely depends on your credit score and history. According to credit reporting bureau Experian, the majority of small business credit card issuers tend to approve applicants with credit scores of at least 670.
Of course, some credit card issuers cater to business owners with low or no credit score. The Capital One Spark 1% Classic card, for instance, is one contender that's most ideal for business owners with an average credit score (580–669).
Capital One Spark 1% Classic
Learn More
Information about the Capital One Spark Classic has been collected independently by CNBC Select and has not been reviewed or provided by the issuer prior to publication.
Rewards
Earn unlimited 5% cash back on hotels and rental cars booked through Capital One Travel and 1% on all other purchases
Welcome bonus
None
Annual fee
$0
Intro APR
None
Regular APR
30.74% variable
Balance transfer fee
None
Foreign transaction fee
None
Credit needed
Average
Terms apply.
It's always a good idea to ask questions about a specific issuer's eligibility guidelines before you spend the time and effort applying.
How do you apply for a business credit card?
Once you decide which business credit card is right for you, you can begin the application process, which is similar to applying for a personal credit card. However, you'll have to include some additional details about your business.
You'll want to make sure you have documents related to your business name and registration, any licenses, business address and phone number. You'll also need to supply your employer identification number.
Once you input this information online (or hand it over to whomever you're working with at the issuer), you'll just have to wait for approval and for your new business credit card to arrive in the mail.
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What are some good business credit cards?
Business credit cards have a wide range of benefits and perks, so when picking one you want to consider how you plan on using it.
For example, cards such as theInk Business Preferred® Credit Card, are ideal for earning travel rewards on common business expenses. This card has a very attractive welcome bonus offer of 100,000 points after you spend $8,000 on purchases in the first three months from account opening. These points are worth 25% more when you redeem them fortravel through Chase Travel℠ so you can use your points to book potentially free travel for your business trips.
Ink Business Preferred® Credit Card
On Chase's secure site
Rewards
Earn 3X points per $1 on the first $150,000 spent in combined purchases in select categories each account anniversary year (travel; shipping purchases; internet, cable and phone services; and advertising purchases with social media sites and search engines), 1X point per $1 on all other purchases
Welcome bonus
Earn 100k bonus points after you spend $8,000 on purchases in the first 3 months from account opening. That's $1,000 cash back or $1,250 toward travel when redeemed through Chase TravelSM
Annual fee
$95
Intro APR
None
Regular APR
21.24% - 26.24% variable
Balance transfer fee
Either $5 or 5% of the amount of each transfer, whichever is greater
Foreign transaction fee
None
Credit needed
Good/Excellent
Terms apply.
Read our Ink Business Preferred® Credit Card review.
If your business involves shipping a lot of goods to customers, consider a card like The American Express® Business Gold Card. This card's rewards program will assign the highest rewards rate to the two eligible spending categories where you spend the most money each billing cycle. One of those spending categories, U.S. shipping, includes eligible shipping costs from FedEx, UPS and the United States Postal Service (USPS).
American Express® Business Gold Card
On the American Express secure site
Rewards
Earn 4X Membership Rewards® points on the 2 categories where your business spends the most each billing cycle from 6 eligible categories. While your top 2 categories may change, you will earn 4X points on the first $150,000 in combined purchases from these categories each calendar year (then 1X thereafter). Only the top 2 categories each billing cycle will count towards the $150,000 cap. 3X Membership Rewards® points on flights and prepaid hotels booked on amextravel.com using your Business Gold Card.
Welcome bonus
Earn 70,000 Membership Rewards points after you spend $10,000 on eligible purchases within the first three months of card membership
Annual fee
$295 ($375 if application is received on or after 2/1/24)
Intro APR
Not applicable
Regular APR
19.49% - 27.49% variable
Balance transfer fee
N/A
Foreign transaction fee
None
Credit needed
Excellent
See rates and fees,terms apply.
Bottom line
The process for gaining a business credit card is rather simple — the hardest part is probably deciding which credit card best suits your needs. There are so many strong contenders offering an array of perks and welcome bonuses but make sure you do your homework before signing on the dotted line.
Why trust CNBC Select?
At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every article is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of credit card products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.
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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
As a seasoned financial expert with a focus on business credit and financial management, I've spent years navigating the intricacies of credit cards, loans, and financial strategies for entrepreneurs. My expertise is grounded in practical experience, having advised numerous startups and small businesses on optimizing their financial structures and leveraging credit effectively.
Let's delve into the concepts covered in the provided article:
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Credit Score and Approval for Business Credit Cards: The article mentions that approval for a business credit card hinges significantly on the applicant's credit score and history. Specifically, a credit score of at least 670 is recommended for most small business credit card issuers. However, there are options available for business owners with lower credit scores, such as the Capital One Spark 1% Classic card, which targets those with an average credit score ranging from 580 to 669.
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Application Process: Applying for a business credit card resembles the process for a personal credit card but requires additional details about the business, including its name, registration documents, licenses, address, phone number, and employer identification number (EIN).
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Best Business Credit Cards: The article highlights two notable business credit cards:
- Ink Business Preferred® Credit Card: This card is ideal for earning travel rewards on common business expenses. It offers a substantial welcome bonus of 100,000 points after spending $8,000 on purchases in the first three months, which can be worth more when redeemed for travel through Chase TravelSM.
- The American Express® Business Gold Card: Designed for businesses with significant shipping expenses, this card offers rewards tailored to the two eligible spending categories where the business spends the most each billing cycle. It also provides a generous welcome bonus of 70,000 Membership Rewards points after spending $10,000 on eligible purchases within the first three months.
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Considerations for Choosing a Business Credit Card: When selecting a business credit card, factors to consider include the intended usage, rewards structure, welcome bonuses, and fees. It's crucial for business owners to assess their spending patterns and priorities to choose a card that aligns with their needs.
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Trustworthiness of CNBC Select: The article concludes by affirming CNBC Select's commitment to providing high-quality service journalism and consumer advice based on rigorous reporting by expert writers and editors. They emphasize their independence from commercial influences and dedication to journalistic standards and ethics.
By covering these key concepts, the article aims to empower new business owners or aspiring entrepreneurs with the knowledge needed to navigate the realm of business credit cards effectively.
