Comparing Business Credit Card Offers
Updated: January 15, 2019
If you’re a small business owner, you probably don’t have time to sort through a laundry list of business cards and complicated rewards schemes. But if you’re looking for the right card for your business heading into the 2019 fiscal year, it pays to sweat the details.
A good business card can help you invest more in your company, smooth out fluctuations in your monthly cash flow and build a better credit score for your business. It can also help you organize your expenses and monitor your employees’ spending.
Even better, many of the best business credit cards nowadays come packed with generous rewards that help you trim expenses and enjoy exclusive benefits. Here, we look at:
Whether you want to understand more about how to properly use a business card or how to build business credit, we can help.
How business credit cards work
Business credit cards are designed for business use rather than private individuals who have cards for their personal use. They are often used to build a company’s credit history, improve its cashflow and keep business expenses separate from personal charges.
Business credit cards are a powerful tool to organize expenses, earn rewards, and save on interest payments. Even if your business's spending is modest, choosing the right business credit card can save you large sums of money each fiscal year.
Of the 368 business credit cards we analyzed, we hand-picked 40 cards for in-depth individual reviews. Some 28 out of these 40 business cards in our reviews database include a points- or miles-based rewards program – 4 for airline miles, 3 for hotel points, and 21 are general rewards cards. Cash back cards constitute 12 out of the 40 business credit cards.
As far as bonus categories for spending go, "travel and transportation" is by far the most common bonus category among the cards in our review set, with 17 of 40. Flat-rate rewards cards are also very common, constituting 13 out of the 40 cards in our review set.
CreditCards.com's best business credit cards of 2019:
|Business Credit Card||Best For:||Rewards Rate||Annual Fee||CreditCards.com Rating|
|Ink Business UnlimitedSM Credit Card||Flat-rate rewards on business purchases||1.5% unlimited||$0||3.6 / 5|
|Capital One® Spark® Cash for Business||Free employee cards and unlimited 2% cash back||2% unlimited||$0 intro for first year; $95 thereafter||4.2 / 5|
|Bank of America® Business Advantage Cash Rewards Mastercard® credit card||Business travel purchases and bonus for Business Advantage clients||3% at gas stations and office supply stores**||$0||2.5 / 5|
|Ink Business CashSM Credit Card||Cash back with high rewards rate on office supplies||5% on office supplies, internet*||$0||3.4 / 5|
|Capital One® Spark® Miles for Business||Bonus miles and international use||2X on all purchases||$0 intro for first year; $95 thereafter||4.3 / 5|
|Ink Business PreferredSM Credit Card||Sign-up bonus and high rewards on select business categories||3X on travel, select business categories***||$95||3.9 / 5|
|The Blue BusinessSM Plus Credit Card from American Express||Flexible credit limit and long intro 0% APR period||2X||$0||4.3 / 5|
|Southwest Rapid Rewards® Premier Business Credit Card||Domestic business and flights||2X on Southwest purchases, hotel and car rental partners||$99||3.5 / 5|
|Capital One® Spark® Cash Select for Business||No expiration on rewards and small business perks||1.5% unlimited||$0||3.6 / 5|
|U.S. Bank Leverage™ Visa Signature® Card||Automatic rewards on top two categories||2X on the 2 categories where you spent the most each month||$0 intro for first year; $95 thereafter||N/A|
*Earn 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on internet, cable and phone services each account anniversary year
**Up to $250,000 each calendar year, 1% after that
***Up to $150,000 annually, then 1 point per dollar
Research methodology: what we considered
Business credit cards analyzed: 368
Criteria used: Rewards categories, rewards rates, redemption options and flexibility, sign-up bonus, customer service, small business perks, annual fee, other rates and fees, security, credit needed, ease of application
Editor's take on the best business credit cards
Most of our favorite business cards offer generous sign-up bonuses after required spends in the first 3 months of card membership, and in the case of Capital One Spark Cash, also in the first 6 months. That means if you get a business card the beginning of 2019, you can earn a bonus the first quarter of the year, then use it in numerous ways to benefit your business.
