Table of Contents
- 1 FULL LIST OF EDITORIAL PICKS: BEST SMALL BUSINESS CREDIT CARDS
- 2 OTHER RESOURCES
- 3 Can you apply for a small-business credit card?
- 4 Understanding small-business credit cards
- 5 Business credit scores vs. personal credit scores
- 6 How to choose a small business credit card
- 7 How to compare small-business credit cards
- 8 Getting the most out of your small business card
FULL LIST OF EDITORIAL PICKS:
BEST SMALL BUSINESS CREDIT CARDS
Click the card name to read our review. Before applying, confirm details on the issuer’s website.
Our pick for: Cash back — flat-rate rewards
The Capital One® Spark® Cash for Business is an excellent option for business operators whose expenses are all over the map and don’t fall into the bonus categories on other business credit cards. You get a high, flat rewards rate on every purchase, with no limit to how much you can earn. There’s a great sign-up bonus offer, too. Read our review.
Our pick for: Cash back — bonus categories
If your business’s spending matches the bonus categories on the Ink Business Cash℠ Credit Card, you can rack up some serious cash back. (If not, then look elsewhere.) There’s an excellent sign-up bonus for a no-annual-fee cash-back card, plus an introductory 0% APR period for purchases. Read our review.
Our pick for: Cash back — flat-rate rewards + no annual fee
The no-fuss, no-hassle rewards of the Discover it® Business Card make it a great choice for entrepreneurs and side hustlers whose business expenses don’t fall into the bonus categories on other small-business rewards cards (things like office supplies, advertising and so on). You also get Discover’s signature “cash-back match” bonus your first year. Read our review.
Our pick for: Travel rewards — bonus categories + big sign-up offer
The Ink Business Preferred® Credit Card starts you off with one of the biggest sign-up bonuses of any credit card anywhere (assuming you spend enough to earn it), then gives you bonus rewards in common business spending categories. Points are worth 25% more when redeemed for travel booked through Chase, or you can transfer them to about a dozen airline and hotel partners. Read our review.
Travel rewards — flat-rate rewards
The Capital One® Spark® Miles for Business is basically a business version of the popular Capital One® Venture® Rewards Credit Card. You earn 2 miles per dollar on all purchases, and miles can be redeemed at a value of 1 cent apiece for any travel purchase, without the blackout dates and other restrictions of branded hotel and airline cards. The card offers a great sign-up bonus, too. Read our review.
Our pick for: Travel rewards — premium rewards and perks
Like the consumer version of this card, The Business Platinum Card® from American Express comes with a big annual fee. But business travelers who prefer to go in style will find plenty that appeals to them: high rewards on certain travel purchases, bonus rewards on larger non-travel purchases, a superb newcomer bonus offer, extensive airport lounge access, elite hotel status, hundreds of dollars a year in available credits and a list of perks as long as your arm. It’s not cheap, but luxury never is. Read our review.
Our pick for: Travel rewards — no annual fee
This is the business version of the issuer’s excellent no-annual-fee travel card. The Bank of America® Business Advantage Travel Rewards World Mastercard® credit card pays solid rewards on every purchase and gives you wide flexibility in redeeming your points for any travel purchase, without the restrictions of branded airline and hotel cards. Read our review.
Our pick for: 0% intro APR + AmEx points
The Blue Business® Plus Credit Card from American Express is a near-twin to the American Express Blue Business Cash™ Card, with one key difference: Rather than cash back, it pays you in AmEx Membership Rewards points. Read our review.
0% intro APR + cash-back rewards
The American Express Blue Business Cash™ Card boasts one of the better 0% introductory APR offers among business credit cards. Beyond that, you earn a solid cash-back rate (at least for a while — the rate drops after you hit a spending threshold). There’s no annual fee, but there’s no new-cardholder bonus offer either. Read our review.
Our pick for: Flexible financing
Businesses with high working capital needs but sometimes inconsistent cash flow might find The Plum Card® from American Express a perfect fit. Pay early and get a discount, or enjoy up to 60 days interest-free. There’s a substantial annual fee, but if you’re using the card for, say, big inventory purchases, the benefits could far outweigh the costs. Read our review.
