Business credit cards are similar to personal cards. You can buy things for your business before you have the money. If you don’t pay in full by the due date, interest is added.
Just like a regular credit card, you can pay monthly. This lets you buy supplies and necessities for your business. This can replace a business loan in some scenarios.
Many businesses use credit cards for everyday items. Soap, paper, office supplies, and more can go on credit cards. Some people use credit to buy the technology their business needs.
If your business sells items, you can use credit to pay your wholesaler. This keeps you afloat until you have a profit from the sales.
Best Business Credit Cards
All credit cards are different. It’s important to research to choose which card is best for you. In addition, different types of businesses will benefit from different cards.
For Startups
Startups and new businesses are often financially limited. For this reason, find a card with low or no annual fees. This will help new companies stay on budget.
High rewards for business expenses can be helpful too. Startups have significant costs up front. Making large purchases can help rewards accumulate fast.
Be sure to pay attention to interest rates, too. If you don’t have profits yet, you can’t pay right away. Then, high interest rates could deplete your resources.
There are many options that meet this criteria.
For Entrepreneurs
Entrepreneurs need to look for the same criteria as startups. This is because new businesses and startups have similar priorities. Look for cards with low fees and high rewards.
Consider what kind of rewards will benefit your business. Some companies benefit from travel perks from airlines. Others prefer cash back
Sit down and consider your budget and needs. Prioritize these when shopping for a business card.
For One Person Companies
One person companies can benefit from high reward cards. Because they spend less, more rewards can make the card worthwhile. Good rewards can also help cover costs.
One person companies, startups, and entrepreneurs are similar in this way. These small businesses benefit from multiple types of perks. They should also seek cards with low fees.
For Small Businesses with Less than 5 Employees
Small business owners need to organize finances just like larger businesses do. You’ll want to find a card that allows expense tracking. Cash back and perks that pertain to your business are also key.
Find a card that has a low introductory APR. Paying less interest per year when you’re making large purchases is ideal. Cards that offer cash back can help you cover additional costs.
Can I Get a Card?
Fortunately, most new business owners can get credit cards. A new line of credit can help with upfront expenses. This can make sure your business starts on the right foot.
Many banks offer business cards. If you are a new business, you can still apply for these cards. You do not need to be established to apply.
Your business profits aren’t necessarily important. If you’re just starting out, you could get a card without revenue. The bank will simply look at your personal credit score.
Some businesses prefer lines of credit over loans. Business loans can be hard to get, and have more restrictions. Business credit cards offer perks and more flexibility.
In order to get a card, you need a business address. However, some new businesses apply for credit before getting an address. In this case, you can use your home address.
What Kinds Of Credit Limits Are Available?
Personal and business credit cards are different. Personal cards have fairly low limits, depending on your credit score. Business credit limits are usually much higher.
The average credit limit for a business card is $56,100. The limit is high to account for startup expenses. This allows businesses to buy products and supplies before they make profits.
With a large credit limit, most businesses can afford rent and employees. Without this, entrepreneurs would need to foot the bill at the beginning. This isn’t possible for many people.
You could get a higher credit limit with a high credit score.
Remember, this is a revolving balance. Your limit is the maximum you can spend at any time.
How To Get a Business Credit Card for an LLC
Getting a credit card for your LLC is not complicated. In fact, it’s similar to getting a personal card. Follow these steps:
Check Your Credit Score
Your credit score will determine your business’s limit. This is because you will pay your business’s credit card. Banks need a high personal credit score to give businesses a high limit.
Thus, if your credit score is good, your LLC gets more credit. If it’s low, your LLC may suffer as a result. If you sign with a partner, their credit score matters too.
Research Potential Cards
After you check your score, research potential cards. All cards are different. Look for one that fits your LLC’s needs.
Some cards have perks and rewards while others don’t. Some cards have fees while other cards do not. Consider how these characteristics fit your LLC’s needs.
Apply
When you’ve selected a card, follow the application instructions. This can often be done online.
Once the application is filled out, you must wait for a response. Usually, banks approve or deny credit cards quickly. This is especially true with online applications.