Also, something to note in February 2019 are the changes coming to The Business Platinum Card from American Express, including free access your first year to WeWork; a $200 statement credit with Dell; and a $100 credit with Hotel Collection, although the annual fee will be upped to $595.
Ink Business UnlimitedSM Credit Card
Even with no annual fee, the Ink Business Unlimited has a nice sign-up bonus of $500 after a $3,000 spend within the first 3 months of card membership.
At 1.5% back on all purchases, you can get better rewards on everyday business expenses with The Blue Business Plus.
Capital One® Spark® Cash for Business
For a limited time, you can earn up to $2,000 bonus – $500 after a $5,000 spend within the first 3 months, and $1,500 after a $50,000 spend within the first 6 months.
Given the $95 annual fee (waived the first year), the 2% cash back on all purchases could be better. Also, the regular APR of a variable 19.24% is high.
Bank of America® Business Advantage Cash Rewards Mastercard® credit card
The tiered ongoing rewards of this card are unparalleled for a card with no annual fee, with 3% cash back at gas stations and office supply stores (up to $250,000 each calendar year, then 1%) and 2% cash back at restaurants. Also, earn up to 75% bonus on your rewards based on your banking relationship.
In terms of sign-up bonuses, you can do better with the Ink Business Unlimited.
Ink Business CashSM Credit Card
This card has the rewarding sign-up bonus of the Ink Business Unlimited – $500 after a $3,000 spend within the first 3 months of card membership. Also, the tiered categories are excellent, with 5% back on the first $25,000 in combined purchases at office supply stores and internet, cable and phone services each anniversary year, as well as 2% back on the first $25,000 in combined purchases each calendar year at gas stations and restaurants.
Unfortunately, the ongoing rewards are limited in how much you can benefit because of the maximum spend.
Capital One® Spark® Miles for Business
No one comes close to the Capital One Spark Miles for Business' limited time offer – earn 50,000 miles after a $5,000 spend within the first 3 months and another 150,000 miles after a $50,000 spend within the first 6 months.
There's a $95 annual fee (although it is waived the first year) and the regular APR is a high variable 19.24%, making it not a good choice if you plan to carry a balance.
Ink Business PreferredSM Credit Card
With a hefty sign-up bonus of 80,000 points after a $5,000 spend within the first 3 months, this is a stellar business card. And those 80,000 points are worth $1,000 toward travel when you redeem through Chase Ultimate Rewards.
Unfortunately, the $95 annual fee is not waived, something you'll want to factor in when considering this card.
The Blue BusinessSM Plus Credit Card from American Express
This card allows you to earn 2X points for up to $50,000 a year on business expenses like office supplies and client dinners, and 1 point per dollar thereafter. Also, the Blue Business Plus allows trusted partners or employees to manage your account and allows you to add receipts and notes to your transactions.
There's a limit to how much you can earn with 2X points, up to $50,000. Also, there's no introductory bonus.
Southwest Rapid Rewards® Premier Business Credit Card
If you find yourself spending a fair amount of time on domestic flights, this card can reward you for those business trips. Earn 60,000 points as a sign-up bonus – that's after a $3,000 spend within your first 3 months of card membership. Also, earn 6,000 points after your cardmember anniversary. Ongoing rewards include 2X points on Southwest purchases, as well as purchases at partner hotels and car rental operations.
If you conduct a fair amount of international travel, this may not be the best card for you, because Southwest's foreign destinations are limited. Instead, consider The Blue Business Plus.
Capital One® Spark® Cash Select for Business
This card's 1.5% cash back on all purchases rivals that of the Ink Business Unlimited, and it has no annual fee. Also, the cash back is unlimited, unlike the Ink Business Cash and the Ink Business Preferred.
