Getting a business credit card for a new business, startup or side hustle is easier than you may think. You don’t need a business plan, or even any business income; if you have good personal credit (a FICO score of 690 or higher) you can qualify for most business credit cards.
Here are the steps to take, and what you’ll need, to get a credit card for your new business or startup.
1. Research and choose a business credit card
The best business cards for startups generally combine flexibility with perks and bonuses. Start by researching your options and selecting a card that matches your needs and spending patterns. Planning a lot of business travel? A business travel card that earns you points or miles on flights, hotels and rental cars can help finance future trips and make travel more comfortable, with perks like lounge access and free checked bags. Not sure what your spending will look like? A cash-back business card with no annual fee is a great option for new businesses figuring out their expenses — bonus points if the card has a generous welcome offer.
2. Understand the personal guarantee
Almost all business credit cards require a personal guarantee. This means that if your new business fails, you’ll be on the hook for any balance, and the credit card issuer can go after your personal assets. This is the case even if your business structure otherwise protects you from liability for company debts, as with a corporation or LLC.
Not comfortable signing a personal guarantee? Startups with professional investors or a healthy bank balance can consider a corporate card like Ramp or Brex. These cards rely on your business financials, rather than your personal credit, for approval. As a result, you’ll need at least $50,000 in a business bank account to qualify. Corporate cards are not available to unincorporated businesses, like sole proprietors.
3. Gather your application information
Tax ID number: If you don't have a separate tax ID for your business (and many entrepreneurs don't), you can use your Social Security number.
The business's name: If your new business has a legal name, put it here. If not, put down your own name instead.
The legal structure/entity type: Sole proprietorship, corporation, partnership or LLC.
Business address and phone number: Use your home address and personal phone number if you don’t have a separate business line or location.
The date you started your business: This one is pretty straightforward.
Type of industry: This is "what you do" in your business, such as transportation, construction or general services, for example.
You’ll also need to provide personal information — name, address, date of birth and Social Security number — for yourself and any individuals who own 25% or more of the business.
4. Start building business credit
Opening a small-business credit card can be a first step toward establishing business credit for your new company. Similar to personal credit, a strong business credit score can unlock better rates and terms on loans, as well as on business insurance and with suppliers. Most business cards report activity to business credit bureaus, like Dun & Bradstreet. On time, and even early payment, can help you build business credit. Negative activity — like a serious delinquency — is often reported to consumer credit bureaus as well. So failing to pay your business card can hurt your business and personal credit.