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Table of Contents
- How do business credit cards for travel work?
- Business credit cards for travel fees
- Are there fee-free business credit cards for travel?
- Best business credit cards for travel
- Advantages of business foreign use credit cards
- Disadvantages of foreign use business credit cards
- How to apply for a business credit card for travel
Some business credit cards have been explicitly designed for travel. They may even come with additional rewards – like cashback and the ability to earn rewards points.
But not all foreign use business credit cards are created equal. Some offer low or no fees for spending overseas in Europe but come with higher fees for spending in the rest of the world.
And there are others on the market which are completely free of foreign transaction fees no matter where in the world you’re traveling (and spending).
If you travel a lot for your business or spend money abroad, consider getting a business credit card with low or even no overseas transaction charges – letting you spend fee-free wherever your business takes you.
But make sure you don’t lose sight of interest rates and annual card fees when weighing up which foreign use business credit card is best for you and your business.
How do business credit cards for travel work?
By and large, business credit cards for travel work in much the same way as other business credit cards and personal credit cards.
Assuming you are approved for a card, you’ll be able to use your shiny new foreign use business credit card for things like paying invoices, covering travel expenses, and buying equipment for your business.
At the end of each statement period, you’ll be sent a statement showing your balance – or how much you owe on the card.
If you just pay off the minimum amount, you’ll be charged interest on the rest. Alternatively, you can pay off your business credit card in full each month, which saves you from having to pay interest.
It’ll always be cheaper in the long run to pay off your business credit card in full and on time each month.
Business credit cards for travel fees
The main difference when using your business credit card abroad is the fees you are likely to incur.
Many UK business credit cards charge foreign transaction fees when spending in any currency other than Sterling.
Overseas spending fees vary from one business credit card to the next, but in some cases they could amount to almost 3% of the value of your foreign transactions.
This means you could end up paying almost £3 in fees for every £100 you spend on your business credit card while you’re abroad.
In fact, if your credit card isn’t specifically tailored towards overseas spending, then your next business trip could quickly rack up hefty fees – and that’s on top of your business credit card provider’s currency conversion fee.
Additional fees you could incur while spending abroad include commission charges, interest on cash withdrawals, and foreign currency ATM withdrawal fees.
ATM withdrawal fees could be in the region of 3% of the withdrawal amount or £3 – whichever is higher. They are charged on top of the currency conversion fee, meaning a £100 withdrawal overseas could end up costing you over £106, when fees are factored in.
Are there fee-free business credit cards for travel?
While many UK credit cards charge various fees for overseas use, there are some business credit cards on the market which have no foreign transaction fees.
Bear in mind, however, that some of these cards come with annual fees for holding the card – and some are only fee-free in certain overseas territories.
Before you apply for a business credit card with no or low overseas transaction fees, make sure the small print covers the countries and currencies you’re planning to spend money in.
And at the same time, make time to weigh up whether potential savings on transaction fees might be outweighed by other fees associated with using or holding the card.
Best business credit cards for travel
The key difference between foreign use business credit cards and other kinds of business credit cards is that foreign use cards are geared towards overseas spending.
Some business credit cards may entail hefty fees for spending overseas or in a foreign currency, whereas foreign use business credit cards generally have lower fees for spending when abroad.
If you travel a lot for your business – and spend a reasonable amount of money overseas – then a foreign use business credit card with low (or no) fees for overseas spending may be the best fit for your business.
Bear in mind that foreign use credit cards may come with different fees for different territories. For example, a card may be fee-free for spending in Europe but may entail foreign transaction fees when used further afield.
And when deciding on the best foreign use business credit card for your business, don’t forget to weigh up all aspects of the card: including interest rates and whether the card comes with valuable perks and rewards.
See the table below for the top 10 business credit cards for use overseas by representative APR – the interest rate that most customers will receive when applying for a credit card.
