Back

Burst Biz

6 min read

A Comprehensive Guide to Selecting the Right Business Credit Cards for 2023

Credit cards have existed for a while. Most American adults carry one with them at all times. It’s not surprising to learn that small business owners frequently utilize business credit cards for a variety of reasons given the popularity of personal credit cards.

 

When you see your company name on a credit card, you nearly feel a sense of success. Even while it could be a little exhilarating, it’s crucial to keep in mind that credit cards are financial instruments. They can also be hazardous when misused, just like any other tool. Hence, if you choose to learn how to obtain a company credit card, you pledge to utilize it responsibly.

 

What are the reasons for obtaining a business credit cards?

 

There are several reasons you might want to get a business credit cards, regardless of the type of business you have. These credit accounts can help you build your business’s credit while allowing you to access the money you need when you need it.

 

You can also use rewards programs and business credit cards to pay off high-interest debts with 0% intro APR promotions for the first calendar year or longer. Below, we’ve included a breakdown of the most significant benefits of business credit cards.

 

Build business credit

You’ve put in a lot of effort as a consumer to establish a high credit score. On the other hand, if your company is like the majority of startups, it has no credit history at all. You must have a solid payment history if you want to build business credit, just like you would for personal credit.

 

Without a loan of some kind, it is impossible to accomplish that, and revolving loans, such as credit cards, are recognized for working swiftly.

 

All of the main credit bureaus receive reporting from the leading small business credit card issuers. Your business credit score rises as you appropriately utilize your card. This may enable you to enhance your business credit card limit or possibly qualify for loans that your company previously wasn’t eligible for.

 

Get access to the money you need

 

One of the largest obstacles for start-up firms, whether you’re a lone proprietor or a small startup, is company funding. Early-stage enterprises frequently devote their entire cash flow to product development, marketing, and order fulfillment. Sadly, this leaves the majority of businesses cash-strapped, which can present serious problems like:

 

a failure to fulfill purchase orders. You might not have the money on hand to complete a sizable purchasing order.
office materials are lacking. Office supplies are necessary to run your company, but they may also add up quickly for cash-strapped companies.

 

The good news is that compared to personal credit cards, business credit cards often have higher credit limits. You can get through the growing pains your company will probably go through with the aid of a substantial line of credit.

 

Track and manage business expenses

 

A smart business owner closely monitors every dollar that enters and exits their company. Nevertheless, if you employ a combination of cash and several business spending accounts for your business, expense tracking might easily turn into a full-time job.

On the other side, you might make purchases with your business credit card and routinely pay it off with cash. This makes spending tracking and management easier by turning your credit card into a ledger of all the costs your company incurs. Some choices, like Burstbiz, even include integrated analytics and spend tracking to simplify the expense management process.

 

Gain from reward systems

You probably carry a rewards credit card in your wallet, but did you know that they may be used for business purposes as well? A lot of business accounts also come with credit card rewards when the account is opened, in addition to other benefits.

These awards will typically fall into one of two groups:

 

Cashback bonuses

Every time you use your credit card, a certain portion of your total purchases is returned to you in cashback benefits.
travel benefits. Every time you use your credit card, you accrue bonus miles or points toward vacation. These bonus points can be saved and applied to travel expenses.

 

Although these are the two most popular rewards credit card options, they’re not the only ones. Other programs may offer gift cards, statement credits, etc.

Also, make sure to read the fine print. While most reward programs apply to every dollar you spend, some will only apply to “eligible purchases,” and there may be a cap on the number of rewards you can earn.

 

How to apply for a business credit card in 6 easy steps

 

There’s a good chance that you’ve previously applied for a credit card. Choose the card you want, provide the lender with your name, birthdate, social security number, address, and details about your salary, and they will decide.

Businesses, however, carry more risk. The lender might not be able to collect the debts your business owes if it closes its doors. So, applying for a corporate credit card requires a little more work than applying for a personal one. The solution to the query “How to open a company credit card” may be found below.

 

Step 1. Identify your needs 

It’s critical to take your company demands into account before you begin comparing your options. You should remember that your company has special needs of its own. There are a few aspects to consider, such as:

 

Credit credit. Do you pay for purchase orders exceeding $10,000 with a credit card? If so, you should apply for a card with a large credit limit.

 

Employee Cards. Do you allow some of your staff to make purchases using your credit card, or are you the only one who will use it? Your credit card provider must support this choice if you require numerous authorized users.

 

Intentions. What purpose do you have for using your credit card? You’ll probably require a different kind of credit card if you intend to use it for balance transfers as opposed to using it for regular purchases.