Our pick for: Airline credit card for business
If your business has you on the road a lot, you’ll appreciate the airport lounge access on the Delta SkyMiles® Reserve Business American Express Card, which includes both Delta’s own Sky Clubs and American Express’s Centurion Lounges when flying Delta. The annual companion certificate — which is good even in first class — and the checked-bag benefit add considerable value, too. Read our review.
Our pick for: Hotel credit card for business
The Marriott Bonvoy Business™ American Express® Card can pay for itself just with the automatic free night’s stay every year. Add in automatic elite status, generous rewards, a dandy sign-up bonus and more, and it’s hard to go wrong. Read our review.
Our pick for: Fair credit
The rewards rate on the Capital One® Spark® Classic for Business isn’t going to wow anyone, there’s no sign-up bonus and the APR is high. What makes this card valuable is that it’s available to business operators with fair or “average” credit, who don’t have a lot of options in business credit cards — especially with no annual fee. Read our review.
Our pick for: No personal guarantee
Unlike most cards designed for entrepreneurs, the Brex Card for Startups doesn’t require the cardholder to personally guarantee the debt on the card. Instead, Brex determines creditworthiness by evaluating a company’s cash balance, spending patterns and investors. It’s a good option when a business owner has a thin credit file but is well-capitalized. The card earns rewards, too. Read our review.
Can you apply for a small-business credit card?
The term “small business” is often associated with enterprises like a corner store, an accountant’s office or a landscaping company. But small-business cards can make sense for anyone who is in business for him- or herself, whether it’s a full-time job, freelancing, gig work or a side hustle.
You don’t need to be incorporated or have a formal business structure, like an LLC or partnership. Most entrepreneurs are “sole proprietors” — sole proprietorships account for about three-quarters of all businesses in the U.S. — and they’re eligible to apply for small-business credit cards.
Why get a small-business credit card? Small-business cards help you keep business and personal finances separate. When you use the card only for business spending, interest and fees on the card can be tax-deductible business expenses. And small-business cards offer rewards, perks and bonuses that rival (and in many cases surpass) those on consumer credit cards.
What the application asks for
Applications for small-business credit cards are a lot like those for consumer cards, with a few important differences. The application may ask for:
A business name. If you don’t have a formal business name, this can just be your name. When you’re a sole proprietor, you literally are the business.
Business contact information. If you don’t have a separate business address and phone number, don’t sweat it. Your personal address and phone number are just fine.
A federal Taxpayer Identification Number. Don’t get intimidated by this term. Your Social Security number is a federal tax ID number, and if you’re a sole proprietor, you can put that down. If you have employees or a formal business structure, you’ll probably have an Employer Identification Number, and you can use that.
The industry you’re in. What do you do in your business? This can be a broad category like retail, medical or professional services, or something more specific. If you’re stumped for the proper way to describe it, think about the service you provide. Drive for Uber? That’s transportation. DoorDash or Grubhub? That’s delivery.
How long you’ve been in business.
Revenue and expenses. Revenue is simply how much money you brought in from your business. Expenses are all the money you spent in to earn that money.
What you do NOT need
A formal business structure. The application will ask you to specify what kind of business it is. If your business is organized as a corporation, partnership or LLC, put that down. If you operate without a formal or legal business structure, that’s fine, too. You can put down “sole proprietor.”
An existing business credit history. Although businesses can have credit histories and credit scores of their own (more on that below), a separate business credit file isn’t necessary to qualify for a small-business credit cards. That’s because most cards require you to personally guarantee the debts of the business (also discussed below). In other words, you qualify for a small-business credit card based on your personal credit history and credit scores.
Understanding small-business credit cards
Business and consumer credit cards differ in a few critical ways. Here’s what you should know before applying.
You’ll have to sign a personal guarantee
Virtually all small-business credit card applications include personal guarantees, where you agree to be personally liable for the debt accrued. This means you’re responsible for the balances even if your business goes belly-up. Keep this in mind when applying and avoid borrowing more than you’re able to pay back.
