Best Business Credit Cards With No Annual Fee for 2022
You don’t need a corner office and a fleet of underlings to get a business credit card. You don’t even have to have a registered LLC or corporation to apply for one. Drive an Uber or occasionally sell stuff on eBay or Etsy? Walk dogs or children? Consult, contract or freelance? Your business need only be designed to earn revenue (and not necessarily a lot, either) for you to qualify for a business credit card.
Here’s why it might be worthwhile. Compared to general-purpose consumer cards, business credit cards offer:
- Higher spending limits (around $55,000 on average versus $30,000).
- Lower interest rates (1 to 3 percentage points less) on outstanding balances than average consumer card APRs.
- Discounts on business-y services, like shipping, software, web services and more.
- Free employee credit cards and financial tools to help manage your growing empire.
- Rewards on business-related purchases, like office supplies and cell/internet/cable connectivity charges, on top of standard rewards card categories like gas, dining and travel. According to the investor.com cashback business credit card calculator, a small business that spends roughly $2,500 a month could earn $300 to $835 in cashback rewards per year.
Business credit card calculator: Find the best business credit card for you
The investor.com business credit card calculator shows how much cashback you can earn from the cards we track in our database. The results are based strictly on the spending data you enter. (See Methodology for more.) For the most accurate results, adjust the default “Spend Category” amounts to reflect your actual spending.
What is the best credit card for small businesses?
Based on our analysis of average small-business expenditure data and credit card rewards rates across five common spending categories, the best credit card for small businesses is the Chase Ink Business Cash Card.
This no-annual-fee card pays 5% cashback on office supplies, internet, and cable and phone services, 2% cashback on gas station and restaurant purchases, and 1% on everything else. It offers a sizeable $750 welcome bonus (after you spend $7,500 in the first three months), and charges 0% interest on purchases for 12 months.
Investor.com calculates that a small business that spends roughly $2,500 a month would earn $835 in cash back annually with this Chase business credit card. Add in the welcome bonus (which equates to a 10% cashback rate), and a Chase Ink Business Cash Card pays out a total of $1,585 in the first year for the average small business.
Let’s pause here for a brief word from our sponsors: Just kidding! We don’t have any sponsors! In case you were wondering — and we hope you always do when reading financial product reviews on any website — Chase does not pay us any money to say nice things about its Ink Business Cash Card. In fact, investor.com receives no money from any of the business or personal cashback credit cards or high-yield savings accounts we review. The results you get from our Best Business Credit Cards calculator and the words in our reviews are based solely on data and our unbiased assessment of each provider’s offerings. We just thought you should know all that. And now, back to our regular programming.
investor.com fun fact: A small business that spends roughly $2,500 a month on a business rewards card could earn $300 to $835 in cashback rewards per year using a no-annual-fee business card.
5 best small-business credit cards of 2022
To calculate the best business credit cards, investor.com started with average spending data across the five most common small-business expense categories (cell phones, dining, travel, office supplies, gas, and the catch-all “other”). Based on the rewards rates paid out by more than a dozen business credit card issuers whose products we track, the top five cashback business credit cards with no annual fee are:
Chase Ink Business Cash Card: As mentioned above, the 5% cashback rate on business essentials plus 2% on gas and restaurant spending means a business that spends around $30,000 a year using this card will earn $835 in cashback per year. A chonky $750 sign-up bonus, 0% intro APR on purchases for a year — and the ability to combine points with other Chase Ultimate Rewards-earning cards — is impressive. Less so, the $25,000 annual spending cap for the elevated rewards categories.
U.S. Bank Triple Cash Rewards Visa Business Card: Need a cheap financing option? With U.S. Bank’s Triple Cash Rewards card you get a lengthy 15 months of interest-free spending — and the 0% APR also counts on balance transfers, although transfer fees apply and you’ve got just 30 days to make the transfer. The unlimited 3% cashback rate applies to common business expenses, which adds up to an average of $712 cashback per year. There’s also $500 up for grabs if you spend $4,500 on the card in the first 150 days.
American Express Blue Business Cash: This base model of AmEx’s fleet of business credit cards has no annual fee and a flat 2% cashback rate on the first $50,000 you spend each year. (Amounts above that earn 1%.) For the average small business, that nets $619 in cashback per year. You also get a 0% APR on purchases for 12 months, and a welcome bonus of up to $250 after spending $3,000 in the first month. Also good to know: If you exceed your credit limit, AmEx is much more forgiving than your average credit card issuer.