The Capital One Spark Cash Select's sign-up bonus is only $200 after a $3,000 spending within the first 3 months, $300 less than the Ink Business Unlimited's sign-up bonus, which is $500 after a $3,000 spend within the first 3 months.
U.S. Bank Leverage™ Visa Signature® Card
This card's rewards rate is a solid 2X back on two select categories, which are automatically set to the two categories where your business spent the most during each month. These are chosen from a total of 48 categories, which include advertising, airlines, computer stores, hotels, restaurants, utility companies, and much more. Everything else earns 1X point per dollar spent. You can also earn one extra point per dollar up to 100,000 bonus points for all eligible net purchases in your first 365 days.
There is a $95 annual fee, although this is waived for the first year.
How to apply for a business credit card
You may assume that you have to be the owner of a business with multiple employees and an office or store front to apply for a business credit card, but that simply isn’t true. Anyone who owns a side business – such as baby-sitting, yard maintenance, blogging or consulting – that makes money (or possibly doesn’t even have an income yet) can potentially qualify for a business card.
Here’s what you’ll be asked for when you apply:
- An EIN or SSN
You’ll need to supply your EIN – the number issued by the IRS to people who have a business located in the United States or U.S. territories. If you’re an individual proprietor without an EIN, you can use your Social Security number instead to apply.
- Your business information
You’ll need to supply some basic information about your business: The name of your business (or your personal name, if you’re a freelancer), the type of business (partnership, corporation or sole proprietorship), your role in the business, your business address and phone number, how long you’ve been in business, your number of employees, your annual business revenue and your estimated monthly spend.
- Your personal information
You’ll need to include your personal details on the application as well, including name, address, contact information, Social Security number, birthdate, mother’s maiden name and household income.
- A personal guarantee
Unless you own a substantially sized business (and sometimes even when you do), you’ll probably be asked to make a personal guarantee on your business credit card application, stating that you are personally responsible for repaying your card debt. This means that, if you stop making payments on the card because the business fails, the bank can come after you personally to recover the debt.
Having a well-established business, of course, helps your odds, but you may be able to qualify by just supplying the above information. Here are a few other things you can do to boost your chances of qualifying:
- Pay down debt
Pay down your existing card debt about 30 days before applying for a new card.
- List all of your income
When applying, be sure to list income before taxes, and include income such as pension, alimony and rental income.
- Build up your personal credit score first
Having a good personal credit history is the main factor for getting accepted for a business credit card. If your credit score isn’t good, you need to work on building your personal credit before you apply.
- Be honest on your application
Don’t make up fake revenue for your business hoping to push your application through. If the bank double checks on your application and finds your application isn’t accurate, you could get rejected.
- Start a relationship with the bank
If you already have a relationship with the bank, you have a greater chance of getting accepted for one of their business cards. Start a checking account for your business with the bank and then try applying for one of their cards.
How to choose the best credit card for your business
Credit cards are among the most popular forms of credit for business owners – in fact, it is the most popular among those not applying for a line of credit. Some 44% say they regularly use cards, with the second most common being a loan or line of credit at 38%, according to the Federal Reserve's 2017 Small Business Credit Survey.
There’s no one-size-fits-all business credit card. Business’s credit needs can vary greatly, and business credit cards vary along with those needs. As Ted Rossman points out, "Choosing the right business credit card depends on what you're looking for (cash back, free travel, low interest, etc.). There are lucrative sign-up bonuses to be had, and rewards on spending categories tailored for businesses (such as travel, technology, internet, phone, shipping and online advertising purchases)." Here’s what you need to consider in choosing the best card for your needs:
What types of rewards are you interested in?
The next step is to figure out your preference for rewards. With fiscal year 2019 ahead of you, plan how you'll be spending in the next year. Will you be buying office furniture? What about jumping into online advertising?
