Can you get a business credit card without a business?
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I can’t deny the fact that expanding my credit card arsenal by adding business cards to my wallet has made all the difference in the world. When I got my first business credit card, my life as a business owner suddenly became much simpler. The intro bonus helped me plan business trips when I was tight on cash, it was easier to keep my business expenses separate, I got peace of mind from the purchase protection benefits, and I got great rewards rates for many of my business expenses.
Many of my self-employed friends have told me they would love to get a business card for those same reasons, but don’t believe they qualify because their business is relatively new and/or makes very little income.
So they’re surprised when I tell them that even as a new business without much business income, it is possible to get approved for a business credit card because many banks will consider your other sources of income as well.
In fact, my very first credit card was the Chase Ink Plus (that’s no longer available). I had been in business for less than a year and was approved for the card with just $500 in annual business income, as a sole proprietor with just my social security number.
Now, I did have my regular full-time employment income which I’m sure played a significant role in my approval. But the fact that the business itself had only $500 in annual income was not an issue.
Let’s take a look at why it makes sense to get a business card, what the application process looks like, what banks may consider when reviewing your application for a business credit card, and why it’s possible to get a business card even if you have a new business with little income.
Why you should get a business credit card
It may not seem like much to get a business credit card, they really have made my life so much better. And they can do the same for you! Not only can you earn valuable welcome bonuses with the top business card offers, but having a business card will allow you to:
- Separate your business spending from personal spending, making it easier to find write-offs and deductions when it comes time to filing taxes
- Help fund travel-related items, like airfare, hotels, or car rentals (which comes in very handy especially for new startups that may be strapped for cash)
- Purchase protection and other perks, like cell phone and car rental insurance
- Rewards for your everyday purchases
What you’ll be asked when you apply for a business credit card
Applying for a business card is much like applying for a personal credit card — the main difference being that along with your personal information, you’ll have to provide information about your business.
For example, you’ll have to provide your name, address, and social security number, along with business information like the name of your business, the business’ contact info, number of employees, your yearly revenue, etc.
You’ll also be asked to provide an Employee Identification Number. If you don’t have one, you can use your Social Security Number (SSN) instead.
The application will vary depending on which bank or issuer you’re applying with. But as an example, here’s our step-by-step guide to applying for a Chase business card.
How to apply and get approved for a business credit card
What qualifies as a business?
If you do anything outside your regular day job for profit, you can qualify for a business credit card. Doing any type of yard work or maintenance, selling items on eBay, and tutoring are all activities that qualify you as a small business owner. In other words, you don’t have to be an executive at a large multi-million dollar corporation to qualify for a business card.
If you are a small business owner, you can take a look at some of the best business credit cards depending on your specific goals. While many business owners file a separate business license or formally incorporate their company, it’s not necessarily a requirement for a business credit card.
That said, there are reports online of people who have been asked for proof of the existence of the business when they applied for a business credit card. In fact, MMS editor Meghan was asked to do just that when she recently applied for the fantastic offer on the Ink Business Cash® Credit Card. She was able to satisfy the bank’s request by providing proof of a business EIN. You can obtain an EIN through the IRS website for free.
What are the best business credit cards?
Some of the best business credit cards include:
- Ink Business Preferred® Credit Card – 100,000 bonus points after you spend $15,000 on purchases in the first three months from account opening
- Ink Business Cash® Credit Card – $750 bonus cash back after you spend $7,500 on purchases in the first three months from account opening
- Ink Business Unlimited® Credit Card – $750 bonus cash back after you spend $7,500 on purchases in the first three months from account opening
- The Business Platinum Card® from American Express – 120,000 Membership Rewards® points after you spend $15,000 on eligible purchases with your Card within the first 3 months of Card Membership.
- Southwest® Rapid Rewards® Performance Business Credit Card – 80,000 points after you spend $5,000 on purchases in the first three months of account opening.
- Alaska Airlines Visa® Business credit card – 40,000 Alaska Airlines miles after spending $2,000 on purchases in the first 90 days of opening the account
- And others!
As an example of what you can do with a lucrative welcome bonus from one of these cards, the Chase Ink Business Preferred is currently offering a welcome bonus of 100,000 bonus points after you spend $15,000 on purchases in the first three months from account opening
Those points are worth $1,000 in cash back or $1,700 in travel if you book airfare, hotels, or car rentals through the Chase travel portal! And you have the ability to get even more value out of those Ultimate Rewards points by transferring the points to any of Chase’s travel partners.
For more details about each of these cards and why they might be of interest to business owners, check out our complete guide to the best business credit cards.
FAQ about business credit cards
What are business credit cards?
Business credit cards are cards issued by banks that are meant to be used by a business rather than an individual. Holding a business credit card can help your business build business credit which can, in turn, help businesses borrow more and grow in the future. There are business cards for all types and sizes of businesses. The right one for you depends on your business’ spending habits and your own financial needs and goals.
Can you get a business card without business income?
We get a lot of questions about whether or not it’s possible to get approved for a business card with very little business income. Unfortunately, the answer isn’t a straightforward one. Every bank has a different set of criteria and business income is just one of several factors they look at.
Many business credit cards are personally guaranteed, meaning the bank will look at both your personal and business income combined. They will also look at your personal credit history, so if you have a good credit score and other income besides your small business, you’ll have a better chance of being approved.
Banks can also consider your relationship with them. In my case, I’m sure it didn’t hurt to have had a 10+ year relationship with Chase already, and excellent payment history on multiple personal credit cards with them.
Ultimately, the bank has the final say in whether you will be approved, and every lender has different approval criteria. So even though you may qualify at one bank, it doesn’t mean you’ll be eligible for a business card at another bank.
What is a business credit score and can you check yours?
Your business credit report and score is based on a separate credit file than your personal credit report and different sources of information.
While your personal credit information is tied to your social security number (and other identifying information), your business report and score is tied to your Employer Identification Number (EIN) or Tax ID number.
If you’ve applied for a business card in the past or have been a business owner for a number of years, it’s worth it to keep track of your business credit. That’s because it’ll affect things like any loans you’re looking to get or if you’re looking to extend your business’ credit. Here’s our guide on how to check your business credit report.
How do I build business credit?
Building business credit is similar to building personal credit. Start slow, be responsible, and you’ll build a solid credit history based on things like your banking history, business revenue, and more.
You must have a qualifying business to apply for a business credit card. But what may come as a surprise to many is what actually qualifies as a business. You don’t need to be an executive at a large corporation to qualify as a business owner. As long as you do anything outside your regular day job for-profit, you will be eligible for business credit cards.
In addition, many banks will look at both your personal and business income when deciding whether to approve you for a business credit card. So even if you have a new business with little to no income, it is possible to get approved for the top business cards if you have other sources of income and a good credit score.
Did you have success applying for a business credit card as a new business owner? Feel free to share with us in the comments below!
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