Costco Anywhere Visa Business Card by Citi: The 2% to 4% cashback rate on gas, restaurants, travel, and, of course, Costco and Costco.com purchases, puts $619 cashback in the pocket of an average small-business owner. (FYI: The rewards rates are identical to the consumer version of the Costco Anywhere Visa.) Use $120 of what you make to upgrade to a Costco Business Executive membership, and the 2% cashback rate on warehouse club purchases is doubled to 4% (up to $1,000 cashback per year). However (dramatic pause alert), unlike with most biz cards, employee cards require a separate annual membership (that’s $60) per year apiece. Also, look elsewhere if you’re banking on a sign-up bonus or 0% intro APR on purchases or balance transfers.
Truist Business Cash Rewards Credit Card: If you’re a Truist business banking customer, your relationship status with the bank enhances your earnings with this cashback card. Redeeming rewards into a Truist biz bank account qualifies for a 10% to 50% loyalty bonus on your earnings, based on your balance. Just know that the tiered rewards (3% on gas, 2% at restaurants and office supply stores) are good only on up to $2,000 a month. Amounts that exceed that are rewarded at the 1% base cashback rate until the next month.
Is the Chase business credit card — or any of the others highlighted above — truly the very best choice for your small business? Our definitive answer is ... maybe.
Remember, we use average small-business spending data to calculate the cashback rewards potential of the cards in our database. The list of the top five business credit cards above is based on those averages. Based on your spending, the results might be very different. Use the business credit card calculator to get customized recommendations based on how much your business spends each month.
Looking for a rewards card for personal use? We got you. The investor.com customizable cashback credit card calculator will help you pick the most rewarding cashback credit card for your wallet.
Business credit card FAQs
- Should I apply for a business credit card?
- Can my small business get a credit card?
- How do I get a business credit card?
- Can I use my EIN to get a credit card?
- How to apply for a business credit card
- How much does a business credit card cost?
- What business credit card gives the highest limit?
- Will a business credit card affect my personal credit?
- Does an LLC have its own credit score?
- How do I check my business credit score?
- How to build business credit for your startup
- Tips for finding the best business credit card
Should I apply for a business credit card?
Mixing business and pleasure (finances, that is) can be a slippery slope. Having a credit card dedicated solely to work-related expenses makes it easier to separate the two, which the IRS greatly appreciates.
A business credit card can also be a tool for short-term financing needs. Plus, many cards pay you back in points or cash back for work-related expenses like office supplies, telecom bills, advertising, and shipping — categories often missing from consumer card rewards programs.
The benefits of getting a business credit card include:
- Help establishing a business credit history: Having an established line of credit in your business’s name is a good look if you plan to apply for other types of loans in the future. (That’s right: Your business has its own, separate credit score! More on this in the FAQs below.) This is especially helpful in the startup stages of building your business empire.
- Access to greater capital: Having access to a line of credit can help a startup get off the ground or an established small business expand. According to Experian data, the average consumer credit line — the spending limits granted by credit card lender(s) — is approximately $31,000, while the average small business has access to around $56,000 in credit card purchase power.
- Protection for your personal credit: You want to avoid maxing out your personal credit cards to pay for business expenses, which can cause your credit score to plummet. Just be aware that some small-business cards report activity to both your personal and business credit files. (Check your personal Experian, TransUnion and Equifax credit files for free at annualcreditreport.com to see what’s up.)
- A cash flow buffer: Cash flow ebbs and flows, and not always on a strict schedule. When vendor payments pile up at the same time as ongoing business spending obligations, a business credit card can ensure providers get paid on time, and give you an interest-free grace period (so long as you regularly pay your balance in full). That float can be a big help as you wait to replenish your cash coffers. If you end up carrying a balance from month to month, you’ll likely pay less interest on the balance — roughly 1 to 3 percentage points less — on a business credit card versus a general purpose consumer card.
- Access to accounting and business management tools: Most business credit cards seamlessly integrate with business accounting software, like QuickBooks. Some providers offer more souped-up expense management tools than what’s available via a consumer card account. Many also offer perks tailored to business clientele. We’re talking about discounts or free trials on software, shipping services, web services and business travel. And most lenders offer free employee cards, which can simplify — and add transparency to — company spending.
- Sign-up bonuses and different rewards spending categories: Like consumer cards, many business credit cards offer sign-up bonuses (anywhere from $300 to $750 or more) after you spend a certain amount on the card within the first three, six or nine months. There are also business rewards credit cards that offer ongoing cash back — 1% to 5% — on each dollar you spend on work-related expenses like office supplies, telecom bills, advertising, and shipping. The extra money can come in handy to offset business expenses.
investor.com quick tip: Got big startup costs? A large business purchase on the horizon? Look for a business card that offers an introductory 0% APR on purchases. (Note: Minimum payments still apply.) The average no-interest period among credit cards in our database that offer introductory 0% APRs is 11 months. Plan accordingly. The regular purchase APR kicks in after that.