- Do you or your employees travel often for business, and are you loyal to a particular airline or hotel? You might consider signing up for a cobranded airline or hotel card, which can be extremely rewarding for dedicated customers.
- Or, if you want more flexible redemption options, you might consider a flexible points card, such as the Chase Ink Business Preferred card.
- If you’re looking for simplicity, a cash back card is probably your best bet – you can redeem your cash back as statement credit or have it deposited into a bank account without having to worry about how to use rewards points.
What types of spending do you do?
Once you’ve settled on the type of rewards that you prefer, you should look at how your business allocates its spending, to decide which card will be most rewarding for you:
How will you pay off the balance?
Consider the amount that you’re likely to charge each month, and whether you’re assured of paying your bill off at the end of the month. If you need the flexibility to make very large purchases, you might choose a charge card, which doesn’t impose a credit limit.
If you’re likely to carry a balance at all, you might want to steer clear of a charge card because you can incur a stiff penalty for not paying off your bill, although American Express now has a program that allows you to pay over time if you qualify. And, if you think you’ll need more flexibility in paying off your balance, you might look for a card with a more flexible deadline.
How to compare two business credit cards
Here, we dive a little deeper, comparing the Capital One Spark Cash with the Chase Ink Business Cash. First, we look at rewards value, then at other features.
Comparing rewards values
Your first step is to calculate the rewards value for the two cards. Basically, you need to estimate how much you’re likely to spend in each of the card’s bonus categories over the year, multiply that amount by the rewards value (don’t forget to figure in the value of points if it’s a points or miles card), add in the sign-up bonus and subtract the annual fee. You should use the following formula:
Rewards value = (Spend in category 1 x Rewards rate x Point value) + (Spend in category 2 x Rewards rate x Point value), etc. + Sign-up bonus - Annual fee
For example, in the following table we calculate the rewards earnings for a cardholder who spends $48,000 on a card in a year, with 6 percent of their spending allocated to office supplies, internet, cable and phone services ($2,880); 12 percent to dining out ($5,280); 11 percent to gas station purchases ($5,760); and 71 percent to other types of purchases ($34,080).
For this particular cardholder, the Capital One Spark Cash card – though it doesn’t offer any bonus categories -- comes out ahead, thanks to its high rate of 2 percent cash back on every purchase:
Rewards value in the first year ($48,000 spend)
Capital One Spark Cash
Chase Ink Business Cash
|2% x $48,000 + $500 sign-up bonus - $0 annual fee (waived first year) = $1,460||(5% x $2,880) + (2% x $5,280) + (2% x $5,760) + (1% x $34,080) + $500 sign-up bonus - $0 annual fee = $1,205.60|
Over the long term, the Capital One Spark Cash card proves to be the better value. Even when we add in the annual fee in the second year, our model cardholder still earns a larger amount of cash back with the Capital One Spark Cash card:
Rewards value in the second year ($48,000 spend)
Capital One Spark Cash
Chase Ink Business Cash
|2% x $48,000 - $95 annual fee = $865||(5% x $2,880) + (2% x $5,280) + (2% x $5,760) + (1% x $34,080) - $0 annual fee = $705.60|
Comparing other features
You should also take a look at the cards’ other features before you decide which one to go with. For instance, you need to consider how easy it is to earn and redeem rewards with the cards.
