If your small business is big enough to have an Employer Identification Number, or EIN, you may be wondering whether you still have to put your Social Security number on your business credit card application. Is it possible to get a small business credit card without an SSN? And can you apply for a business card with EIN only?
Well, possibly—but many business credit card issuers require your SSN during the application process. Credit card issuers protect themselves by making sure you can back your credit card with a personal guarantee, which means they’re probably going to use your SSN to conduct an inquiry into your personal credit.
Nearly all of today’s best small business credit cards require an SSN—but once your business is large enough to apply for corporate credit cards, you might be able to get business credit with just an EIN. These EIN credit cards often have strict application rules, and some types of small businesses won’t qualify. That said, if you want to keep your business and your personal finances separate, you’re going to want to know how to get a business card without an SSN.
In most cases, you cannot get a business credit card without an SSN. Small business credit cards require a personal guarantee, which means that you become personally responsible for any debt that your business cannot pay off. This is why credit card issuers often check your personal credit before issuing you a business credit card—and in order to perform a hard credit inquiry on your personal credit, they need your Social Security number.
Leslie Tayne, financial attorney and author of Life & Debt, says applying for a business credit card without an SSN can be an arduous process. “If you don’t have a Social Security number, you will have to fill out a great deal of paperwork and go through some bureaucracy,” she says. “Even after that, you may still have a difficult time finding a business card lender that will approve you for a card without a Social Security number.”
When can you get a business card without an SSN? If you apply for a corporate credit card, you may not need to provide a personal guarantee—but corporate credit cards are different from small business credit cards, and a corporate card may not be the best fit for your business.
Not only that, but becoming eligible for a corporate card often requires annual revenue in the millions of dollars, as well as at least 15 or more users of the account within the organization. Certain business structures are also required for companies who want to become eligible for a corporate credit card, and sole proprietors and small businesses very rarely make the cut.
What is an EIN?
An EIN, or Employer Identification Number, is a nine-digit tax identification number assigned to sole proprietors, corporations, partnerships, estates, trusts, employee retirement plans and other entities for tax filing and reporting purposes. This number works almost like an SSN for your business.
If you want to add an EIN to your small business, the IRS recommends applying for an EIN online. Here’s a three-step guide to help you through the process:
- Determine whether you’re eligible for an EIN. Your principal business must be located in the U.S. or U.S. territories. You must have a valid taxpayer identification number (SSN, ITIN, EIN) to apply for a new EIN, and you are limited to one EIN per responsible party per day.
- Complete the application in one sitting. You won’t be able to save and return at a later time, and your session will expire after 15 minutes of inactivity.
- Submit your application. You’ll get your EIN immediately after completing the application. You can then download, save and print your EIN confirmation notice.
Some people want to apply for a business card with EIN only instead of an SSN because they don’t want their personal credit score to affect their eligibility for a business credit card. Other people want to keep their personal and business finances separate—and to keep any potential business finance issues from negatively affecting their personal credit.
Why would a business’s financial difficulties affect your personal credit? Two reasons. First, applying for a business credit card that requires a personal guarantee means that you’ll be personally responsible for any balances added to the card. This includes credit card debt that your business cannot afford to pay off in full.
The second reason is a little more complicated. Businesses have credit scores just like individuals do, and in some cases lenders will report small business credit card activity to both the business credit bureaus and the personal credit bureaus. This means that your business credit card could appear on your personal credit report. If you miss a payment on your business credit card or run up high credit card balances during low cash flow months, your business credit card activity could hurt your personal credit score.
Keeping business separate
Whether your motivation for getting a business card with EIN is based on potential impacts to your credit or not, keeping your business finances separate from personal finances makes a lot of sense. After all, maintaining separate accounts for your business can help you stay organized for tax purposes, and it can keep you from accidentally merging business expenses with your personal ones, or vice versa.
Having a separate business credit card can also help you earn rewards on specific business expenses as well as all your other spending, and some business credit cards offer perks geared specifically to businesses.
If the main driver for getting a business card with EIN is your desire to limit any impact on your personal credit, however, you can also consider applying for a traditional business card that doesn’t report to the consumer credit bureaus. You’ll need to list your SSN on your application, but cards that fall under this umbrella won’t report your balances, your payments or other information to Experian, Equifax or TransUnion.