Can my small business get a credit card?
If you do something that’s designed to generate revenue — looking at you, side hustlers, freelancers, contractors, nonprofits, sole proprietorships, weekend-only CEOs — you can qualify for a business credit card. Many business credit cards have no minimum revenue, employee head count or time in business requirements for approval.
Informal business owners can apply for a business credit card as a “sole proprietor,” which simply means you’re running the entire show on your own. You’ll use your name (don’t be cute and make up a fake business name) and Social Security number to apply, and your personal credit will be used to guarantee the account.
investor.com quick tip: Can you get a business credit card if you have no revenue yet? Yup, but your odds of approval are much better if the issuer allows you to list other personal/household income income sources (from a full- or part-time job) on the application. Some take sales projections under consideration. And, if your edible dreamcatchers (it’s cake!) aren’t selling like hotcakes yet, enter $0 for business revenue. Don’t fudge it: You may be asked to provide verifiable proof that your cute cake business generates income.
See “How to apply for a business credit card” in the FAQs below for more.
How do I get a business credit card?
There are four steps to getting a business credit card, whether you run an established LLC or just launched your startup last week:
- Check your credit scores. If you’ve financed any aspect of your business and/or work with vendors that report payment history to commercial credit reporting agencies, you have a business credit score. (Here’s how to check your business credit score.) If you don’t already have an established business credit history, lenders will factor in your personal credit history when reviewing your application.
- Identify a business card to apply for. To narrow the field, use the investor.com business credit card calculator to generate a customized list of no-annual-fee cashback cards based on how much you’ll earn from each. Keep applications to a minimum. Each one generates a “hard pull” in your credit file that can temporarily lower your score by a few points, which may hurt your chances of approval.
- Fill out the application. You’ll need to provide your Social Security number or tax identification number (TIN), information about your business (name, revenue), personal income, etc. (Read more details on the application process below.)
- Pay your bills on time and be a model credit customer. Just like with a personal credit card, heed all due dates, avoid overextending yourself (keep well within your credit limits), and generally mind your Ps and Qs. As time passes, your stellar behavior will lead to higher spending limits and eligibility for better borrowing terms.
investor.com quick tip: Mind the cap. Spending caps — when a card ratchets back, say, a 5% rewards rate to 1% after you spend a certain amount in a particular category — can limit your rewards earning potential. Here’s one workaround with issuers that calculate caps based on the calendar year and not the account year (the date you opened the account): Apply for the card toward the end of the calendar year to milk as much as you can from the rewards program right off the bat.
Can I use my EIN to get a credit card?
Yes, you can get some types of business credit cards — mainly corporate cards — using just an EIN (employer identification number). But this privilege is typically only extended to C-corps, S-corps, LLCs and LLPs registered in the U.S.
The majority of business credit card companies require small-business applicants — even ones that have an EIN — to also provide a Social Security number as a personal guarantee for any debts. That essentially makes you a co-signer for your business’s credit card. If your business is unable to pay back any debts, you are personally on the hook to make good on the money your business borrowed. Similarly, sole proprietorships can qualify for a business credit card using only a Social Security number, which is used to run a personal credit check and secure the line of credit. Only businesses with a well-established, long-term business/commercial credit history are able to qualify for a credit card (usually a corporate charge card) with only an EIN.
investor.com quick tip: How to get an EIN for your business. You can apply for an EIN for free with the Internal Revenue Service, and if all goes smoothly, your EIN (also known as a Federal Tax Identification Number) will be issued immediately. If it feels like that’s rushing things, the IRS offers fax and snail-mail EIN application options.
How to apply for a business credit card
To apply for a business card, you’ll be required to provide both business and personal information. A typical business credit card application will ask for:
- Your legal business name: If you haven’t set up an LLC or are the sole proprietor, you can just use your name and Social Security number (as your business tax identification) on the credit card application. Don’t make up a business name on the spot. You may be asked for proof (and, no, Photoshopped letterhead doesn’t count). You can also apply for an Employer Identification Number (EIN) with the IRS, which you should do if you have or plan to hire employees.
- Company size, structure and type of business: You’ll be asked the number of employees (count yourself), the type of business you’re in, how long you’ve been in business, and to describe your company structure. Indicate “sole proprietorship” if it’s just you, “partnership” if you’ve got a partner, or “corporation” if you set up an LLC. Some lenders may ask for a business checking account.
