New business owners often fund their ventures with personal capital, which includes savings, loans, and credit cards. Without established business credit, companies sometimes have a hard time finding business credit cards they can qualify for. I’m often asked about the best business credit cards for startups, so I wanted to do a write-up to share with everyone.
Here’s what’s covered:
- Startup Business Credit Basics
- Best Corporate Credit Cards for Startups
- Best Travel Rewards Credit Cards for Startups
- Best Cashback Credit Cards for Startups
- Final Thoughts
Keep reading to learn everything you need to know.
Startup Business Credit Basics
A business has its own credit scores, different from FICO scores. Before a business can qualify for a credit card, it must build business credit, which is separate from personal credit. A company must form their business in a way that sets them up to become “business credit ready,” network with banks, establish business credit profiles, then build small tradelines of credit. When they make the right moves, they can generate high credit scores and qualify for large lines of credit.
Companies without business credit can get credit cards, but are often limited by personal credit.
Secured vs Unsecured Credit Cards
There are several categories of credit cards available for businesses and individuals: secured and unsecured. Secured credit cards are designed for companies and people who want to build or repair credit by reporting responsible payment history. Unfortunately, secured credit cards require a deposit, essentially allowing you to spend your own money in exchange for reporting on-time payments to credit bureaus.
On the other hand, unsecured credit cards extend deposit-free lines of credit to companies and individuals based on existing merit. Unsecured cards are typically available to those with moderate to excellent credit history. The higher the credit score, the more card benefits and higher limits a business or person can usually qualify for. Here, we’re going to talk only about unsecured credit cards for startups.
Corporate vs Travel Rewards vs Cashback Card
Companies usually turn to credit cards to manage cash flow. Another top reason to use credit cards for business spending is to save and earn. Ideally, you want to pay off your card balance each month to avoid interest payments and cash in on the available discounts and rewards.
- Corporate cards help large companies manage employee spending and offer savings with high profile partners.
- Business travel cards are designed for companies that want to earn travel rewards like airline miles, free hotel stays, and more.
- Business cashback cards provide rewards in the form of points that can be redeemed as cash to a bank account, applied toward a statement balance, or redeemed for other items.
So, when you explore which card is right for you, first decide which you’re more interested in. Then, proceed through this list accordingly.
What is the 5/24 Rule?
One last item to note before we move on to explore the cards listed here is Chase’s “5/24 rule.” All card issuers have provisions that, if not met, can immediately disqualify you from the ability to obtain a card. Chase has a black and white rule that if you have opened five or more personal credit cards within the past 24 months, you cannot open a new credit card account with them.
So, if you want to apply for a Chase credit card, start with them before you move on to other banks.
Best Corporate Credit Cards for Startups
Typically, corporate cards have lower risk to you as the business owner because they require no personal guarantee. But, they can be trickier to qualify for. Qualification terms are instead based on a company’s financial track record and proven ability to pay back funds. Right now, there are some impressive names in the corporate card game; here are the four top corporate cards for startups, none of which charge fees.
1. Brex
Read more about the Brex corporate card.
2. Stripe
Read more about the free Stripe Corporate Card’s cashback rewards.
3. Divvy
Read an in-depth Divvy credit card review before you apply.
4. Ramp
Learn more about the Ramp card.
Best Travel Rewards Credit Cards for Startups
Now, let’s take a look at the best startup business credit cards for the best travel rewards and sign on bonuses that I know of.
1. Amex Marriott Bonvoy Businesses
Read a Marriott Bonvoy Business credit card review and comparison.
2. Barclay American Airlines AAdvantage Aviator Business
Learn more about Barclay’s AA Biz card.
3. Bank of America Alaska Airlines Business
Learn more about the BoA Alaska Biz card.
4. CitiBusiness American Airlines AAdvantage Platinum
Learn more about the CityBiz AA Platinum card.
Best Cashback Credit Cards for Startups
Now, these cards can help you manage cash flow while you earn as much as possible on spending for your startup.
1. Capital One Spark Cash Small Business
Learn more about the Capital One Spark Cash card.
2. Chase Ink Business Preferred
Read a deep dive into the Chase Ink Business Preferred card.
3. US Bank Business Leverage
Learn more about the US Bank Biz Cash card.
4. Wells Fargo Business Platinum
Read more about Wells Fargo business lines of credit before you apply.
Final Thoughts
These are the top business credit cards for startups, including corporate, travel rewards, and cashback options. We’ve written in-depth reviews on a handful of additional business credit cards you might also find interesting:
- PNC Bank Business Credit Card Review & Comparison
- We Studied Suntrust Business Credit Cards & Here’s What We Found
- How to Get a Business Credit Card — The Ultimate Guide
And, if you’re ready to learn how to get $100K in business credit in 30 days, join Business Credit Workshop today!