Provider | Representative APR | Foreign use scenario – Year 1* | Foreign use scenario – Year 2 | Using card in Europe charge | Using card worldwide charge | |
|---|---|---|---|---|---|---|
 | 15.95% | £88.50 | £120.50 | 2.95% | 2.95% | |
 | 15.95% | £120.50 | £120.50 | 2.95% | 2.95% | |
 | 18.9% | £44.85 | £44.85 | 0% | 2.99% | |
 | 21.8% | £106.50 | £106.50 | 2.75% | 2.75% | |
 | 22% | £89.70 | £121.70 | 2.99% | 2.99% | |
 | 22.4% | £88.50 | £116.50 | 2.95% | 2.95% | |
 | 23.70% | £0 | £0 | 0% | 0% | |
 | 24.3% | £118.50 | £118.50 | 2.95% | 2.95% | |
 | 25.7% | £107.50 | £107.50 | 2.75% | 2.75% | |
 | 27.10% | £59.70 | £59.70 | 2.99% | 2.99% |
*This calculates the combined cost of £1,500 spending in Europe, £1,500 of spending outside Europe, and the annual fee (in the first year). Typically, business credit cards that offer foreign functionality can also be cards that offer rewards, so the amount shown is minus the reward value of £3,000 spending in the first year. The next column calculates this after the first year.
Royal Bank of Scotland (RBS), another brand within the NatWest Group, offers a similar business credit card to NatWest in Scotland. Yorkshire Bank, a trading name of Clydesdale Bank, offers a business credit card at the same rate as Clydesdale. It’s worth noting that specific terms may vary.
Missed or late payments can lead to increased debt and negatively impact your credit rating.
This table is checked and updated regularly. We aim to provide accurate information but prices, terms and conditions of products and offers can change, so double-check first. Business credit card data is provided by Fairer Finance.
Advantages of business foreign use credit cards
Cheaper overseas spending
Because foreign use business credit cards are designed to be used abroad, you can expect to pay lower fees for overseas spending compared to other business credit cards.
In the long run, choosing a business credit card with no or low fees for overseas spending could save your business money. Just make sure you weigh up the benefits of these savings with any other fees associated with the card.
Help with cash flow
Business credit cards – including cards designed for fee-free overseas spending – can ease the cash-flow pressure on your business by letting you spread the cost of big purchases.
Be warned, however, that if you don’t pay off the entirety of your outstanding balance at the end of a statement period, you will be charged interest on what you owe.
Perks and bonuses
Some business credit cards with 0% fees for overseas spending may also come with other benefits or perks.
There are business credit cards on the market which not only offer fee-free overseas spending but which also provide cashback or access to reward points.
In some cases, these reward points can be converted into airline loyalty points, potentially allowing you to save even more on future business trips.
Boost your business credit score
Whether it’s a foreign use card or not, using a business credit card responsibly and paying off the balance in full every month shows that your business is a reliable borrower.
In this way, using a business credit card can improve your business credit score, which may make it easier to access business finance on better terms down the road.
Separate your finances
By keeping all your business spending on a business credit card, you can clearly separate your personal and business finances – just like how using a business bank account can put a barrier between your personal and business finances.
This will allow for simpler accounting and makes it easier to see, at a glance, the state of your finances.
Disadvantages of foreign use business credit cards
Annual fees
Some business credit cards have no overseas transaction fees but make up for this by charging an annual fee to use the card.
Fees vary from provider to provider, and not all foreign use business credit cards have annual fees.
You’ll have to consider what you want from a business credit card, as well as your own business circumstances – including how much money you expect to spend overseas – when deciding which foreign use credit card is best for your business.
Higher interest rates
If you don’t pay off the entirety of your credit card statement balance on time, every month, then your business will have to pay interest on anything you still owe.
As a general rule, business credit cards tend to come with higher interest rates than personal credit cards or business loans, which are likely to be a better option for longer-term business borrowing.
Personal guarantees
You’ll generally be required to provide a personal guarantee before your business is approved for a business credit card – including cards with no overseas transaction fees.
A personal guarantee is a legally binding agreement which means that you, personally, will become responsible for paying any debts owed by your business if your business is unable to pay.
Credit score requirements
Your business credit score will play a role in determining whether you’re approved for a business credit card.
Your business credit score is distinct from your personal credit score, representing a measure of how reliable your business is at paying back its debts.
If your business is new or a start up, your own personal credit score may be considered, since your business won’t have had a chance to build up a credit score of its own.
How to apply for a business credit card for travel
Once you’ve shopped around, compared business credit cards, and settled on the foreign use credit card which best suits your business, you can apply directly to the credit card provider.
You will need to provide various personal and financial information as part of your application, as well as information about your business. You may also be required to provide a personal guarantee.
Any prospective lender is likely to carry out a so-called “hard” check on your business or personal credit file. “Hard” credit checks can temporarily harm your credit score, so it’s best to avoid applying for multiple lines of credit in quick succession.
Assuming you meet the card provider’s eligibility requirements, and assuming you are approved, you will then be sent your new business credit card in the post.
» MORE: Do I need a credit card?
Image source: Getty Images
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