- The money stuff: What is your business’s annual revenue? Here they’re looking for gross revenue — what your business pulls in before taxes and expenses. As tempting as it may be to exaggerate your business prowess, save that for networking events. Tell the truth and nothing but the verifiable truth on your business credit card application. The lender may ask for confirmation and you’ll need documents to back up your bragging. Also be prepared to provide an estimate of the monthly spending you’ll put on the credit card.
- Personal information (and more money stuff): What is your annual household income? This is different from your business revenue. Lenders use information about your cash flow and existing credit obligations to calculate how much of a default risk you are, especially if you’re running a small business or lack a business credit history. If a spouse or partner helps cover the household bills, you can include their annual income in your answer if the application allows it.
If you’re more of a visual learner, check out these shots of business credit card applications for examples of the information lenders ask you to submit:
How much does a business credit card cost?
Pshaww… put your wallet away. Like regular credit cards, there are plenty of business credit cards that charge no annual fees. Even better, you can get a no-annual-fee business credit card that pays you money via a sign-up bonus and cashback or points on your spending.
There are, however, potential transaction fees:
- Interest: If you carry a balance on the card, you’re responsible for any interest charges.
- Balance transfer/cash advance fees: Even if a business card offers an introductory 0%-interest period, the administrative fees — typically around 3% to 5% of the amount transferred or advanced — will add to your card costs.
- Penalty fees: Be careful about late payments, returned payments and other untoward actions, all of which trigger penalty fees. (The actual fees are spelled out on every credit card’s terms and conditions sheet.)
- Redemption options: Is flexibility important to you or will cashback (literally, getting cash paid back to you) do? A card may award “points,” “miles” or “cashback” on your spending but allow you to convert or redeem your bounty in other ways. Weigh your redemption options to eke out the highest dollar value when you cash in.
- Foreign transaction fees: Purchases from businesses that operate outside of the U.S. may be subject to this fee, which is usually around 3% of the transaction amount. Some business cards waive this fee.
- Third-party subscription fees: Most business cards offer free synching with bookkeeping software like QuickBooks. You’re responsible for any subscription fees charged by third-party providers.
investor.com quick tip: Annual fee vs. free. There's no need to pay an annual fee for a business credit card. But it could be worth it. Some annual-fee cards offer higher rewards rates, sign-up bonuses, and more robust card perks than their no-fee peers. For example, the $0 annual fee Chase Ink Business card doesn't come with the trip cancellation/interruption insurance or cell phone protection that’s included with the Ink Business Preferred card, which has a $95 annual fee. Chase’s no-fee card also charges a 3% foreign transaction fee vs. 0% with the Business Preferred card. Our advice: Save yourself the upfront cost unless the rewards and additional perks will cover the annual fee, and some.
What business credit card gives the highest limit?
With few exceptions, most lenders do not advertise maximum credit limits for business credit cards because the amount is based on each applicant’s qualifications. Even cards that advertise no pre-set spending limits — like a few from American Express — impose limits on an account-by-account basis. (So don’t get any crazy ideas, hotshot.)
Based on the most recent credit card data available from Experian, the average amount of credit extended to small businesses is $56,100. For comparison, the average consumer credit limit is $30,233.
When it comes to business credit limits, the better question to ask is this: What credit limit will I be granted? As a starting point, check out a card issuer’s terms and conditions where, in the fine print, many reveal minimum credit limits.
Our research found that no-annual-fee business cards aimed at those with good or excellent credit have minimum starting credit lines in the $2,000-$5,000 range. Then there are the outliers. For example, the Capital One Spark Classic for Business card disclosure states that customers may have to settle for a low $300 initial credit limit. On the flip side, when you see a card like the Capital on Tap Visa touting “credit limits up to $50,000” in its marketing materials, take a beat: “Up to” is lawyerspeak for “there are no guarantees you’ll be approved for that much spending power.”
If you’re looking for a card with more spending leeway, the American Express Blue Business Cash card has an “Expanded Buying Power” feature that allows business owners to spend beyond the credit limit based on payment history, credit record and other factors. The overage is added to your minimum payment due. Make sure to pay it back in full by the due date, or American Express will apply the penalty interest rate to your entire balance, including the amount spent above the credit limit.
investor.com quick tip: Don’t let a low initial credit limit get you down. Your credit card company just wants to get to know you a little better before it loosens the purse strings. Ask the lender if it periodically reviews accounts for credit line increases. If not, request a higher credit line. (Note, this may trigger a formal credit inquiry in your file.) A track record of on-time payments, up-to-date income and business information, and overall responsible credit use will go a long way towards ingratiating yourself to your lender.
Ultimately, the answer to how much spending power you’ll be granted is a credit card Catch-22 — you won’t know what credit limit you’ll get until after your business card application is approved. But … you’re not completely at the mercy of a random shake of the credit line Magic 8 Ball.
