How to Get a Business Credit Card? A Complete Guide Key Points: Business credit cards are designed especially for business owner to take charge of their finances. Types of Business cards: Travel business cards Cash back business cards Secured business credit cards Unsecured credit cards How to get a business credit card? Visit the bank or fill out an online application. Submit personal and company details. Complete the verification process.
Running a business can be overwhelming at times, and managing the finances can be one of the most difficult aspects.
Navigating through crises requires financial resilience strategies; having a business credit card can do wonders for you.
However, small and micro-business owners can relax with the help of business credit cards. Yes, it is true that credit cards designed to help businesses can be an asset to you.
If you are wondering how to open a business credit card and everything else, let us smooth the process for you. In this blog, you’ll get an insight into how to get a business credit card, the application process, how to
calculate repayments, and its benefits.
So without any further ado, let’s dive in!
Requirements for Applying for Business Credit Cards
The same information that you would need to apply for a personal credit card is also required when applying for a business credit card. The application will ask for your
name, email address, phone number, and mailing address, among other basic contact details.
Additionally, you need to
submit several documents particular to your company, such as the following: Company name Place of business Years of operation Annual income Monthly spending estimates made with the card
You also need to
provide your tax identification number (TIN). This could be your company’s EIN if it is incorporated or your Social Security number if you’re an LLC with just one member or a sole proprietor.
Along with stating your role within the company, you also need to
provide the Social Security numbers of any business partners who own more than a particular percentage of the company, typically 20 percent or more.
A card application may also require some sort of verification about the nature of your company (for-profit or not), the number of employees, and the number of additional cardholders, depending on the issuer.
How to Get a Business Credit Card?
As we have already discussed, there are requirements to open a business credit card account. Once you have all the documents, all you need to do is
go to the branch of any bank or financial institution or submit an online application.
Provide the bank with certain details, such as your annual income, mobile number, and type of occupation, and they will create the perfect credit card account for you.
Also Read: Reprise Financial Reviews: Fees, Login, Application Process, And Customer Reviews Types of Business Credit Card
Before you apply for a card, you must keep your priorities on the table and ask yourself what your business needs. As a
business owner, it is important to know what your business needs, and if you’re going to use your credit card for your business, you need to choose the right one.
Once you figure it out, go ahead and look for the types of business cards.
Secured Business Credit Cards
Businesses can establish or restore their company credit history, and credit score with a secured business credit card. The requirement for a security deposit sets it apart from a standard credit card.
business must provide collateral in the form of a deposit into a bank account if you are approved. Usually, your credit limit is the same as the amount of the deposit. While the account is secured, you are unable to access the security deposit money in any way.
The financial institution will report your activity to the main business credit bureaus and handle your transactions and payments just like they would with a standard credit card. If your company is run responsibly, it may eventually establish a good credit history and credit score, which will make it easier to get other types of non-secured financing. You can find many secured cards such as
Bilt credit cards to help your company. Unsecured Business Credit Cards
credit limit on an unsecured business credit card is determined by the creditworthiness and financial history of the cardholder. The money you spend on them is added to your balance and subtracted from the amount of available credit, just like with secured credit cards.
The distinction is that there is
no security deposit needed to open a business credit card. Travel Business Cards
Travel credit cards for businesses have advantages that can help small business owners save money. You might not be able to benefit from the rewards that these cards provide if you don’t travel frequently.
However, if you travel frequently,
using a travel credit card may be very beneficial. There is a lot of potential for earning points with these cards, as many of them offer up to 5X rewards on travel-related purchases. Furthermore, certain credit cards offer sign-up bonuses that can be used to pay for your next flight. Cashback Cards
You can earn rewards on a wider range of purchases when you use cards like
Avant credit cards and Verizon credit cards, that give cash back. Apply for a cash-back rewards card with a flat rate that gives you the same earning potential on every purchase, or choose a cash-back card with rewards that correspond to your line of business.
Additionally, a lot of business cashback credit cards come with lucrative welcome bonuses, which are especially beneficial for small business owners who need extra money for expansion.
So, these are the types of business credit cards you can get your hands on. Moving ahead, let’s look at the things you need to check for comparing them.
How to Compare Business Credit Cards?
There are a plethora of options available, and it can be quite confusing. Here are some of the tips and factors that will help you choose the right one for you.
Annual Fees: Most business credit cards come with a spending cap that must be met before the annual fee is waived. Choose cards that provide you with great benefits at no cost. Additionally, there are credit cards with no yearly fees. APR: Even though most business owners only compare credit card features and benefits, it is more important to compare the APR first. The interest you must pay if you don’t pay off your credit card debt in full each month is called the annual percentage rate, or APR. This is especially true for business owners who are aware of how challenging it will be to make their monthly payments in full. If you’re looking for a card with fair APR, you can choose Credit One as it may suit your needs. It is the one that strikes the ideal mix between a fair annual percentage rate and the features and perks you’ll use the most. Sign Up Bonus and Rewards: This is not a major consideration when applying for a credit card, but we recommend that you look for cards that offer sign-up bonuses and other reward programs. It will help you maximize your earning potential. You will find many business cards, like Reflex credit cards that offer welcome bonuses and frequent cashback on spending.
These are the points that you need to keep in mind when opening a business credit card that suits your business needs.
Who Should Open a Business Credit Card Account?
Credit cards designated for business purposes are not meant for individual use. Business cards are divided into two groups: corporate and small business cards.
Small business cards are given to start-ups, while corporate cards are given to large, established businesses. Small business cards typically have no liability attached to them; however, corporate business cards may have liability attached to either the individual or the business.
any person running a business can apply to open a business credit card account by fulfilling all the details required in the procedure.
Now that you know this, let’s go ahead and see why you should get one in the next section.
Why Should You Consider Getting a Business Credit Card?
There are many benefits that you can reap from getting a business credit card. Let’s discuss them here.
Track the expenses: You can separate your business and personal expenses with a business credit card, making it simple for you to keep track of your spending. Just like every business needs analytics, it also needs a specific card for business related-transactions. Build business credit: You can keep business financial health in check while boosting credit history. Your credit history helps in your ability to obtain credit lines, loans, leases, and even business insurance. However, make sure your track record is clean, as failing to pay on time will hurt your business score. Business-related benefits: Business cards offer a unique set of advantages. You receive rewards for using the card to make business-related purchases such as shipping, hotel and flight bookings, and advertising. In comparison to a personal credit card, it has a higher credit limit, too.
So this was all about how to apply for business credit cards, the requirements, and the benefits of opening a business credit card account. This blog will help you make smart financial decisions that are right for your company.
Read Next: Banana Republic Credit Card: How to Login and Pay Bills in 2024? Frequently Asked Questions Ans: You can apply for business cards by submitting documents, as well as personal and company information, to the card issuing company. Ans: You can get a minimum limit of $3000-$5000. You can scale up to higher limits if you have excellent CIBIL scores. Ans: Yes, you can have more than two cards that can help in managing finances. Sources