Your personal credit may be affected
When you apply for a small business credit card, the application will probably show up as an inquiry on your personal credit report, which can cost you a few points on your credit scores for a short time. That’s because your issuer wants to make sure that you, the business owner, are personally on solid financial footing before letting you borrow money.
After that, small business cards generally fall into two categories: some report your account payment history only to commercial credit bureaus, while others report to both consumer and commercial bureaus. In the latter case, your good or bad spending habits on your small business credit card could affect both your personal and business credit.
They generally aren’t covered by consumer protection laws
As a courtesy, issuers today generally extend many consumer protections for personal credit cards to small-business credit cards. But the law doesn’t require them to do so. The consumer-friendly Credit Card Act of 2009 set important limits on fees, interest calculations and disclosures for personal credit cards, but it doesn’t cover small-business credit cards.
Small business cards aren’t corporate cards
There are two types of business credit cards: small-business cards and corporate cards. If you’re just starting out and your revenue is in the thousands, not the millions, you’ll likely want to go with a small business credit card, the kind featured on this list. Once you hit the big time, you might want to switch over to a corporate card. This would limit your personal financial liability for the account.
Business credit scores vs. personal credit scores
Businesses can have credit scores just like individuals. When you’re just getting a business off the ground, you’ll probably have to rely on your personal credit to open a small-business credit card or obtain a loan. But as a business builds its credit over time, it becomes easier to secure financing separate from the owner’s personal credit, as well as qualify for a business insurance policy.
Below are key differences between business credit scores and personal credit scores.
Like consumer credit scores, business scores are generated by credit reporting bureaus — companies that collect information about debts and then use that information to estimate how risky it would be to lend money to a person or, in this case, a business. The higher the score, the lower the risk.
The main consumer credit reporting bureaus are Equifax, Experian and TransUnion. The main bureaus for business scores are Dun & Bradstreet, Equifax and Experian.
Consumer credit scoring systems typically have a score range of 300 to 850. The range for business scores is usually 0 to 100.
Consumer credit bureaus collect information independently from each other, but they use similar algorithms to calculate scores. As a result, your personal scores are likely to be similar, even if not identical, from one bureau to the next. Business credit score algorithms don’t follow an industry standard and can vary from bureau to bureau.
Federal law gives you the right to a free copy of your personal credit report from each of the three major consumer credit bureaus once every 12 months. Further, you can get free access to your personal credit score in a number of ways (including from NerdWallet). Not so for business credit. You’ll have to pay to see your company’s credit report and score at the major business credit bureaus.
Only you and certain companies have the right to see your personal credit reports and scores. But with business credit reports, all information is public, and you can get information on other companies as long as you’re willing to pay for it.
How to choose a small business credit card
Chances are, you’ll use your small-business credit card quite a bit, so make sure you’re getting one with favorable terms. Here’s how:
Take stock of your business’s spending habits
If you plan on carrying balances from month to month, getting a card with a 0% APR period or low ongoing interest is more important than searching for generous rewards. Alternatively, if you plan on paying in full every month, a card with a big sign-up bonus and lucrative rewards could be a perfect fit.
Figure out what type of rewards you should go for
If earning big rewards is your goal, start by looking at your costs. For businesses that spend plenty on travel and office supplies, a card that gives bonus rewards in those categories would be an excellent choice. And for companies with spending that doesn’t fit into the usual categories, a flat-rate rewards card would fit the bill.
» Confused about miles and points programs? See what these rewards are worth and read about how these programs work with our guide to travel rewards programs.
Look for business-friendly benefits
Some cards come with programs that allow you to match photos of receipts to your card purchases in-app. Many also offer free employee cards and itemized end-of-year statements that help at tax time.
How to compare small-business credit cards
As you narrow down your choices based on your business’s needs, here’s how to evaluate and compare the features of different cards.