Small-business credit card limits are based on an individual applicant’s creditworthiness. Lenders use a standard list of factors to determine how high of a credit line to extend, taking into account:
- Personal and/or business credit score
- Payment history
- Business and personal income
- Cash flow
- Existing credit utilization
- How much credit you’ve applied for recently
Anything you can do to gussy up your credit profile will help you qualify for a larger line of credit. For example, try not to look too thirsty: Refrain from applying to multiple credit cards at once, keep any existing balances below 30% of your available credit limit (10% is even better), and shoot for an unbroken streak of on-time payments.
investor.com quick tip: Spending above and beyond. Have a big purchase on the horizon that exceeds the spending limit on your business credit card? Ask your card issuer to raise your credit limit to accommodate the charge just this once. Many are willing to offer a temporary increase for good customers, although you may be asked to prepay a portion of the amount to mitigate the lender's risk.
Will a business credit card affect my personal credit?
There are two times when a business credit card will impact your personal credit score:
- When you apply for the card. If you don’t have an established business credit history — or even if you do, but have a small or newer business — lenders will check your personal credit file to determine if you qualify for a business credit card. This formal inquiry (called a “hard” inquiry) will temporarily shave a few points from your credit score. The impact isn’t huge, since inquiries for new credit account for only around 10% of your overall credit score.
- If you default on payments or are late paying your bill. Business credit card delinquencies don’t just impact your professional credit image. Since most lenders require small businesses to sign a personal guarantee during the application process before they’ll extend credit, you are personally responsible for repaying debts on a business credit card. Defaults and late payments can have a big impact on your personal credit score, since payment history weighs in at a hefty 35% or so of the overall score calculation.
Whether other business credit card data — such as monthly credit activity, on-time payment history — is reported to consumer credit bureaus varies by lender. The best way to prevent business credit use from negatively affecting your personal credit score is to keep your account in good standing.
Does an LLC have its own credit score?
It sure does! Setting up a Limited Liability Company (LLC) legally separates your business and personal finances and makes it possible for your LLC to have its own credit score. But you don’t need to set up an LLC, S-corp or C-corp to have a separate business credit score.
To have a business credit score, a business need only have an EIN (employer identification number) — which you can get for free from the IRS — and accounts in its name that are reported to the credit bureaus. If you run a sole proprietor business that’s not registered as a separate legal entity, your personal credit score is a stand-in for your business credit score.
The same way your personal credit score acts like your financial GPA, your business’s credit score grades how you’ve handled financial relationships in the past. It’s a way for interested parties to measure risk — specifically, the likelihood a business will miss payments or default on a loan. Also, just like some employers will run an applicant’s credit as a general reputation check, some vendors will use an LLC’s credit score to decide whether or not to do business with a potential client.
Five key factors determine a business credit score:
- Payment history: Does the business make consistent, on-time or early payments on loans and/or trade accounts? How quickly are balances are paid off, and are there any late payments or accounts sent to collections?
- Length of credit history: This is based on the average age of accounts reported.
- Debt usage: Based on types of loans/lines of credit and credit utilization trends (how much of the lines of credit are tapped).
- Industry risk: Whether your business is in an industry that has a high failure rate (based on a business’s Standard Industrial Classification, or SIC code, and/or North American Industry Classification System, or NAICS code) and how likely it will be to experience financial distress within the next 12 months.
- Company size/public records: Based on the age of the business, annual revenue, assets and any public financial records of liens, judgments or bankruptcies.
There are three main business credit reporting agencies: Dun & Bradstreet, Equifax and Experian. Each uses its own proprietary formula to calculate a business’s credit score. Business credit scores have different ranges (E.g., 1-100, 0-300), versus 300 to 850 for personal credit scores. The higher the score, the better the credit rating.
Here’s how Experian defines risk on its 1 to 100 business credit score scale:
|Experian business credit risk ranges|
|Interest rate||Annual return|
|11-25||Medium to high risk|
|51-75||Low to medium risk|
Source: Experian Information Solutions, Inc.
“Proprietary formula” means that each bureau uses business credit data slightly differently in its credit scoring recipe. For example, Dun & Bradstreet’s Paydex score is based on just one factor: your payment history; whereas the FICO Small Business Scoring Service (FICO SBSS) range is 0-300 and is derived from data provided by multiple credit reporting agencies. This is why it’s a good idea to review your business credit files from all the reporting agencies.
investor.com quick tip: The benefits of separation. The best way to keep your business and personal credit as separate as possible is to make your business a legal entity (e.g., an LLC, S- or C-corp.). This makes reporting taxes, tracking assets and liabilities, and qualifying for loans and other lines of credit easier. Having business-only credit also may, in some cases, protect your personal credit score if a debt goes unpaid or a credit line is run up. (Note: This protection depends on whether a lender requires you to personally guarantee a loan with your own credit and its policy of reporting activity to the credit bureaus.)
