Startups are a little different from traditional small businesses. In general, the intention of these young companies is to make waves with a groundbreaking product or service. If you are one such entrepreneur, a credit card that can fulfill your company’s unique needs will be essential. Show
With the right credit card, you’ll have access to necessary capital, flexible financing terms and perks that will help you start your business and connect with clients around the globe. You’ll also be able to build your business’s credit separate from your personal credit, which can help if you ever apply for a business loan. Startup business credit cards are most appropriate for the requirements of a company that’s preparing to disrupt the marketplace. The best credit card for small-business startups depends on what you most want from the account. Ink Business Preferred Credit Card: Best for its sign-up bonus
If you’re running a startup, you’re probably no stranger to budget constraints. If you can use every dollar you can get, a credit card that gives you a big welcome bonus will be helpful. With the Ink Business Preferred® Credit Card, you can earn a sign-up bonus of 100,000 points (after spending $15,000 on qualifying purchases within three months from account opening), which is worth $1,000 in cash. If you use the points for travel expenses by redeeming them through Chase Ultimate Rewards, they’ll be worth even more — up to $1,250. Given this card’s modest annual fee, that’s extremely generous. To get the bonus, you’ll need to meet the spending requirement, so consider what you’ll charge and how you’ll manage the bill. You’ll want to pay the debt off by the due date to reap the full benefit of the sign-up bonus, so plan ahead. Pros
Cons
American Express Business Gold Card: Best for flexible payment arrangements
Need to pay for a big marketing campaign or extra research and development but don’t have the money for it at this moment? The American Express® Business Gold Card is a charge card, so there is no preset credit limit, and you can pay for exceptionally large purchases. At the end of your billing cycle, you can pay the entire balance in full with no interest added or use the Amex Pay Over Time plan. If you choose Pay Over Time, you can split up the cost of a large purchase into monthly installments with interest. This card combines the advantage of a high-limit charge card with a credit card that allows for revolving balances, making it great for startups with potentially large purchases on the horizon. Pros
Cons
American Express Business Platinum Card: Best for travel
If you travel quite a bit for your startup business, you’ll want a credit card that can help you travel economically while remaining comfortable. The Business Platinum Card® from American Express is dense with valuable benefits that can help you do both, such as up to $200 in statement credits per calendar year toward qualifying airline fees at one qualifying airline. Cardholders also get up to $189 back per year on Clear membership, up to $100 in statement credits toward Global Entry or TSA PreCheck and complimentary access to 1,300+ of the finest airport lounges in the world (including access to Amex Centurion lounges). These benefits extend to accommodations, too. Cardholders automatically get Marriott Bonvoy and Hilton Honors elite status, which grants you access to free room upgrades, breakfast and late checkout. And if you spend $15,000 on eligible purchases within the first three months of card membership, the 120,000 Membership Rewards points welcome bonus will be yours, which can pay for several business flights. Note, of course, all of these great perks come with a hefty $695 annual fee. Pros
Cons
Ink Business Cash Credit Card: Best for cash back
Most startups require a physical workspace. So, if you’re creating such a space, a business credit card that earns major cash rewards on office supplies and telecommunications bills is key. The Ink Business Cash® Credit Card offers 5 percent cash back on the first $25,000 you spend at office supply stores, as well as on internet, cable and phone services every year. If you max those rewards out, they’ll total $1,250 in cash. You also earn 2 percent back at gas stations and restaurants on the first $25,000 in combined spending each account anniversary year — and if you max that out, you’ll earn $500. Anything else will score you 1 percent cash back. Additionally, you get access to a 0 percent intro APR on purchases for 12 months (followed by a 16.24 percent to 22.24 percent variable APR), should you have a large purchase on the horizon. Pros
Cons
Capital One Spark Cash Select – 0% Intro APR for 12 Months: Best for financing with less-than-excellent credit
