How To Choose The Best Business Credit Cards
Updated On January 13, 2022
Editorial Note: This content is based solely on the author's opinions and is not provided, approved, endorsed or reviewed by any financial institution or partner.
If you are a business owner, then the best business credit cards are a must-have for your business whether you own a large, medium or small business. Businesses need credit and having the best business credit cards are essential to help fund your business, save cash and earn great rewards in the process. If you want to know how to choose the best business credit cards, remember this: finding the best business credit cards can be easy if you know what to look for.
This best business credit cards guide will teach you everything you need to know about small business credit cards and the best business credit card offers. As we do with the best rewards credit cards, best 0% APR credit cards and best cash back credit cards, we break down all our best picks for the best small business credit card and more in this guide.
Business credit cards are credit cards that give you and your business great cash back rewards and travel rewards based on your credit card spending. For every dollar you spend on the top business credit cards, you will receive cash back. The amount of cash back you receive with the best small business credit card will vary based on the credit card you choose. Typically, with the best business credit cards, you will find that you typically can earn 1.0% to 1.5% business on your credit card spending.
Best Business Credit Cards: Can I get a small business credit card?
If you have a small business, a freelance gig, a consultancy, or even a side hustle, you can benefit from a small business credit card. It’s important to keep your personal expenses and business expenses separate from each other to keep you organized at tax time. The best small business credit cards offer cash back and bonus rewards for airlines, gas, office supplies and other categories.
With the best business credit cards, it is essential that you repay your credit card balance each month in full. Why? If you do not repay your credit card balance in full, you will be charged interest, which can cost you more than the value of your business rewards. This is particularly important for small business owners because otherwise interest charges will hurt profits.
The best place to start is your spending, particularly the categories where you spend most frequently. Then, you can align your spending habits with the business credit card offers that best match your spending. The best business credit cards offer business in several popular categories such as travel, airlines, hotels, office supplies, advertising, entertainment and other spending, among others.
Best Small Business Credit Cards: What is the purpose of a small business credit card?
The best business credit cards are for managing your expenses, earning great cash back and travel rewards, and separating your personal expenses from your business expenses. The best small business credit cards should not really be used to finance purchases. Why? The interest rates you would pay would be expensive. If you need to finance purchases, then your best bet is a 0% APR credit card.
So, it’s to your advantage to use a small business credit card to earn rewards for every dollar you spend. In some cases, the best business credit cards help you earn more rewards in certain spending categories. With cash back rewards, you can apply the cash you earn to pay off your business credit card bill or use the cash in other ways to help grow your business and increase your bottom line.
Best Business Credit Cards: How should I choose the best business credit cards?
There are several factors to consider when you choose the best business credit card:
When you choose the best small business credit card, the cash back rewards rate often is your top consideration. The best business credit cards typically have a business rewards rate of 1.0% to 1.5% to 2% for flat percentage cash back rewards. For rotating spending categories or tiered spending categories, the rewards rate can have a higher percentage.
If your small business credit card has any annual limits on the amount of cash back you can earn, and you plan to exceed that limit in a single year, then you can use another business credit card to earn more cash rewards. So, you can be strategic about how you use the best small business credit cards and choose more than one business credit card to help you earn more cash back.
The sign-up bonus is your second major consideration when you choose the best small business card. A sign-up bonus is important because you can apply the cash bonus or rewards bonus directly to your business, which saves you money.
Some of the best small business credit cards charge an annual fee, while others do not. There are several factors that determine the annual fee, but typically business credit card offers with annual fees are because the credit card rewards are higher.
When it comes to the best business credit cards, earning cash back and travel rewards and redeeming cash back rewards back and travel rewards are both important. Therefore, choose a small business credit card for which you can redeem rewards easily.
Introductory APR / Final APR
If you plan to repay your credit card balance in full each month, then the APR is less important. Instead, focus on the percentage cash back, the sign-up bonus and other perks when you choose the best business credit card. A low introductory APR can also work to your advantage if you plan to make a big purchase and pay off your credit card balance in full.
Best Business Credit Cards: How to get approved for the best business cards
To get approved for the best business cards, you need to have strong credit or excellent credit. The stronger your credit, the higher likelihood that you will be approved for best business credit cards.
To get approved for the best 10 business credit cards, credit card companies will evaluate your credit profile, income, other debt and your history of financial responsibility. Credit card companies offer the best business credit cards to customers have a history of financial responsibility who they can trust to repay their credit card balances in full.
If you have a strong financial profile, you may be a great candidate to qualify for the best business cards.
Best Business Credit Cards: How to choose the best business credit cards
The best business credit card is the one that will give you the most rewards based on your spending.
When you want to choose the best small business credit card, you need to evaluate your specific spending. Once you analyze your spending, you can determine in which category you spend the most. For example, if you find that you spend the most for travel, you can pick the 3 best small business credit cards that have the highest business cash back for travel spend. This allows you to match your spending with the highest cash back rewards.