How do I check my business credit score?
There are four main business credit scores used by lenders, vendors and other suppliers with which you might do business: Dun & Bradstreet, Equifax, Experian and FICO Small Business Scoring Service (SBSS).
Like personal credit scores (such as a FICO score or Vantage Score), business credit scores are based on the information in your business credit files. Unlike consumer credit reports — which are available for free from Equifax, Experian and TransUnion at annualcreditreport.com — there is no law mandating free access to business credit scores or reports. (Translation: Have your wallet handy, operators are standing by!)
Here are business credit score ranges, how they’re derived, and how to get free business credit scores (if available):
Dun & Bradstreet (D&B) Paydex Score. Score range: 1-100 based on dollar-weighted payment performance (overdue, in collections, on-time/early payments) reported to D&B over the past year. Requires getting a D&B number, or D-U-N-S number (data universal numbering system) to establish a file for your business.
Where to get a free D&B Paydex Score: Dun & Bradstreet’s CreditSignal provides 14 days of free access to four D&B business credit scores and ratings: D&B Paydex, Delinquency Predictor Score, Financial Stress Score, Supplier Evaluation and Risk Rating. You’ll also get alerts (though no details) when there are changes to your D&B score or ratings, as well as a monthly high-level summary of activity. Small businesses can get unlimited access to D&B scores starting at $15 a month.
Equifax Business Credit Scores. Equifax offers three scores: The Equifax Credit Risk Score (score range: 101-992) measures a company’s creditworthiness; the Equifax Business Failure Score (score range: 1,000-1,610) calculates the likelihood a business will go bankrupt or shutter in the next 12 months; and the Equifax Payment Index Score (score range: 1-100) is based on the business’s payment history.
Where to get your Equifax scores: Since March 2020, Equifax has waived the $99.95 fee on its small business credit reports. To request a free report, email your name, business name, EIN or federal tax ID, address and phone number to firstname.lastname@example.org with “business credit report request” in the subject line. Equifax business reports include Equifax Business Credit Risk, Business Failure and Payment Index scores, public records and payment trends for the past 12 months.
Experian Intelliscore Plus. Score range: 1-100 based on credit obligations (payment habits, balances, credit utilization, number of trade experiences), public records (recency, frequency and dollar amounts of liens, judgments or bankruptcies), company information (years in business, size, industry).
Where to get your Experian Intelliscore: For $39.95, Experian offers one-time access to your business’s CreditScore Report — a single report that reveals your Experian Intelliscore Plus score, financial stability risk rating, and general background on your business. A more detailed Experian ProfilePlus report is available for $49.95. Annual subscriptions are available starting at $189. Businesses that do not have a score (because you’re too new) can purchase a BizVerify report for $10 to see if your company is in Experian’s National Business Database and what — if any — other information is being reported.
FICO Small Business Scoring Service (SBSS). Score range: 0-300. FICO’s commercial scoring system is designed to measure the likelihood a small business will make on-time payments. It’s calculated using data reported to business and consumer credit reporting agencies. The scoring formula can also factor in financial and loan application information on the business. The U.S. Small Business Administration requires lenders to run a company’s FICO SBSS score for certain types of small-business loans.
Where to get your FICO SBSS credit score: Your FICO SBSS score isn’t for sale. At least not to you, the business owner. (Your banker and other commercial entities are FICO’s target customer.) But you can get your FICO SBSS score via the third-party provider Nav for $49.99 a month. This bundled report also includes full business credit reports and scores from other commercial credit bureaus — D&B, Experian and Equifax — and personal credit reports and scores from Experian and TransUnion. Nav assigns a letter grade (A-F) for each report. Nav also offers bundled reports (minus the FICO SBSS score) with various levels of detail starting at $29.99 per month.
investor.com free small-biz tool alert: Answer 10 questions about your small business’s credit use and Experian's Business Credit Score Planner will provide an estimate of your Experian Intelliscore. No, it’s not your actual business credit score. But the results are based on many of the factors that fuel Experian’s Intelliscore algorithm. Plus you can play with different scenarios to see how they might impact your score, which, we’re not gonna lie, is kinda fun.
How to build business credit for your startup
- Create a separate identity for your business. Apply for a business tax identification number (TIN). You’ll need an Employer Identification Number (EIN), which is free to get through the IRS, and available even if you run a sole proprietorship.
