10 Reasons to Get a Business Credit Card

Full Disclosure: We may be financially compensated when you click on links to credit card products from our advertising partners, such as American Express, Chase, Citi & Capital One. Opinions and product recommendations on this site are ours alone, and have not been influenced, reviewed or approved by the issuer. See our Advertiser Disclosure for more details. Thanks!

Owning a business can entail a myriad of financial transactions — many of which may require more cash than you have on hand. For that and other reasons, it can be a wise move to apply for a business credit card.

In this article, we’ll discuss 10 reasons why using a business credit card in your business could be favorable for your company.

Why Get a Business Credit Card?

There are several reasons to get a business credit card. Some of the primary benefits of having a company card can include:

1) Access to Cash Flow and Financial Flexibility

Ample cash flow is typically a key priority for business owners, regardless of the size of the company. But having a business credit card can make it much more convenient to keep your expenses in check.

Also, because business credit cards can be much easier to obtain than a traditional loan or line of credit, they can provide a simple way to purchase the equipment, supplies, or inventory that you need.

2) Separation of Personal and Business Expenses

If you own a small company or are a solopreneur, having a business credit card can make it easy for you to separate your personal and business expenses.

Not only can this save you time on a monthly basis, but having 2 separate statements can also make it convenient for record keeping and completing your annual tax return.

Hot Tip: Some business credit cards will even offer online tools that can assist you with tracking your expenses — much easier than saving a year’s worth of invoices and receipts in a physical file!

3) Points, Cash-back, or other Rewards

Just like with many personal credit cards, business cards will often offer points, cash-back, or other nice perks.

For instance, if you have a business credit card that offers travel credits, you could earn discounted (or even free!) airline tickets and hotel stays. This, in turn, can help keep your out-of-pocket expenses down.

Below are some of our recommended business rewards cards:

Ink Business Preferred℠ Credit Card - This is our #1 recommended business card and comes with a whopping 80,000 sign up bonus after you spend $5,000 on purchases in the first 3 months after account opening. This 80,000 bonus is worth $1,000 when you redeem through Chase Ultimate Rewards for travel purchases (e.g flights, hotels, car rentals). Earn lots of points by leveraging bonus categories, and also - if you pay for your cell phone bill with this card, you can get up to $600 in insurance coverage.
Ink Business Cash℠ Credit Card - earn $500 bonus cash back after you spend $3,000 on purchases in the first 3 months after account opening. In addition, get up to 5% cash back on a range of business expenses. A simple, $0 annual fee card.

4) Large Credit or Spending Limit

Often, business credit cards will offer higher credit or spending limits than personal credit cards do. In fact, in some cases, the limits can be in excess of $50,000 or $100,000!

One example of a charge card that can offer high limits is the The Business Platinum® Card from American Express.

Hot Tip: The higher limits on business credit cards can allow you to make purchases that may not have been possible using only the cash your company has on hand.

5) Opportunity to Boost Your Credit Rating

Having a business credit card — and paying off the balance regularly — can help quickly boost your business credit rating, provided that the vendors and suppliers you work with report transactions to the credit bureaus.

6) Advantages over Personal Credit Cards

In many ways, business credit cards can provide you with more advantages over personal credit cards. For example, business cards will oftentimes not only have higher spending limits than personal cards, but these higher limits can make it much easier to make large company-related purchases that you may not be able to make using a personal credit card.

Hot Tip: Don’t miss our piece on How to Maximize Rewards from Your Business Purchases!

7) Keep better control on employee spending

If your business has employees who travel, make purchases of inventory or supplies, or have other responsibilities that require them to spend company money, a business credit card can help you to keep tabs on exactly what they are buying, and how much they are spending.

You could also set spending limits for employee cardholders, based on the amount of credit that is available to spend on the card. Many credit card carriers will offer business credit cards free (i.e., with no annual fee) to a company’s employees.

8) Business Perks

If you have a business credit card that offers rewards, these perks may be business related, such as discounts on business travel, shipping, and business supplies.

Depending on your company’s particular needs, you may even get a credit card that offers rewards on advertising purchases, which could mean more exposure – and ultimately more customers – for your business.