Many of the best small-business credit cards charge an annual fee, often in the $100 range. The rewards you earn from your spending can easily make up for it, so don’t dismiss the idea of paying a fee out of hand. High-volume businesses, especially, can earn rewards that dwarf the fee. If you spend $200,000 a year on a card with a 2% rewards rate, for example, that’s $4,000 a year in rewards, well worth a $100 fee. Annual fees are also deductible business expenses. Still, if you’re 100% opposed to paying a fee, there are fine no-fee options available.
If you opt for a rewards credit card, you’ll have two choices to make. The first is whether you want a flat-rate card or a bonus-category card:
Flat-rate cards pay you the same rewards on every purchase, regardless of what you buy or where. If you want simplicity, or if your business’s expenses tend to run the gamut without any particular category predominating, then a flat-rate card may be best for you.
Bonus-category cards pay a higher rewards rate in certain categories and a lower base rate on everything else. If you don’t mind (or if you enjoy) keeping track of categories and moving spending around to maximize your return, then these cards may be right for you. A bonus category card is an excellent choice if you spend a lot of money in just a few areas. Typical bonus categories for business credit cards include things like office supplies, travel, telecommunications, advertising and shipping.
The second choice is whether you want your rewards as cash back or points.
Cash-back cards pay you back a certain percentage of every purchase. Flat-rate cards tend to offer 1% to 2% back — spend $1,000 on something, get $10 to $20 back. Bonus-category cards go as high as 5%. Cash back is most commonly redeemed as a credit against your account.
Points cards give you points or miles for each dollar you spend, either at a flat rate or with bonus points in certain categories. These rewards can usually be redeemed for travel, though you may have other options, such as merchandise or cash back.
Introductory APR period
A number of cards offer a lower interest rate, often 0%, when you first open the account. The 0% period may last a year or more. This can be of great benefit if you have a major business-related purchase you’re looking to finance.
If you plan to pay your credit card bill in full each month, then the ongoing APR doesn’t have to be a major factor in your decision. That’s because you’ll pay no interest. But if you expect to carry a balance from month to month, the ongoing interest rate becomes very important. Interest charges can easily eat up the value of your rewards, so prioritize a lower ongoing APR if you’re going to be carrying debt.
Some small-business credit cards offer special financing options, such as a discount if you pay early or the ability to set up installment plans to pay off specific charges. These can be useful if your business is seasonal or subject to irregular cash flow.
Free cards for employees
If you’re earning rewards, you’ll want to get as much company spending on the card as possible. Many issuers allow you to get additional cards at no extra cost for employees who are authorized to spend money on behalf of the business. You also may be able to set spending limits or other restrictions on employee cards.
Expense management tools
It’s helpful if the issuer offers tools to help you track and categorize expenses. For example, you may be able to download transaction data into bookkeeping software. Or you could match photos of receipts to transactions. Or you may get a detailed annual report for use in preparing your taxes.
If your business has you traveling a lot, look for a card that can make your trip more comfortable. Co-branded airline and hotel cards offer special status and upgrades. Some cards give you access to airport lounges. Others provide travel insurance or rental car coverage for peace of mind.
Getting the most out of your small business card
Pay with your credit card whenever possible
For entrepreneurs who pay in full every month and don’t overspend, using a rewards credit card for everything makes those points, miles or cash back add up fast. Avoid paying with a credit card when a convenience charge is added, if possible.
Lock down that sign-up bonus
To get your card’s sign-up bonus, you typically need to make a few thousand dollars’ worth of purchases in the first few months after opening the account. Check your card’s terms and track your spending to make sure you don’t miss out.
Know when your introductory 0% APR ends
Deduct interest and fees on your taxes
If you’re using your card for business costs, fees and interest count as business expenses. That means you can deduct them at tax time.
To view rates and fees of the The Business Platinum Card® from American Express, please visit this page.
To view rates and fees of the The Blue Business® Plus Credit Card from American Express, please visit this page.
To view rates and fees of the American Express Blue Business Cash™ Card, please visit this page.
To view rates and fees of the The Plum Card® from American Express, please visit this page.