A startup’s first year can be expensive, which is especially challenging because it can take a while to become profitable and secure funding. For that reason, many startup founders take on debt in the first year. With the Capital One Spark Cash Select – 0% Intro APR for 12 Months, you’ll have 12 months of 0 percent intro APR on new purchases (followed by a 18.99 percent to 26.99 percent variable APR). All you need to do is make your minimum payments each month and pay off the whole balance before the introductory period ends, and your charges will be free of interest costs. As you charge, you’ll also earn an unlimited 1.5 percent cash back on everything you spend (plus 5 percent back on hotel stays and rental cards booked through Capital One Travel). This card also has less challenging qualification requirements compared to many other business cards — its credit requirement is “good,” while many other business cards require excellent credit. Pros
Cons
U.S. Bank Business Platinum Card*: Best for a balance transfer
If you’ve already acquired a sizable amount of debt for your startup and don’t have the cash to quickly pay it off, a balance transfer credit card could be instrumental in keeping costs to a minimum. The U.S. Bank Business Platinum Card offers a 0 percent intro APR for the first 18 billing cycles on both balance transfers and purchases made within the first 30 days of opening the card (followed by a 14.99 percent to 23.99 percent variable APR), making it one of the best business balance transfer credit cards on the market. Outside of the balance transfer fee of 3 percent ($5 minimum), no financing costs will be added to the balance, so every month your debt will decrease by the same amount as your payment. Just be careful to adhere to its terms, since the deal will end prematurely and the regular rate (or higher) will begin if you pay late, make a payment that is returned or your account exceeds its credit limit. Pros
Cons
Business credit cards for startups FAQ{“@context”:”https://schema.org”,”@type”:”FAQPage”,”mainEntity”:[{“@type”:”Question”,”name”:”Can I apply for a business credit card when my startup hasn’t made any money yet?”,”acceptedAnswer”:{“@type”:”Answer”,”text”:”Yes. However, while your startup doesn’t need to be generating revenue, you will have to prove that you have an income source that is sufficient to satisfy the monthly payments on the credit line.”}},{“@type”:”Question”,”name”:”What business credit card is easiest to get?”,”acceptedAnswer”:{“@type”:”Answer”,”text”:”Business credit cards for people with bad credit such as the Wells Fargo Business Secured Credit Card are the easiest to obtain due to lower credit score requirements.”}},{“@type”:”Question”,”name”:”Does my startup need to be incorporated to get a business credit card?”,”acceptedAnswer”:{“@type”:”Answer”,”text”:”No. As a sole proprietor, you can apply for a small business credit card. You would use your Social Security number rather than an employer identification number.”}},{“@type”:”Question”,”name”:”What happens if my startup dissolves and I can’t pay my small business credit card bill?”,”acceptedAnswer”:{“@type”:”Answer”,”text”:”You will almost certainly be liable for the debt since most business cards require a personal guarantee. If you don’t make your payments on time, your credit reports will show delinquencies, which will lower your credit scores. If the accounts go into default, you can be sued for the amount outstanding or the credit issuer will send the account to collections.”}},{“@type”:”Question”,”name”:””,”acceptedAnswer”:{“@type”:”Answer”,”text”:””}}]} The bottom lineBusiness credit cards are worthwhile tools for startups, and the key is to choose the right one for you and your company — then to manage it responsibly. After all, while your business may be disruptive, your credit card should be constructive. As always, before you apply, consider our picks for the best small-business credit cards, as there might be additional options that suite your business’ needs (and wants). *The information about the U.S. Bank Business Platinum Card and Wells Fargo Business Secured Credit Card has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer. Which credit card is best for a starter?Discover it® Secured Credit Card.. Capital One SavorOne Student Cash Rewards Credit Card.. Capital One Platinum Credit Card.. Petal® 2 "Cash Back, No Fees" Visa® Credit Card.. Capital One QuicksilverOne Cash Rewards Credit Card.. Capital One VentureOne Rewards Credit Card.. Discover it® Student Cash Back.. What are the easiest unsecured business credit cards to get?Easiest Unsecured Credit Cards for Businesses to Get. Overall: Capital One Spark Classic for Business.. Bad Credit: Credit One Bank® Platinum Visa® for Rebuilding Credit.. No Personal Guarantee: Brex Corporate Card for Startups.. Fair Credit: Office Depot Business Credit Card.. Do business credit cards do a hard pull?Applying for your first business credit card will trigger a hard credit inquiry on your personal credit, which could lower your score by a few points. And lenders might continue to conduct personal credit inquiries when you apply for additional small-business credit cards or small business loans.
Can I turn my personal credit card into a business account?Yes, depending on the card issuer, you can switch a personal credit card to a business credit card. Closing out a personal credit card could affect your credit score, so weigh your options if you want to close the account after switching to a business credit card.
|