The Ink Business Preferred℠ Credit Card is a rewards card that we put a lot of advertising costs for this site as it earns 3pts per $1 spent on advertising purchases with social media sites and search engines.

Hot Tip: Having a company credit card with business perks can make for a win-win situation, as you could essentially “save” money while spending it.

Some of the business credit cards that offer a variety of perks for business-related needs include <link here to the appropriate cards>.

9) Easier and More Organized Record Keeping

In addition to separating your personal and business expenses, having a business credit card can also make for easier record keeping, which in turn could actually be to your benefit when conducting large company-related financial transactions.

Most business cards will offer some type of online portal or app that can help you with tracking and filing your expenses. This type of convenience can carry over when you are filing your taxes and / or applying for a business loan, because having well-organized records can save you a great deal of time.

On top of that, being able to access your business’s spending records at a moment’s notice can also help to speed up financial transactions, too, and could even allow you to take advantage of opportunities – such as purchasing property and / or inventory – more quickly.

10) Higher Limit Purchase Protection

A business credit card with a higher spending limit may provide you with the ability to make larger purchases, as well as offer higher limit purchase protection. While personal credit cards will oftentimes provide this type of benefit as well, business credit cards can actually cover more expensive purchases. This can give you added peace of mind when making larger, company-related expense commitments.

Qualifying and Applying For A Business Credit Card

There are several different ways that your company can qualify and get approved for a business credit card which we cover in our extensive guide. Even if you’re a very small company (or self-employed) it’s still very possible and typically doesn’t require much (if any) paperwork to get approved.

Final Thoughts

Using a business credit card can offer a number of nice advantages — including the “clout” it can show when you use a card with your company’s name embossed on it, as vs. paying only with cash or check.

The best business credit card for you will depend on a number of factors, such as the size of your company, your priorities – such as cash back, rewards, travel, etc. – and the amount of credit limit that you need.

Before you commit to a particular card, though, be sure that you spend some time reviewing all of its attributes, including the spending limit, purchase protection, online account access, rewards, annual fee, interest rate, sign-up bonuses, and any other features it may have.

In addition, while you may want to collect a variety of business credit cards, it is best if you only apply for those cards that fit your specific situation and objectives, as having too many credit card inquiries may show up as a negative on your company’s credit report.


Featured Image: Courtesy of Shutterstock.com

FAQ

What information do you need to apply for a business credit card?

When you apply for a business credit card, the card issuer will want to know some of your basic personal information, as well as some details about your company, such as your tax or employer ID number and the amount of your annual revenue.

How long does it take to get a company credit card?

Provided that your business credit card application is approved, you can typically expect to receive the card within 10 business days. Once you receive your card, be sure to activate it so you can begin using it.

How can you apply for a business credit card?

There are several ways that you can apply for a business credit card. Depending on the card issuer, you may be able complete a paper application and mail it to the credit card company. You may also be able to apply for a card over the phone or online.

Can you transfer a balance to a business credit card?

Whether or not you can transfer a balance from another card to your new business credit card will depend on the card and the credit card issuer. Once you have a business credit card in place, though, you can contact the issuer and inquire about whether this is allowed, and if so, how to go about moving the balance over.

Susan Wright

About Susan Wright

While writing about finance and insurance isn't something that keeps most people awake at night, it is what Susan Wright has focused on for more than 25 years. As a financial copywriter, Susan has an eye for money-related details such as credit and savings, and she loves to pass along helpful information to consumers. Susan holds 11 financial industry designations (including CLU, ChFC, RHU, REBC, ADPA, CITRMS, CIPA) as well as several licenses.

Disclaimer: Any comments listed below are not from the bank advertiser, nor have they been reviewed or approved by them. No responsibility will be taken by the bank advertiser for these comments.

Any thoughts or questions? Comment below!

Email needed if you'd like comment updates. It will NOT be published.

Advertiser Disclosure

Many of the credit card offers that appear on this site are from credit card companies from which we receive financial compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). This site does not include all credit card companies or all available credit card offers. For more information on our advertisers, see here.