How to qualify for a small business credit card

A small business credit card can help you manage your cash flow, separate business expenses from personal and more. (iStock)

Getting a small business credit card can be a great way to legitimize your business. Not only do they make it possible to separate your business and personal expenses, but they also help you establish a business credit history, provide some cash flow management tools and more.

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Getting approved for a business credit card isn’t much different from getting approved for a personal credit card. However, there are some differences to keep in mind. For example, while you don’t need an employer identification number (EIN), a number the IRS uses to identify businesses, it can be helpful.

Here’s everything you need to know about getting a small business credit card.

How to qualify and apply for a small business credit card

For the most part, the application process for business and personal credit cards is the same. However, there are some distinct differences to know about.

First, business credit card applications give you the option to include your company’s EIN. This isn’t required, and if you’re a sole proprietor, you don’t need an EIN in the first place. But adding one to your card application allows the card issuer to report your account activity to the commercial credit bureaus, which can help you establish a business credit history.

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Also, if you have multiple businesses, adding the EIN for each can make it possible to get the same card for each company you own.

Most of the best business credit cards require that you have good or excellent personal credit to get approved—that typically means a FICO score of 670 or higher. However, there are also some business cards that are accessible to business owners with bad or fair credit.

Check your credit score before you apply using a free service like Discover Credit Scorecard, then focus on cards that offer good approval odds based on that information.

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Also, keep in mind that some business credit card issuers report your account activity to both the commercial and consumer credit bureaus. Capital One and Discover are the only to major card issuers that do this, but some credit unions and community banks may also do it, so double-check before you apply to avoid having your business finances affect your personal credit.

Can you apply for a small business credit card using only an EIN?

Corporate credit cards allow you to apply only with an EIN, but they typically have high revenue requirements, so they’re not accessible to most small businesses. This means that you’ll likely need to include your Social Security number. While most card issuers won’t report your account activity to the consumer credit bureaus, you’ll be personally responsible for paying off any debt your business can’t, and it may be reported to the credit bureaus if you don’t.

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In addition to your EIN and Social Security number, small business credit card issuers also typically ask about your annual revenue and monthly expenses, as well as information about your (and anyone else’s) ownership in the business. Beyond that, you’ll also need to provide your:

  • Full name
  • Business name
  • Date of birth
  • Address 
  • Contact information

Do you need a small business credit card?

A small business credit card can provide several benefits to your business. In addition to the basic features of separating expenses, improving cash flow management and building a business credit history, many business credit cards also offer rewards on every purchase.

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Also, some provide introductory zero percent APR promotions, which can come in handy if your cash flow is irregular or you want to finance a large expense and pay it off over time. Take your time to pick the right card for your business’ needs.

However, most business credit cards require a personal guarantee, which means that you must pay off the debt with personal assets if your business can’t make its payments. With this in mind, having a business credit card can still be a great way to grow your business. But if there’s a high chance that your personal finances will be at risk because of it, you may want to look into business loans and other ways to manage your company expenses.