A business credit card is one designed for use by a company — from small businesses to major corporations. Business credit cards aren’t designed for personal use and they don’t appear on an individual’s credit history or credit report. But similar to secured personal credit cards, a secured business credit card is backed by a security deposit and helps business owners with bad or limited credit scores. The security deposit also serves as a credit line. For example, if a business pays $500 for its credit card security deposit, its line of credit also will be $500. Add to your deposit and your credit line will grow.
GOBankingRates selected the best business cards for bad credit, based on:
- Annual fees
- Annual percentage rates
- Number of cards permitted to an individual business
- Rewards programs
Review the following table for an at-a-glance view of these cards’ features, and read on to learn more details so you can decide which bad-credit credit card is right for you.
|3 Best Business Credit Cards for Bad Credit|
|Credit Card||Annual Fee||APR||Intro/Promo Offers||How to Apply|
|Wells Fargo Business Secured Credit Card||$25 per card (up to 10 cards offered)||11.90%||Earn 1.5% cash back or rewards points||Learn More|
|BBVA Compass Secured Visa Business Credit Card||None the first year; $40 each additional year||17.74%||1 point for each $1 of purchase|
Up to 15% savings at participating merchants with Visa SavingsEdge program
Visa liability waiver program
Auto rental collision and travel accident insurance
|First National Bank Business Edition Secured Visa Card||$39||19.24%||Visa SavingsEdge automatic rebates at participating merchants||Learn More|
The Best Business Credit Cards for Bad Credit
Setting up a business isn’t easy, especially if the thought of getting a credit check makes you nervous because of a bankruptcy or a host of unpaid bills on your financial record. But a secured business credit card — that is, a business credit card for someone with bad credit — provides the structure to help a small business owner with a bad or weak credit history improve their credit score. Even if the capital flow from these cards is small, they can open the gates to lenders trusting you to pay off debt in the form of unsecured credit cards. Here are the best credit cards for business owners with bad credit:
Wells Fargo Business Secured Credit Card
Designed for new businesses or older ones with troubled credit histories, this card comes with an annual fee of $25 per card for up to 10 credit cards. A new customer offer during the second quarter of 2018 offers 1.5 percent cash back, credited quarterly to the card or a Wells Fargo business checking or savings account. Although a rewards rate of 1.5 percent is small compared to elite credit card programs, it’s better than nothing, which is what most secured credit cards offer. Alternatively, this card offers reward points for every $1 spent on net purchases with 1,000 bonus points earned when your company charges $1,000 in any monthly billing period.
- Cash-back or rewards points offer; cash-back offer until June 30, 2018
- Annual fee of $25 per card is reasonable
- No foreign transaction fees
- Low APR of 11.9 percent
- Has less in the way of rewards programs
- Lower credit limit than other credit cards offer
Also Learn: How to Get a Business Loan
BBVA Compass Secured Visa Business Credit Card
If you’re looking for rewards among the best credit cards, when it comes to secured small business credit cards, this one offers a pretty good package, providing one point for each dollar spent. You’ll pay no annual fee for the first year, and employee cards are offered at no additional cost. A liability waiver program protects businesses against losses incurred through card misuse by a terminated eligible cardholder up to $100,000. There’s also an insurance program for rental cars for collision, damage and loss. The security deposit minimum is $500.
- Annual fee waived for first year
- One point for each dollar spent
- Employee cards added at no additional expense
- Card not available online, requiring you to visit a BBVA Compass branch to open an account
- Offer only available where BBVA Compass has branches: California, Texas, Florida, Colorado, Arizona, New Mexico and Alabama
- Credit limit equal to 90 percent of your money deposited into a savings account at BBVA Compass, which is problematic for businesses that bank elsewhere and want to keep their accounts under one roof
First National Bank Business Edition Secured Visa Card
When it comes to rewards programs, this is a relatively no-frills card. It’s a secured business credit card for small-sized companies. To apply for this business credit card, you must deposit 110 percent of the credit limit amount — between $2,000 and $100,000 — subject to credit approval. The variable interest rate is 19.24% APR and the annual fee is $39. Among small business credit cards, this is one that doesn’t provide cash back, but instead offers the option of some discounts on qualifying purchases such as Chevron and La Quinta Inns & Suites, which are provided in the form of credits to your account.
- Relatively large credit limit
- Offers interest earned on your security deposit
- No rewards program
- Minimum credit buy-in of $2,000; security deposit minimum of $2,200
The options for entrepreneurs with bad credit are limited when it comes to secured business credit cards. By comparison, the options for small business credit cards for good or fair credit score holders are more numerous. But a bad credit score shouldn’t dissuade you from starting the business of your dreams or growing your current company. Improving your credit score via a secured business credit card can be the first step to financial independence.
Corporate vs. Business Credit Cards: Which Is Best for Your Bottom Line?