Your Business Credit

Can two business partners get a joint business credit card?

It’s possible, but getting your own cards separately or relying on cash flow instead of credit are better options


When you get a business credit card for a small business, you must generally provide a personal guarantee. If your business partner applies for a credit card but does not have good credit, it is possible this will result in a lower interest rate for both of you – or could get you both denied.

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Dear Your Business Credit,

As an LLC, I have a business partner. We want to get a business credit card. Can it be in both of our names so that we share the debt responsibilities? I have very good credit and she does not. I am trying to figure out how this would work because I do not want to be solely responsible for the debt that would be incurred with the start of the business. – Cindy

Dear Cindy,

It is possible to apply for a joint credit card. However, I don’t think getting a business credit card together is a good idea. Here is why.

When you get a business credit card for a small business, you must generally provide a personal guarantee. If your business partner applies for a credit card but does not have good credit, it is possible this will result in a higher interest rate for both of you, or could get you both denied.

Check out all the answers from our credit card experts.

Ask Elaine a question.

Beyond that, even if she qualifies and guarantees the debt along with you, that guarantee may not be worth much in the end if her compromised credit is a result of a habit of not paying her bills or paying them late.

I think you need to find another solution. You don’t seem to feel fully comfortable in taking on debt with her, and I would trust that gut instinct. We have our intuition for a reason.

That doesn’t mean you can’t do any borrowing for the business. I would recommend that you each apply separately for your own business credit cards and then alternate in charging business expenses, so you each carry about the same balance. Pay off the debts at the same pace, as well.

See related:  Opening a business with a romantic partner: Should you get a joint credit card?

Are you willing to take sole responsibility for your company’s debt?

What if your business partner isn’t in a position to qualify for credit? If you are not willing to take on all of the responsibility for all the debt of the business, I’d recommend that you find another way to pay for business expenses, such as paying for them through cash flow and growing the business more slowly.

You might also set aside a few months for your business partner to work on improving her credit by paying down bills and reducing her total credit utilization. This will improve her credit profile.

If she has the discipline to improve her credit score successfully, that will be a good sign for your financial partnership and will help you build confidence that she will be a good partner in paying back any debt the business incurs.

What if she is not able to do this? Then I would not recommend taking on any debt together. There may be some reason she cannot take on the responsibility of borrowing. Regardless of what that reason is, if she does not pay her debts or cannot pay them on time, it doesn’t portend well for her future behavior.

You may have to have some uncomfortable conversations to discuss this but it is better to be open now than have regrets later. Good luck.

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