 

Step 2. Do your research

 

There are a variety of incentives available from various credit card companies. Find lenders who are in line with your values by doing your homework.

 

Also, it’s crucial to appropriately use your credit card, which can be challenging for small business owners. Learn how to use your account properly by doing some research so you don’t end up drowning in debt.

 

Step 3. Consider your eligibility and creditworthiness

 

Usually, business credit card restrictions are more stringent than personal credit card standards. A strong corporate credit score is advantageous, and your company needs to generate substantial, consistent revenue.

Some lenders will base their decisions on your personal credit history if your company has no credit history as long as you’re ready to personally guarantee that the debt will be repaid. Of course, in order to use this option, you must have good personal credit.

 

Step 4. Gather the information you need to apply

 

 

Applications for business credit cards often ask for a lot of details. Typically, credit card providers may need information such as your company name, employer identification number (EIN) or tax ID, business address, evidence of annual income, and even the number of employees. The application procedure will go more smoothly if you have this information on hand, so gather it beforehand.

 

Step 5. Choose the right credit card

 

There are several business credit card offers to pick from, as was already discussed. Each offer has a unique credit line, rewards program, fee schedule, and bonuses. Organizations of various types will have varying needs or specifications. A tiny organization seeking a credit card, for instance, has different requirements than an enterprise firm.

 

What follows should be considered while you compare:

 

Annual fees.
Some annual fees for company credit cards are astronomically expensive. Some, on the other hand, have absolutely no annual cost.
Interest rates.
The cost of a credit card is often its interest rate, therefore the lower it is, the better.
Foreign transaction fees.
Look for a credit card that doesn’t impose international transaction fees if you frequently travel for business.
Rewards.
Think about the rewards you’ll utilize most frequently. For instance, travel incentives could lower your company’s travel costs.
Capabilities.
Some business accounts have unique features, like better spending control and the capacity to provide cards to your staff. When weighing your selections, consider the features you require.

 

Step 6. Applying for a business credit cards

It’s time to complete the application now that your paperwork is ready and you’ve decided the card you want. As you go, be sure to provide the most accurate responses to each question. Your application could be rejected if you provide inaccurate information.

 

How to apply for a business credit cards

Choosing the perfect business credit card is one thing, but being approved is another. Although obtaining these cards is typically more difficult than obtaining personal credit cards, there are some things you can do to increase your chances.

For your best chances of being authorized for a company credit card, abide by the 4 best practices listed below.

Optimizing personal and business credit scores

You can do a number of things to raise your credit score. You may, for instance, pay more than the required minimum on your monthly payments, maintain modest balances, and watch out for having too many hard queries made on your credit report.

To start, obtain a copy of your credit reports for both your personal and commercial accounts. Next, think about what you can do to raise your credit score and raise your approval prospects.

Moreover, look for errors in both your personal and company credit reports as they could result in rejections.

Also, refrain from paying for business expenses with a personal credit card. This will prevent company activities from having an impact on your personal finances and credit score.

 

Avoiding maxing out credit lines

By using all available credit, you demonstrate to lenders that you require further revolving credit. Doing so could have a negative impact on your credit score and your future capacity to obtain new loans because that’s not a positive indicator.

 

Maintaining financial records

You’ll probably need to produce financial documentation to the credit card company you choose to demonstrate your personal and business income. There’s a strong risk the lender will reject your application if you can’t.

By keeping your financial documents up to date, you can completely prevent this headache. Keep track of all of your earnings—both professional and personal—as well as your outgoing costs. This advice is about efficient accounting, which can help you obtain a credit card and strengthen the financial situation of your company.

 

Following good business practices

It might not seem like adhering to ethical business practices can help you get a credit card authorized, but that assumption is untrue. Sound financial procedures are part of ethical corporate conduct and can result in credit card approvals.

 

Getting a business credit card with Burstbiz

A guide to getting a business credit cards

 

BurstBiz is an ultimate Solution for Net 30 Vendor Account and Credit Limit Increase. As a business owner, you know how important it is to have access to credit. It allows you to make necessary purchases, pay your bills, and grow your business. However, building and maintaining a good credit score can be challenging, especially if you are just starting out. That’s where Burstbiz comes in – a platform that offers expert guidance and support to help you get the credit you need.

 

The bottom line is that Burstbiz offers one of the best corporate cards on the market today.

Need help building business credit?

Join more than 3,043 successful business owners and subscribe to our newsletter. You’ll get free tips and hacks on building your business credit every 2 weeks.