What to Look for in a Business Credit Card

A business credit card is a specialized type of credit card issued to a business entity rather than an individual. These cards are designed to help business owners manage company expenses, cash flow, and even earn rewards specific to business needs. They often come with higher credit limits and business-centric benefits compared to personal credit cards.

Common Features of Business Credit Cards

• Higher Credit Limits: Business credit cards typically offer higher credit limits to accommodate the larger operational expenses of businesses.
• Rewards and Cash Back: Many business credit cards offer rewards programs tailored to common business expenses, such as office supplies, travel, telecommunications, and advertising. Rewards can come in the form of points, miles, or cash back.
• Expense Management Tools: These cards often provide detailed reports and tools to track and categorize expenses, making it easier to manage budgets and prepare for tax season.
• Employee Cards: Business credit cards usually allow the addition of employee cards, which can have custom spending limits and earn rewards for the main account.
• Introductory Offers: Many cards come with introductory offers such as 0% APR for a set period or bonus rewards points for meeting certain spending thresholds within the first few months.
• Travel Benefits: For businesses that require travel, some cards offer travel-related perks like free airport lounge access, travel insurance, and no foreign transaction fees.

Key Considerations for Choosing a Business Credit Card

• Fees: Understand all potential fees, including annual fees, late payment fees, and foreign transaction fees. Sometimes, the benefits can outweigh the cost of an annual fee.
• Interest Rates: Look at the APR (Annual Percentage Rate) for purchases and cash advances, especially if you anticipate carrying a balance.
• Rewards Program: Evaluate the rewards structure to ensure it aligns with your most common business expenses. Consider how you can redeem points—whether for travel, cash back, or other rewards—and any limitations.
• Credit Limit: Ensure the card’s credit limit meets your business’s spending needs without straining your cash flow.
• Introductory Offers: Evaluate introductory APRs and bonus offers but understand what the terms will be after the introductory period ends.
• Additional Perks: Consider the value of additional perks like insurance coverage, purchase protection, and extended warranty services.
• Integration with Accounting Software: Some cards offer seamless integration with accounting software, simplifying expense tracking and reporting.
• Personal Guarantees: New companies like Brex and Ramp are coming out with business cards that don’t require personal guarantees. Instead of relying on the credit score of the business owner, they look at the health and business model of the business itself. 

Different Types of Business Owners:

• Startups and Small Businesses: May prioritize cards with low fees and robust expense tracking tools to manage tight budgets and cash flows efficiently. Introductory 0% APR offers can also be beneficial for businesses planning initial large purchases.
• Businesses with Frequent Travel: Should look for cards offering travel rewards, no foreign transaction fees, and travel insurance. Perks like airport lounge access can provide added value.
• High-Spending Businesses: Businesses with high monthly expenses might prioritize cards with high credit limits and tiered rewards programs that offer greater rewards for higher spending.
• E-commerce Businesses: Might prefer cards that offer rewards for online advertising and shipping expenses, along with enhanced online fraud protection.

Choosing the right business credit card involves assessing your business’s specific needs, spending patterns, and financial goals. It’s important to read the fine print, understand the terms and conditions, and consider how each card’s features align with your business operations.

Top Credit Cards for Start Ups and Small Businesses