- Set up a business bank account and put any work-related accounts – like utilities and leases – in the business’s name.
- See if the main business credit reporting agencies (Equifax, Experian and Dun & Bradstreet) have existing files on your business. If not, you’ll have to set them up with each bureau.
- When opening credit lines, put them in your business’s name. However, don't open loans, establish trade lines with suppliers, or load up on small-business credit cards simply in the name of establishing credit.
- Ask your suppliers to report payment activity to the business credit bureaus if they don’t already. They’re not required to, so ask nicely.
- Play with Experian's Business Credit Score Planner on your lunch break to see how various scenarios might affect your business credit rep.
- Give it time. With good behavior — making on-time payments and keeping outstanding debts under control — your business will have a brag-worthy score in no time.
investor.com quick tip: Sometimes it is personal. Don’t ignore the health of your personal credit. Many financing companies, including business credit card issuers, factor in both your business and personal credit scores (that is, your FICO or VantageScore) on applications, especially if you run a small business or are in the early days of LLC-dom. To get the best terms on loans, keep both your personal and business credit in tip-top shape.
Tips for finding the best business credit card
There are a lot of issuers that offer solid credit card options for startups, new businesses and established companies. Look for a business credit card that:
- Rewards your spending. A card that pays you back on purchases is like getting a discount on business-related expenses. Look for a reward structure that aligns with (aka pays the highest cashback rates on) your biggest spending categories, such as office supplies, business internet, cable and phone services, travel, gas, and so on. Use the Back to topcashback business card calculator above to see how much your everyday spending could earn.
- Offers a sign-up bonus. This is your chance to earn a pile of cash for meeting certain spending requirements during the first several months of using the card. Investor.com found more than a dozen no-annual-fee business credit cards that offer new cardholders statement credits that range from $200 to $750.
- Charges 0% APR on new purchases or balance transfers. Paying no interest on charges at the outset can help you manage cash flow and keep business financing costs in check. It’s not hard to find a business credit card that provides no-interest financing for nine to 12 months, or more.
- No annual fee — or an annual fee that’s easily offset by the rewards you earn. There are plenty of no-fee business rewards cards. See the extensive list above, hint, hint.
- Free cards for employees. Most lenders allow the primary accountholder (the business owner) to add up to 99 employee cards for no additional charge. As the card boss, you’re given the power to set spending limits and alerts on authorized user accounts.
- Business tools to help you track expenses. Integration with commonly used accounting software like QuickBooks makes doing the books easier. Be aware there may be a third-party software subscription cost.
- Discounts on business-related products and services. Cards by established business lenders like American Express, Chase and Capital One have bargaining power with vendors that small businesses lack. They’re able to secure discounts for cardholders on things like accounting/payroll software and shipping services.
- Reports positive credit card usage to business credit bureaus. If you’re trying to establish a business credit track record, a card that reports on-time payments and debt usage to business credit reporting agencies is a plus. (Read the lender’s terms and conditions or call and ask about its reporting policies.) Since most business credit cards require small businesses (sole proprietors and even LLCs) to personally guarantee the debt, just assume that negative information like late payments and defaults will be reported in your personal and business credit files.
And now, some business credit card gotchas to watch out for:
- Balance-transfer fees. Consider this a reminder that good things, like 0% financing), often come in pricey packaging, like 3% to 5% balance transfer fees. (Gift horse metaphors also apply here.)
- Cash-advance fees. Using a business credit card at an ATM (or other cash-advance access point) is like flicking a match onto a powder keg. Fees and high APRs — with interest that starts accruing immediately — are a combustible combination.
- Foreign transaction fees. Four out of the five cards we identified as top picks based on their cashback rewards charge foreign transaction fees that average around 3%. NBD for some businesses, but a costly extra if you rely on foreign vendors or use the card in foreign lands.
- Rewards spending caps. The term “spending cap” is a bit misleading. What’s really capped is the rewards rate — how much you can earn on purchases in the bonus cashback tiers. Once you hit the monthly, quarterly or annual allowance, subsequent purchases are rewarded at a lower rate, typically a flimsy 1%. Bigger businesses with multiple employees using cards can bump up against this ceiling pretty quickly.
- Fewer cardholder protections. Business credit card issuers are not bound by the same consumer protection laws that went into effect with the CARD Act of 2009, although some may apply them voluntarily. For example, there’s no requirement to provide at least 45 days of advance notice for any interest rate increases. Companies are also free to apply card payments to balances with the lowest interest rate first (thus extending the cost and timeframe of debt payoff). Also missing are caps on some fees. As with most things, the fine print in the card’s terms and conditions reveals all.
investor.com quick tip: What type of rewards card should I get for my business? A cashback card is easiest to manage: no points to track or strategic juggling of cards when buying supplies for your business. Plus, you can choose whether to funnel the money back into your business empire or use it for thrice-daily lattes to power through your busy days.