The best small business credit card will always be specific to you and your spending. Therefore, it is important to understand whether the business credit cards have fixed rewards or rotating business rewards.
You can compare the best business cards on Mentor Money to determine which categories match your spending habits. With rotating business rewards, the categories with the highest business rewards may change throughout the year. With the best business credit cards, try to time your purchases to match the rotating categories.
Best Business Credit Cards: The best ways to redeem cash with the best business credit cards
With the best business credit cards, you can typically redeem rewards in one of the following three ways:
1. Bank deposit:
With this redemption option, you receive your cash directly into your bank account. For the best small business credit cards, this is your top strategy to get cash back, which you can use to help your business.
2. Statement Credit:
This business redemption option puts the cash you earn directly on your credit card statement. The best business credit cards offer this redemption option. The good news is it usually appears within your statement within days.
3. Gift Cards:
Small business credit cards also provide an option for you to receive a gift card with your cash balance.
When it comes to travel rewards, you can redeem your points and miles for great airline, hotel and other travel rewards.
When looking for the best business rewards credit card, make sure that you can redeem business in the way you prefer. When it comes to the best business credit cards, also be sure to read the fine print. If you look at the best business credit cards that are most popular, each of them may have different redemption options. So, make sure you understand if there are any limits.
What’s the best way to use a small business credit card?
The best way to use a small business credit is for everyday business expenses and business expense tracking. You can use your small business credit card for everything from travel to office supplies. Plus, it’s smart to separate your business expenses from your personal expenses.
Also, remember to pay off your balance each month. The last thing you want to do with a small business credit card is keep a balance because you will have to pay significant interest, which can hurt your business profits. Therefore, you should only use the best business credit cards for expenses that you can pay off each month.
Best Credit Cards: Are there small business credit cards with no personal liability?
No, there are no small business credit cards in which the business owner does not have personal liability. Credit card issuers will hold the business owner personally responsible for unpaid expenses on your small business credit card. When you apply for the best business credit cards, you provide your social security number.
Best Small Business Credit Cards: How do I build credit for my business?
Building credit for your business is a top priority. When you build credit, your business can increase its professional reputation, get access to credit such as loans and get preferable borrowing rates. This can help you grow your business and save money.
When you apply for the best business credit cards, your personal credit history is what matters more. Credit card issuers prefer personal history because your personal credit profile will be longer than your business credit profile. So, if you have a strong credit score, you should aim to get the best small business credit card that you can based on your credit profile.
To build credit with your business, it’s the same process as building your personal credit score. Therefore, paying your credit card balance in full each month, not skipping payments and avoiding late payments all help increase your credit score. Since your business credit is an extension of your personal credit, you should focus on building credit for yourself and your business.
Here are some more ways to build credit for your business:
- Start a business checking account.
- Improve your personal credit history.
- Apply for the best small business credit cards.
- Always pay your credit card balance in full.
Ask for a credit increase for your small business credit cards.
How do I find my business credit score?
Your business credit score is available for a fee from the following companies: Dun & Bradstreet, Equifax and Experian. Dun & Bradstreet has a free service called CreditSignal, which gives you alerts when your business credit score or credit reports change. However, to access your business credit report, you have to pay a fee.
Should I get a small business credit card or a small business loan?
The easy answer is that you can get both a small business credit card and a small business loan. You should evaluate your business needs and understand that a small business credit card and small business loan can be used for different purposes. With a small business credit card, you only use what you need. With a small business loan, you may need to borrow more money than you need and pay interest. In contrast, so long as you pay your credit card balance in full each month, there is no interest charge. Plus, it’s typically easier to be approved for the best business credit cards than it is for a small business loan.
What is the best way to manage the best business credit cards?
When it comes to the best business credit cards, you can gain access to credit and grow your business. To ensure that you maximize the benefits of small business credit cards, here are the most important things to do:
1. Review and monitor your credit card’s terms and conditions.
Business credit cards are not regulated by the CARD Act, so make sure to monitor interest rates, terms, payment dates and more.
2. Monitor employees.
Make sure that you only give small business credit cards to trusted employees and monitor their purchasing.
3. Always pay the balance in full.
Like personal credit cards, the best small business credit cards come with high interest rates. To avoid these unnecessary costs, make sure to pay your balance in full.
4. Track your spending.
This is a no-brainer but be sure that you monitor your monthly spending to manage your expenses.
5. Deduct interest on your taxes.
Remember, if you do not pay your balance in full each month, you will owe interest on your credit card balance. You can deduct this interest on your taxes.
How do you apply for the best business credit cards?
If you want to know how to apply for the best business cards, the process is easy. You can apply online and here’s what you will need:
1. Business Overview
A description of your business, the contact information, type of business (partnership, corporation, sole proprietorship), how long you have been business, number of employees, revenue and other basic information.
2. Personal information
You will need to provide your basic contact information and other related details to apply for a small business credit card.
3. Personal guarantee
As a small business owner, you will be responsible for your small business credit card. This means that if you fail to make payments on your credit card, you are personally responsible.