Best business credit cards for startups

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Business credit cards can be valuable tools if you want to earn rewards and have a line of business credit at your disposal. However, the length of time your business has been in operation is not the most important consideration when it comes to selecting a business credit card. Instead, your credit rating and income will generally determine which business credit cards you can qualify for.

As you compare all your options, it’s smart to look for business cards that can help you reach a goal, whether that’s continuing to build your credit rating or racking up cash back or travel rewards.

Here are Bankrate’s top picks for business credit cards for startups in 2020:

Best for cash back

Capital One® Spark® Cash for Business

  • Earn a $500 bonus when you spend $4,500 on your card within three months of account opening
  • Earn an unlimited 2% back on all purchases
  • $95 annual fee (waived the first year)
  • Free employee cards
  • No foreign transaction fees

Why it’s the best for cash back

The Capital One® Spark® Cash for Business is the best for cash back based on the simple fact you can earn an unlimited 2 percent back on everything you buy. You’ll also qualify for free employee cards that will make it easier to rack up more cash back on your employee’s business-related expenses. The $500 cash bonus this card offers is also generous and fairly easy to earn, setting you up for an excellent first year of rewards.

When it comes to cashing in the rewards you earn with this card, the Spark Cash for Business makes it easy. You simply redeem for cash back in any amount, at any time and with no expiration date while your account is open. To sweeten the pot, this card comes with a handful of important consumer protections including secondary auto rental collision insurance, purchase protection against damage and theft, extended warranties and emergency card replacement.

Best for flexible travel rewards

Ink Business Preferred® Credit Card

  • Earn 100,000 bonus points when you spend $15,000 on your card within three months of account opening
  • Earn 3x points on up to $150,000 spent on select online advertising, travel, shipping purchases and internet, cable and phone purchases each year (then 1x points)
  • Earn 1x points on all other purchases
  • $95 annual fee
  • No foreign transaction fees
  • Free employee cards

Why it’s the best for flexible travel rewards

The Ink Business Preferred® Credit Card is easily the best of the new business credit cards for travel due to the fact the rewards you earn fall within the Chase Ultimate Rewards universe. This means you can redeem your points for gift cards, merchandise, experiences or travel through the Chase Ultimate Rewards portal, which partners with Expedia. But you can also transfer your points 1:1 to popular airline and hotel partners like Southwest Rapid Rewards, United MileagePlus, British Airways, World of Hyatt and Marriott Bonvoy.

The rewards scheme this card offers can also be extremely lucrative if you spend a lot within the 3x categories each year. Add in the initial bonus of 100,000 points, which are worth $1,250 in travel when you use them to book airfare, hotels, rental cars and other travel through the Chase Ultimate Rewards portal, and it’s easy to see why this card is among the best business credit cards for startups.

Best for average or fair credit

Capital One® Spark® Classic for Business

  • Available for consumers with average credit
  • Earn an unlimited 1% cash back
  • No annual fee
  • Free employee cards

Why it’s the best for average or fair credit

Where most business credit cards for startups are geared to consumers with good or excellent credit, the Capital One® Spark® Classic for Business is available to those with just “average” credit instead, thus the lower overall rewards rate. Capital One says a consumer with credit in this range may have defaulted on a loan within the past five years or have a limited credit history that is less than three years in length. With that in mind, this card is a good option for anyone who owns a business and wants to earn a base level of rewards while they continue building their credit rating.

Earning 1 percent cash back on all your purchases isn’t half bad either, and that’s especially true when you consider this card doesn’t charge an annual fee. You’ll also get free employee cards and you won’t pay foreign transaction fees. Perks you’ll receive as a cardholder include secondary auto rental insurance, travel and emergency assistance services, purchase protection against damage or theft and extended warranties.

Best zero interest offer on purchases

Ink Business Unlimited Credit Card

  • Earn $500 on bonus cash when you spend $3,000 on your card within three months of account opening
  • Earn an unlimited 1.5% back on everything you buy
  • Introductory 0% APR on purchases for 12 months (variable APR of 13.24% –19.24% thereafter)
  • No annual fee

Why it’s the best for zero interest on purchases

There aren’t many business credit cards that offer introductory APRs, yet the Ink Business Unlimited℠ Credit Card gives new cardholders this benefit on purchases for 12 months. That makes this card a solid option if you want to make a large purchase using your card and pay it off over time, or if you simply need to carry a balance for a while in order to improve your business cash flow.

Earning a $500 bonus when you spend $3,000 on your card within three months of account opening is another major plus, and that’s on top of the fact you earn a flat 1.5 percent cash back for everything you buy. This card also comes with no annual fee, so you have the potential to keep the costs of carrying this card at a minimum.

How to choose the best credit card for your startup

The best business credit card for a new business or a startup is different for everyone. These tips can help you find the best card for your business and your needs.

Think over your goals

First, think over what you hope to accomplish with a business credit card. Do you need to save money on interest? Do you simply want to earn rewards on your spending? Perhaps you just want to use a credit card to continue building your credit score. Since different cards offer their own unique benefits that lead to different goals, figuring out what you want your credit card to do for you is an important consideration.

Compare rewards programs

If you are considering a card that lets you earn rewards, make sure you understand the intricacies of each rewards program. Where some cards only let you earn rewards good for cash back or statement credits, others let you redeem for travel, experiences and more.

Check your credit score

Having a good idea of your credit score can also help you decide on a card, and that’s especially true if your credit score is fairly low or your credit history is limited. Fortunately, it’s easy to check your credit score online without paying a fee.

Frequently asked questions about business credit cards for startups

How do business credit cards work?

Just like personal credit cards, business credit cards extend consumers a line of credit they can use to make purchases. These cards have more specific application requirements than general cards. Issuers make money on business credit cards by charging annual fees as well as interest on your purchases when you carry a balance from month to month.

How can I apply for a business credit card?

You can apply for a business credit card online and from the comfort of your home. All you have to do is compare your options, find a business credit card that makes sense for your goals and hit the “apply now” button.

What do I need to qualify for new business credit cards?

To qualify for a business credit card, you’ll need to have your own business or a side hustle of some kind. You’ll also need reportable income you can include in your business credit card application. Note, however, that you don’t have to have an Employer Identification Number (EIN) to apply; you can qualify for a business credit card as a sole proprietor by using your Social Security number instead.

How does a business credit card affect my personal credit score?

Most business credit cards won’t report your credit movements to your personal credit report unless you default. However, your personal credit score will be considered when you apply, and you’ll have a hard inquiry placed on your personal credit report during the process.

What will my credit limit be?

Your business credit card limit will depend on your income, your creditworthiness and other factors card issuers consider during the application process. With that in mind, you won’t know your new card’s limit until you apply and get approved.