Our mission at investor.com is to provide thorough and unbiased reviews of financial products and service providers. The results from the investor.com Business Credit Card Calculator are based solely on data, and not advertiser dollars. None of the issuers pay for preferential placement in the results list.
This version of the investor.com Business Credit Card Calculator includes cashback business credit cards that charge no annual fee, waive the annual fee under certain conditions, or are free to existing customers (e.g., the Costco Anywhere Visa Business Card by Citi). Cards are listed in descending order according to how much each program would pay out in cashback rewards each year based on the spending inputs you enter.
To calculate the amount of cash back you could earn per year per $1 spent for each business credit card, we factor in:
- Reward dollar value: Credit card companies often express rewards payouts as a percentage (such as 1.5% of every dollar spent) or on a points basis (like 1.5 points for every dollar spent). We converted these to a dollar amount to make it easier to compare programs.
- Reward tiers: Some business cards pay a flat cashback rate on all purchases. Others pay higher cashback rates on purchases that fall under specific spending categories. The investor.com algorithm incorporates each issuer’s unique reward’s program to determine the “Cash Back Per Year” tally.
- Spend categories: Based on the rewards cards in our database, gas, dining, travel, office supplies, and cell phones are the categories most often used by business credit cards that feature tiered rewards programs. (Note that these are slightly different spend categories than cashback cards aimed at consumers.)
- Monthly spend: The default dollar amounts for each spend category in the Business Credit Card Calculator are based on average small-business spending data from the U.S. Bureau of Labor Statistics and other sources. Click the arrow on the “Spend Categories” to customize the monthly spend inputs and find the business card with the highest payout rate for your small-business spending.
What’s not included in the “Cash Back Per Year” total:
- The cash value of any sign-up/introductory bonus: Welcome bonuses are highlighted at the top of each card writeup, but are not included in the “Cash Back Per Year” total. While sign-up bonuses can be the most lucrative part of getting a new business credit card with rewards, applicants do not automatically earn this extra cash. (It requires charging a minimum amount during a specified time period after card activation.) For more information about welcome bonus requirements for the cards that offer them, click “Card Deets” on the individual card reviews.
- Rewards spending caps: Some cards have rewards spending caps wherein purchases that exceed a certain dollar amount are subject to a lower default rewards rate, usually 1% or 1.5%. We point out in the individual credit card reviews any monthly, quarterly or annual spending caps that may affect the amount in rewards you can earn. (A future version of this calculator will automatically factor rewards spending caps into the results.)
Other data points we collect on each rewards card include:
- Fees (annual, balance transfer, cash advance, late/returned payment, foreign transactions).
- Reward redemption options.
- Introductory APRs and terms for purchases and/or balance transfers; minimum and maximum APRs, regular APRs.
- Card perks, quirks, and our own take on the merits of each card.
Note: Issuers regularly update credit card offerings and terms. We strive for perfection on these pages and conduct regular data audits to ensure accuracy. But occasionally an actuary at one of the issuing banks deigns to move a decimal point on a balance-transfer APR without a courtesy heads-up. To prevent unconscionable incidents like this from ruining your day, too, we include links in each business credit card review to the offer and terms and condition sheets.
Drop us a line: We regularly add new cards to our database. Let us know if there’s a credit card rewards program you’d like to see included by emailing email@example.com.
Explore our other reviews:
- Cashback Credit Cards Calculator
- Costco Anywhere Visa Card by Citi Review
- PayPal Cashback Mastercard Review
- Top Financial Advisor Firms
- Best High-Yield Savings Accounts
About the author:
Dayana Yochim has been writing (articles, books, podcasts, stirring speeches) about personal finance and investing for more than two decades, focusing on bringing clarity and the occasional comedic aside to what is often a murky, humorless topic. She’s written for NerdWallet, The Motley Fool, HerMoney.com, Woman’s Day, Forbes, Newsweek and others, and been a guest expert on The Today Show, GMA, CNN, NPR and wherever they’ll hand her a mic. Read more about Dayana
About the editor:
Carolyn Kimball is Managing Editor for Reink Media Group and the lead editor for content on investor.com. Carolyn has more than 20 years of writing and editing experience at major media outlets including NerdWallet, the Los Angeles Times and the San Jose Mercury News. She specializes in coverage of personal financial products and services, wielding her editing skills to clarify complex (some might say befuddling) topics to help consumers make informed decisions about their money. Read more about Carolyn.