The Capital One Spark Cash card and the Chase Ink Business Cash card are both simple, flexible cards, but the Capital One Spark Cash card comes out ahead in redemption flexibility. Unlike the Chase Ink Business Cash card, the Capital One Spark Cash card doesn’t set any limits on the cash back that you can earn and there is no minimum threshold to redeem your cash back. You can redeem any amount at any time, and you can even set your account to automatically redeem your cash back, once it reaches a certain amount:
Comparing redemption flexibility
Capital One Spark Cash
Chase Ink Business Cash
- Do awards expire? No
- Redemption options: Cash back, gift cards, donations
- Limits on cash back? No
- Minimum redemption amount: Redeem any amount of cash back at any time (and set thresholds to automatically redeem your cash back)
- Do awards expire? No
- Redemption options: Cash back, travel, gift cards, Amazon points, experiences
- Limits on cash back? $25,000 purchase limit for each bonus category
- Minimum redemption amount: $20
When you look at the cards’ features, you can see that the Chase Ink Business Cash card, while it does have similar account management features to the Capital One Spark Cash card, doesn’t have the same depth of travel and purchase protections. Of course, the Capital One Spark Cash card comes with a $95 annual fee. Basically, you’re paying a premium for all the extra features:
Capital One Spark Cash
Chase Ink Business Cash
- No fee for employee cards
- Quarterly and year-end summaries
- Mobile app sends you alerts and helps you manage spending on the go
- Integrates with QuickBooks, Quicken and Excel
- Discounts on business purchases with Visa SavingsEdge
- No foreign transaction fees
- Purchase protection
- Extended warranty
- Price protection
- Car rental insurance
- Lost luggage reimbursement
- Travel accident insurance
- Travel and emergency assistance
- Roadside dispatch
- VIP access and special events
- Emergency card services
- No fee for employee cards
- Set individual limits on employee cards
- Mobile app sends you alerts and lets you snap and tag receipts on the go
- Purchase protection
- Extended warranty
- Car rental insurance
- Travel and emergency assistance
As you can see from our example, a card with an annual fee can often be a great value, depending on your spending habits and whether you’re likely to use all the features. But who says you have to choose just one business rewards card? Signing up for multiple rewards cards and juggling them to earn extra points in the cards’ bonus categories can be a great way to maximize your rewards.
How to properly use and manage a business credit card
A business credit card can be a powerful tool for increasing your purchasing power and building your business credit history, but it can also come with serious liabilities. Here are some tips to help you avoid the pitfalls:
Read your card’s terms and conditions
Since business cards aren’t regulated by the CARD Act, you should take a close look at your card’s terms and conditions and monitor any changes to terms and conditions that come in your email. Keep an eye out for changes in interest rates, due dates or fees.
Only use your card for business expenses
Don’t put your personal spending on your business credit card. Mingling your expenses makes it harder to track your business spending. Plus, it can make you personally liable if someone sues your company.
Track your spending carefully
Make 2019 the year to get a handle on business expenses. Use your credit card’s expense reporting features to keep close tabs on your spending. Look for opportunities to cut expenses. Keep in mind that business cards come with high credit limits – usually of $50,000 or higher – which makes them ideal for making large purchases. Some cards, such as the American Express SimplyCash Plus card, even allow you to exceed your credit limit when you need to make a large purchase.
Anticipate your cash flow
Figure out ahead of time what your cash flow is going to be through the month. See if you can negotiate your due date with your credit card issuer so that it falls on a date where you will have funds to pay off your balance. Make large purchases right after your statement closes so you have plenty of time to repay the balance.
Make a plan to repay a large purchase ahead of time
Make sure you have a plan in place to repay the amount that you borrow against your credit line, so you can pay it off quickly and avoid high interest fees, penalties or possibly incurring a debt you can’t afford to repay. Avoid carrying a balance past the due date if you can, since the interest can be very costly.
Take advantage of purchase protections
Purchase equipment with your credit card to extend the card’s purchase protections to it. You can possibly save yourself a lot of money if the price goes down, or your equipment malfunctions or gets lost or stolen. You’ll find the usual purchase protections on your business credit card, including insurance against theft and damage for items purchased with your card, extended warranty, price guarantees and the ability to return any item within a designated time frame for a full refund.
Take advantage of business discounts
Many business credit cards include programs – such as VisaSavings Edge, Mastercard Easy Savings and American Express – that give you a small discount with a select list of merchants. The number and variety of merchants varies greatly by program. You can get a significant savings if you happen to shop frequently with a merchant.
