Business Credit Cards may be an incredible multi-use option for businesses. They can help transfer balances from other more expensive debts, increase your credit score substantially, and even have additional travel and cash-back benefits. Credit cards can be your worst enemy or your best friend, it's all about knowing how to work the system, and that's what we're here for.
(Without affecting your credit!)
A business credit card and personal credit card operate similarly. They both offer insentives and benefits such as points, travel, and introductory APR options, but they are regulated somewhat differently. That means there can be different terms and conditions for business cards and personal cards, and a savvy credit card shopper needs to understand those differences before they apply. First, let’s review how business and personal credit cards are similar.
Whether it is by swiping, a chip, or using your credit card number, business credit cards can be used to make purchases in person or online just like you would with a personal card. They usually share the same security mechanisms such as the CVV code or expiration dates.
While it is a business credit card, it will still require that the owner of the card remain liable for that debt. Personal guarantee means that you would have to personally take care of late payment fees or unpaid debt; regardless of the business' condition.
The application process may also be different according to your credit score. The lower your credit score, the more financial documentation will you have to share. This includes tax-returns statements, financials, and other forms of proof. That's why in any case, it's extremely useful to have your credit score and financial reports in check.
Personal credit cards will almost always report to all three consumer credit report bureaus (Equifax, TransUnion, Experian). Business credit cards will not report to any of these except for situations like a default.
Personal credit card options are more heavily regulated and therefore you may find less flexibility in interest rates charged or ways that debt can be collected. You may find a larger variety of business credit card options; however, by and large most credit card companies have self-regulated and use similar policies as those with personal cards.
All personal credit cards that are issued fall under the federal Fair Debt Collection Practices Act (FDCPA), which aims to regulate third-party debt collection practices to protect the consumer. However, most business credit cards don't fall under FDCPA for it being classified as business debt. For this reason, third-party debt collector may be more aggressive with said debt collection.
The application process of business credit cards is quite simple, since you only have to apply once with us to receive multiple offers by multiple issuers. You can easily apply by filling up our quick 5-minute application and sending in your current personal credit reports from all three bureaus.
Your advisor will go over your documents and if there’s any information missing they will be in touch shortly.
You can find the application by clicking here.
Virtually all industries can benefit from business credit cards. Some more than others, but given this product provides such flexible use-cases, opportunities arise in any situation.