Reportedly, card issuers like Bank of America, Citi, PNC, U.S. Bank, BBVA and Wells Fargo do not typically report any of your business card activity to the credit bureaus—not even late payments or accounts in default. Before proceeding, make sure you confirm this for your circumstances with a customer service representative.
This means that, even though you’ll have to list your SSN on your business card application, a card like the CitiBusiness® / AAdvantage® Platinum Select® Mastercard® or the Bank of America® Business Advantage Travel Rewards World Mastercard® could be worth considering.
What business credit cards can you get with only an EIN?
Some credit card issuers allow you to apply for a business card with an EIN instead of an SSN, although options are limited. Here are some EIN credit cards for business worth looking into:
Corporate business credit cards
Corporate business credit cards allow you to take on liability through your business. You may be able to get a corporate credit card without a personal guarantee—in other words, your business is liable for all of the credit card debt. In some cases, corporate credit cards don’t require an SSN, meaning you can get a business card with EIN only.
Corporate credit cards can be an excellent option if you want to apply for a business card with an EIN. That said, corporate cards have stricter application rules. In most cases only certain types of businesses are eligible, and your business may need to earn a certain profit margin each year. Many issuers extend business credit with just an EIN, but only C-corps, S-corps, LLCs, or LLPs registered in the U.S. are eligible to apply. If you are a sole proprietor, you might have to work a little harder to find the right corporate card for your business.
Corporate store credit cards
Why not consider a corporate store credit card at a store you frequent regularly, such as Staples or Office Depot? Some corporate store credit cards don’t come with a personal liability requirement, making them excellent EIN credit cards. Corporate store credit cards often offer specific perks like discounts on purchases, cash back options and points and rewards.
Corporate gas cards
Another option is to apply for a corporate gas card or a fleet fuel card, which may allow your company to apply without a personal guarantee. For example, you can get the Shell Small Business Card with your EIN if your business takes in $1 million in revenue every year and has at least one year of business history.
Prepaid business credit cards
A prepaid business card is just what it sounds like: You load a prepaid balance onto the card in advance, then spend up to that balance. Prepaid business credit cards are always low-risk for card issuers and don’t require a personal guarantee or an SSN. Prepaid cards are also an excellent way to help you track your spending while avoiding credit card debt.
The downside to prepaid cards is that you aren’t able to use them to build business credit. However, they’re a great solution if you have a low credit score and don’t want to tie your personal credit to your business—or if you’re worried that you might lower your credit score even more if your business doesn’t work out.
Alternatives to business credit with just an EIN
Since it is difficult to get business credit with just an EIN, you should consider some alternatives. The first alternative is to apply for a business credit card using your Social Security number — even if this doesn’t seem ideal. As mentioned above, you at least have the option of picking a business card issuer that doesn’t report to the consumer credit bureaus, such as Citi or Bank of America.
This will be the best solution for most small businesses and sole proprietorships. It may also be your only option if you want to start building business credit and take advantage of the perks and rewards offered by small business credit cards. Also, keep in mind you shouldn’t face any negative impact on your credit score if you use your card responsibly, never make a late payment and keep your business credit utilization ratio on the low side. These are steps you should be planning to take anyway if you hope to benefit from a credit card over the long run.
If you are a small-business owner whose business is not yet eligible for an EIN-only credit card like a corporate credit card, your best move might be to apply for a business credit card as a sole proprietor using your SSN.
Yes, you’ll be personally guaranteeing any debt you put onto the card. And yes, your personal credit score could affect your ability to get business credit. The way you use your business credit card could also affect your personal credit score, depending on what information your card issuer reports to the three major credit bureaus (Experian, Equifax and TransUnion).
The second alternative is to fund your small business without using credit. If your business earns enough money that you don’t need to use credit to cover operating costs, for example, you might be able to keep your small business running without applying for a small business credit card. This method will keep you from having to use an SSN to apply for a business credit card, but it will also keep your business from building a solid credit history and credit score. This lack of credit history could become a problem if you ever decide to expand your business through small business loans or other forms of business credit.