Your credit score is dismal and you can’t pay off your personal credit card. You would think that with this credit history, you would never be approved for a business credit card.
You are wrong. Even with a bad credit rating, you can get a card. Business credit card companies will approve your application for certain types of bad credit cards, such as a secured card.
Other business card issuers will require you to pay the full credit card balance each monthly billing period.
What is bad or poor personal credit?
A credit score of 579 or less is considered bad or poor credit. Your personal credit history contributes to credit scores. But don’t forget that there is also a business credit score.
Here are the main factors that affect your personal credit score:
You have unpaid bills or loans from the past. This may include student loans.
You have made many late payments on utilities, a mortgage, or personal credit cards.
You have exceeded your own credit limit on your personal card.
How can a business owner qualify for a card with bad or poor personal credit scores?
You can get a “secured” credit card. This means that you make a refundable security deposit in advance and cannot exceed this amount on card charges. It’s similar to the security deposit you pay when renting an apartment or house.
Or you can get 0% APR cards. With these, the credit card issuer requires you to pay your balance in full each billing cycle. With regular payments, your credit limit may increase. If you are still wondering why should I get a business credit card, the best answer is that you can start repairing your credit. Once you start fixing it, you can even get small business loans with bad credit.
How to Choose the Best Business Credit Cards for Bad or Poor Credit?
Most business credit cards offer your choice of cash back or rewards programs. Until you go above a fair to good or excellent credit rating, you will not qualify for cards with excellent programs.
But that doesn’t mean you can’t get a good card and build business credit. Business credit card issuers will perform a personal credit check. You should be able to get approved for a secure business credit card. Or you can choose to start building credit by choosing a card that requires you to pay it off every billing cycle. While you’re in this process, look for ways to fix your credit score.
The 6 Best Business Credit Cards for Bad Credit
Let’s start with secured credit cards.
With an unsecured credit card, no cash deposit on your part is required, although the card may be linked to your business bank account.
With secured business credit cards, you must provide a deposit as a personal guarantee. You won’t get a high credit limit unless you make a high dollar deposit.
1. First National Bank Visa Business Edition® Secured® card
the Secure Business Edition® Visa® Card | First National Bank of Omaha (fnbo.com) includes a benefit you would normally only get with an unsecured business credit card – 0% APR for 12 billing cycles. You’ll also get 1.5% cash back with this secure Visa card.
- Annual fees: $0
- APR: 0% for 12 cycles, then 14.24-20.24%
- Credit required: Bad, poor and better.
2. Wells Fargo Business Secure Credit Card Account
You will link the Wells Fargo card to a Wells Fargo business checking account. Compared to other secured credit cards for small businesses, the Wells Fargo Business Secured Credit Card offers you 1.5% cash back, or you can choose to earn one point for every dollar spent. You will receive 1,000 bonus points each cycle you spend $1,000 on qualifying business expenses and business purchases. Add in no foreign transaction fees and free employee cards, plus liberal credit limits of up to $25,000, and Secure Wells Fargo Business is the right business credit card for you. many.
The only downside? Use of the Wells Fargo Business Secured Credit Card is not reported to personal credit bureaus. You can always use proof of your timely payments on the card to improve your credit report with the major credit bureaus – you have to do it yourself.
- Annual fees: $0
- APR: 11.9% plus prime rate.
- Credit required: Bad, poor and better.
3. Capital One Platinum Secure Commercial Credit Card
This is a great starter model in business credit card options. There is no annual fee for the Capital One card, and you can start with deposits as low as $49 to $200.
- Annual fees: $0
- APR: 26.99%
- Credit required: Bad, bad or better
Best Business Startup Credit Cards for Bad Credit
If you’re a startup or entrepreneur, you’ll want a card that grows with you, while keeping your spending in line.
We’ve selected two that require you to pay the full balance each month, and a third card to help new businesses that rely on a fleet of vehicles.
4. SVB Innovators
At first glance, the SVB Innovators is one of the best business credit cards for entrepreneurs.
- Offers for startups: A business rewards program that gives you 2 points for every dollar spent. You can use the points to create a credit on your statement.
- Annual fees: $0
- Introductory APR: 0%. You must pay the full balance each cycle, but your credit limit increases rapidly as you make payments.
- Credit required: Bad, poor and better.
5. Stripe
Many retailers or restaurant owners recognize Stripe as software used to process payments. If you already have a Stripe account, you can get one. Stripe credit card.
- Offers for startups: You’ll get 2% cash back and $150 Google ad credit. 3 months free on Shopify.
- Annual fees: $0
- Introductory APR: 0%. You must pay the full balance each cycle.
- Credit required: Bad, bad or better.
6. Sam’s Club Business Mastercard
You must be a member of Sam’s Club. This Sam’s Club card is also accepted at Wal-Mart. Considering the vast choices at Sam’s and Wal-Mart, this is a great card for outfitting an office and getting big discounts on gas purchases.
- Offers for startups: 5% cash back on gas purchases and 3% cash back on purchases at Sams. On purchases elsewhere, you’ll get 1% cash back.
- Annual fees: $0
- Introductory APR: 15.65-23.65%
- Credit required: Bad, bad or better, and you have to be a member of Sam’s Club.
Secured Card Vs. Unsecured Business Credit Card
With an unsecured card, you risk spending more than you should. With a secure card, you can use your personal checking account or savings account to make deposits, helping you control your spending.
Unsecured credit cards are less restrictive, which can make them an ideal business credit card – for those who can stick to a budget. If you want to learn more, search for resources on what business credit cards are.
What is the best credit card for bad credit?
The best business credit card will probably be the one you get after cleaning up your credit report.
In the meantime, we like the First National Bank Secure Visa Card for its key features: no annual fee, 0% APR for 12 cycles, and 1.5% cash back.
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