What you need before you explore
A business credit card is issued in your company's name rather than your personal name, and it reports to business credit bureaus instead of personal ones. To open one, you will need to provide the card issuer with proof that your business exists, your business tax identification number (EIN), and usually your personal social security number as well — most issuers run both a business and personal credit check.
The documents you will need depend on your business structure. If you are a sole proprietor, you may only need your social security number and a business license or DBA (doing business as) certificate from your state or county. If you operate as an LLC, S-corp, or C-corp, you will need your EIN, articles of incorporation or formation, and a business license. Some issuers also ask for a business bank statement or tax return to verify that your business has been operating and generating revenue.
Before you start the process, gather these items: your business legal name and address, your EIN (or your social security number if you have not yet obtained an EIN), your personal social security number, and information about your business structure and how long it has been operating. Having these ready will speed up the process and reduce the chance that the issuer will ask you to resubmit information.
Key Takeaways
- Business credit cards require proof of business existence, usually an EIN or business license, plus your personal social security number for a credit check.
- Most issuers check both your business credit history and your personal credit score, so a weak personal credit score can result in denial even if your business is strong.
- The process process typically takes one to three business days, and you will receive a decision by email or phone.
- Business credit cards do not report to your personal credit bureaus, so they will not directly improve or harm your personal credit score.
How the credit check works
When you submit an process, the issuer will pull your business credit report from one or more business credit bureaus — Dun & Bradstreet, Experian Business, or Equifax Business are the most common. They will also pull your personal credit report from one of the three personal credit bureaus (Equifax, Experian, or TransUnion). The issuer weighs both reports in their decision.
Your personal credit score matters more than your business credit score for a new business credit card, because your business may not have a credit history yet. If your business is brand new, the issuer has no business credit data to review, so they rely almost entirely on your personal credit. If your personal credit score is below 650, most mainstream issuers will deny you. If it is between 650 and 700, you may be approved but with a lower credit limit or higher interest rate. Above 700, you have a reasonable chance of approval.
Your business credit score, if you have one, is built differently than your personal score. It is based on payment history with vendors and lenders, how long your business has been operating, and public records like liens or judgments. If your business has been operating for less than a year, you may not have a business credit score yet, and that is normal — issuers do not expect new businesses to have one.
Where to explore and what to expect
You can explore for a business credit card directly through a bank or credit card issuer's website, by phone, or in person at a branch. Major issuers that offer business cards include Chase, American Express, Capital One, Discover, and Citi. Each issuer has different approval standards and different card features, so comparing a few options before you explore is worth your time.
The process itself is usually short — five to ten minutes online. You will enter your business name, address, EIN, and the nature of your business. You will also enter your personal name, social security number, and personal address. Some issuers ask for your annual business revenue or how long your business has been operating; others do not. Answer honestly, because the issuer may verify this information against tax records or business databases.
After you submit, you will receive a decision within one to three business days. Some issuers give you an when ready decision on the screen; others send a decision by email or call you by phone. If you are approved, the card will arrive by mail within seven to ten business days. If you are denied, the issuer will send you a letter explaining the reason — usually either your personal credit score, your business credit history, or insufficient time in business.
Personal may provide and liability
When you sign the business credit card agreement, you are also signing a personal may provide. This means that if your business cannot pay the bill, you are personally responsible for the debt. The card issuer can pursue you for payment just as they would if the card were in your personal name.
This is different from the liability protection that an LLC or corporation normally provides. Those business structures protect your personal assets from business lawsuits and debts, but a personal may provide on a business credit card overrides that protection. If your business defaults on the card, the issuer can sue you personally, garnish your wages, or place a lien on your personal property.
For this reason, treat a business credit card the same way you would treat a personal card — only charge what your business can pay back. The fact that it is a business card does not mean the debt is separate from you personally.