Manage employees' cards
Business credit frequently allows you to issue cards from your account to your employees – usually for free, but sometimes for a fee – and to set up individual limits for each card along with account alerts to help you keep a close eye on your employees’ card use. If you or your employees do a lot of traveling for your business, you may be able to make good use of the travel protections that frequently come on business credit cards. Travel protections often include trip cancellation insurance, travel accident trip delay insurance, insurance for lost and delayed baggage and car rental insurance.
Use your account management features
Take advantage of all the features your issuer offers to simplify your account management. Set up automatic alerts for your card and your employees’ cards, set up autopay to make sure you meet your payment due date and link your account to your accounting software so you can easily download all your expenses. Most business credit cards come with expense-tracking features, such as apps that allow you to snap photos of your receipts and file them on the go, spending reports, yearly summaries and the ability to designate an account manager to manage it all for you.
Deduct interest from your taxes
If you do happen to incur interest from carrying a balance on a business credit card, be sure to note it on your tax form – it counts as a business expense.
How to maximize credit card rewards for your business
- Use credit cards for most of your business purchases
Leverage your business purchasing to earn rewards for yourself. Link all your bills to your credit card account (but first make sure they don’t charge finance fees). Also, keep an eye for purchases that can earn extra rewards in a bonus category, such as dining or office supplies.
- Give cards to your employees
Instead of reimbursing your employees for their purchases, give them employee cards through your account and encourage them to use them for every business-related purchase so you can earn the rewards from their purchases. However, establish clear rules on how employees can use their cards.
- Juggle rewards cards
Rotate your credit cards so that you can earn extra rewards in all their bonus categories.
- Keep a close eye on deadlines and fees
Make sure to pay your bill in full and on time, so that interest rates and penalties don’t eat into your profits or nullify your rewards.
- Never carry a balance
Business rewards cards tend to carry high interest rates, so you need to especially careful not to carry a balance.
- Use shopping portals to stack rewards
You can use online shopping portals such as Ebates and Swagbucks to earn extra cash back on top of your card rewards. You can also earn bonus rewards by through an issuer’s shopping portal, such as the Chase Ultimate Rewards mall.
- Get bonus points through a program partner
Some business rewards cards let you earn bonus points through partner merchants or travel partners. For instance, through the American Express program, you can opt to earn a 5 percent discount or 2 points per dollar on purchases made from a select list of merchants. Also, the Starwood Preferred Guest program has a few travel partners that offer bonus Starpoints to elite SPG members.
- Keep track of spending categories and payment due dates
Adding sticky notes to your cards to keep track of their spending categories, and using spreadsheets to track your payment deadlines and progress on spending thresholds can keep a lot of rewards value from falling through the cracks. Or download an app that tracks all this information for you.
How do you build business credit?
To build a credit history for your business, you need to establish that your business is a separate entity from yourself and take steps to make sure that your business’ spending activity is being tracked by business credit bureaus. Here are some steps you can take to create a credit history for your business:
Start a business checking account
A checking account will help you establish your business as a financial entity. Be sure to use it responsibly – keep an adequate balance in it and don’t bounce checks.
Make sure your business is on the credit reporting radar
Register for a DUN number through Dun and Bradstreet to establish a credit history with them. For Experian and Equifax, establish a LLC so you can get an EIN and set up a phone line with a listed number.
Use D&B Credit Builder
If some of your vendor accounts are not making it onto your credit report, you can use D&B’s Credit Builder service to provide positive payment information to your credit report. You can provide D&B with your vendors contact information, then D&B will contact them to verify your payment history.
Strengthen your personal credit history
Unlikely though it may seem, building your personal credit score is one of the first steps to building a credit history for your business. A good personal credit score can help you acquire your first lines of business credit. Also, your personal credit history will likely be considered down the line along with your business credit history when you apply for additional loans.
Apply for a small business credit card
Before you’ve built up your business credit history, you can use your personal credit history to qualify for a business credit card. Your activity on the card should be reported to all the business credit bureaus. Use it often and be sure to pay your bill on time and in full each month.
Make your payments on time
Consistent and prompt payments are the single most-critical factor in a business credit report. Diligently paying all your accounts on time will go a long way toward demonstrating your ability to manage loans.
Streamline your invoicing
To make sure you can make your own payments on time (and minimize your need for cash flow), make sure your own customers paying you in a timely manner. Send out your invoices as soon as a service is performed and encourage your customers to pay on time.
Use business credit instead of personal credit when you can
Shift your spending to your business accounts and pay off your balance in time to strengthen your company’s credit report.
Ask for a credit line increase
Request credit line increases on your existing accounts – this will improve your credit-to-debt ratio and thus your overall credit score.
What is a good credit rating for a business?
Credit scoring for businesses is a bit different (and more complicated) than scoring for consumers. Personal FICO scores range from 300 to 850 while business credit scores use different scales. There are three primary business credit score bureaus and they all structure their ratings differently.
You can find your business credit score by visiting the Dun & Bradstreet, Equifax and Experian websites. You can check your business credit history at no cost, but you will have to pay a fee to see your credit scores. Here's how the 3 business credit bureaus score:
Dun & Bradstreet offers three scores in its credit report:
- Paydex score – An indicator of the timeliness of your payments. The score ranges from zero to 100. A score above 80 indicates payments made within terms.
- Commercial credit score – Shows the likelihood of a severe delinquency on your bills in the next year. The score ranges from 101 to 670, with a lower score representing a higher probability of a delinquency. A score above 450 is good and above 482 is excellent.
- Financial stress score – Predicts the likelihood of your business failing within the next year. The score ranges from A score above 1509 is good and above 1570 is excellent.
Equifax offers four scores in its credit report:
- Credit information – Measures your delinquency risk based on positive and negative information in your credit file. The score ranges from 20 to 70, with lower scores being better.
- Payment index – Shows the timeliness of your payments to vendors and creditors. The score ranges from zero to 99. A score lower than 30 (i.e., your payments are usually made in the first 30 days) is best.
- Commercial delinquency score – Shows the likelihood of a severe delinquency on your bills in the next year. The score ranges from 101 to 992. A higher score is better.
- Business failure score – Predicts the likelihood of your business failing in the next year. The score ranges from 1,000 to 1,610. A higher score is better.
Experian offers a single score in its credit report:
- Business credit score – A comprehensive rating of your creditworthiness, based on your credit history, including balances and outstanding loans, payment habits, whether you have any liens against you, judgments or bankruptcies against your business and the size and age of your business. The score ranges from zero to 100. A score higher than 50 is good.
Heads up that business credit cards typically aren’t recorded on your personal credit report unless your account becomes seriously delinquent – but it depends on the issuer. Capital One, for instance, does report all the activity on your business cards to consumer credit bureaus, but Bank of America does not.
A business credit card can substantially boost your business credit history. By putting small charges on your card each month and paying them off, you can create a record of timely payments for your business. Keep in mind that if your business fails and you end up with a credit card balance you can’t pay off, you might be personally responsible for paying your business credit card off.
Note, if you are intending to apply for a business credit card, you’ll also need to look at your personal FICO score, since card issuers use your personal credit history to determine your credit worthiness. A FICO score of 700 is considered good, while 750 and above is considered excellent.
Business credit cards vs. business charge cards
Business credit cards and business charge cards are very similar to one another – you can use either type of card to make purchases against a line of credit, which has to be paid either partially or in full by the end of the month, depending on the type of card. Here are key differences between the two:
- Credit cards have a preset spending limit, which you are not allowed to go over without being penalized or having your card declined.
- Charge cards don’t have a preset spending limit. This gives businesses the flexibility to make a large purchase without having to request a credit increase. (Issuers may still impose an overall cap on how much you spend, however.)