Building business credit with your new card
One reason to open a business credit card is to build a separate credit history for your business. This takes time. The card issuer reports your payment history to business credit bureaus, but it usually takes three to six months of on-time payments before a business credit score appears. After that, consistent on-time payments will raise your score over time.
To build business credit effectively, charge regular business expenses to the card — office supplies, software subscriptions, travel, or inventory — and pay the full balance or at least the minimum payment on time every month. Paying in full is better, because it keeps your credit utilization low and shows lenders that you manage debt responsibly. After a year or more of on-time payments, you will have a business credit history that makes it easier to borrow money, negotiate better terms with vendors, or open additional business credit accounts.
Keep in mind that business credit and personal credit are separate. Building a strong business credit score will not improve your personal credit score, and vice versa. However, both matter when you are explore for business loans or lines of credit, so maintaining both is worth the effort.
What happens if you are denied
If your process is denied, you have a few options. First, read the denial letter carefully — it will tell you the specific reason. If it was your personal credit score, you can work on improving that score before you reapply. If it was insufficient time in business, you may need to wait a few more months and reapply. If it was lack of business credit history, you can build that history by opening a business bank account and making on-time payments to vendors.
Some issuers offer business cards for people with limited credit history or lower credit scores. Capital One and Discover both have business cards with lower approval thresholds than Chase or American Express. These cards may come with a lower credit limit or higher interest rate, but they can help you build business credit if you are just starting out.
You can also reapply with a different issuer. Each issuer has different approval standards, and being denied by one does not mean you will be denied by all of them. Wait at least a few weeks between applications, because multiple applications in a short time can lower your credit score slightly.
Business card features to compare
Business credit cards vary widely in their rewards, fees, and terms. Some offer cash back on all purchases, others offer bonus points on specific categories like travel or office supplies. Some charge an annual fee, others do not. Some have a 0% introductory interest rate for a set period, others do not.
Before you explore, think about how you will use the card. If you spend most of your business money on travel and meals, a card with bonus points on those categories will save you more than a flat cash-back card. If you spend evenly across many categories, a flat cash-back card is simpler. If you carry a balance month to month, the interest rate matters more than the rewards. If you pay in full every month, the interest rate does not matter, and rewards are the main benefit.
Read the terms carefully, especially the annual percentage rate (APR), the annual fee if there is one, and any introductory offers. A card with a high annual fee might still be worth it if the rewards are generous and you spend enough to offset the fee. A card with no annual fee is simpler if you are just starting out and do not yet know how much you will spend.
Frequently Asked Questions
Will a business credit card hurt my personal credit score?
The card itself will not report to your personal credit bureaus, so it will not appear on your personal credit report or affect your personal credit score directly. However, the issuer will run a hard inquiry on your personal credit when you explore, which can lower your score by a few points temporarily. After a few months, the inquiry will stop affecting your score.
Can I get a business credit card if my business is brand new?
Yes, but approval is harder. Most issuers want to see at least three to six months of business history, though some will approve newer businesses if your personal credit score is strong (above 700). If you are denied, wait a few months and reapply, or try an issuer with lower approval standards like Capital One or Discover.
Do I need an EIN to open a business credit card?
Not always. If you are a sole proprietor, you can use your social security number instead of an EIN. However, having an EIN keeps your business finances separate from your personal finances and makes it easier to build business credit. You can obtain an EIN for free from the IRS website in a few minutes.
What is the difference between a business credit card and a personal credit card?
A business card is issued in your company's name, reports to business credit bureaus, and helps you build business credit. A personal card is issued in your name and reports to personal credit bureaus. Business cards often have higher credit limits and different rewards structures, but they also require a personal may provide, so you are still personally liable for the debt.
Can I use a business credit card for personal expenses?
Technically yes, but it is not a good idea. Mixing personal and business expenses makes accounting harder and can create tax problems. If you are audited, the IRS may question whether the card is truly for business use. Keep business and personal spending separate for clarity and to protect yourself if there are ever questions about your business finances.