- Credit cards allow you to carry a balance month to month. You are charged interest on your balance if you don’t pay it in full starting from the end of your grace period, and you could owe a penalty if you don’t make a minimum payment on your balance.
- Charge cards penalize you if you don’t pay your balance in full at the end of the month. You will be penalized sharply if you don’t pay off the bill on your charge card at the end of the month – around 3 percent of total balance. Also, your issuer may suspend your credit.
A charge card may be the better way to go for your business, since they offer more spending flexibility and they have less impact on your credit score, because there isn’t a debt-to-credit ratio. However, they can also be more difficult to qualify for. A business credit card may be the better option if you need a card with a lower barrier to entry and also if there’s a possibility you might carry a balance from month to month.
Major business programs
Whether you are on the watch for business loans or travel business cards, the major banks' business programs are worth a look.
Chase features one of the most robust arrays of business products through its cards, loans, banking, and merchant services.
The 3 Chase Ink cards are the stars of the Chase business products, with bonus points or cash back and rich ongoing rewards. Rewards can be used toward cash back, travel, gift cards, and so on. There are also partner small-business cards with Southwest, United and Marriott, all with bonuses and ongoing points or miles. Those include boosted rewards for loyalty, such as 6X points on Marriott purchases, and Southwest Rapid Rewards Premier Business Credit Card offers 6,000 points every anniversary.
Also offered are checking, merchant services and business lending. Available products, depending on your area, include Chase Total, Chase Performance and Chase Platinum. You can earn $200 back with qualifying activities. Not only does Chase make sure you can accept payments online, through mobile and everything in between, but the bank also offers the latest in security. Business lending offerings include business lines of credit, business term loans, SBA financing, commercial real estate financing and equipment financing.
Small business and corporate cards abound with this brand, allowing you to earn rewards both from your own expenses and those of your employees. Manage expenses with Spend Manager and sync transactions with Connect to QuickBooks.
There are also funding opportunities for cardmembers and merchants that accept the cards. For example, get merchant financing with fixed-fee, no-interest loans with funding up to $2 million. You can also request funding to pay vendors through Working Capital Terms, and get approved for collateral-free funding within minutes at fixed rates for up to $50,000.
The small business options are endless with Capital One. There's Business Unlimited or basic checking, with up to a $1,000 bonus, and merchants can save up to 0.15% on processing fees. You can also get 1.75% APY for 12 months on Business Advantage Savings and up to $7,500 off closing costs on your commercial real estate loan (promotional rate will expire 365 days after account opening; upon expiration, standard interest rate in effect as of that date will apply to the entire balance). There's also Escrow Express, 401(k) solutions for your business and, of course, cards.
The Spark cards offer a host of travel and purchase benefits, including purchase security; extended protection; save up to 15% at participating merchants through Visa SavingsEdge; travel and emergency assistance; and auto rental collision damage waiver. Also get a quarterly and year-end summary; employee cards at no additional cost; downloadable purchase records; and no foreign transaction fees.
Bank of America Business Advantage
Business Advantage offers a plethora of business tools and options, including checking; credit cards; merchant services; and Merrill Edge for business and personal retirement planning.
There are 5 business credit cards with this bank, including 3 travel business cards and a cash rewards card. You can earn a statement credit, cash back, points, or get a rock bottom variable APR for your balance transfers. For example, the Business Advantage Cash Rewards Mastercard offers 3% back on gas stations and office supply stores (up to $250,000 each calendar year), and the Business Advantage Travel Rewards Mastercard offers 25,000 bonus points (when you spend $1,000 in net purchases within 60 days of your account opening).
BofA offers merchant services by partnering with the Clover suite of point-of-sales devices. A wide variety of Clover point of sale products are available, such as Clover Go for food trucks, farmer's markets and other businesses without a storefront, or Clover Station for merchants who need business management solutions in addition to payment processing such as restaurants and retail.
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