A business credit card is an essential piece of a startup’s financial toolset since starting a new firm needs careful budgeting and wise decision-making. Credit cards made for startups may provide several advantages to company owners trying to build credit and keep track of their costs.
The top starting company credit cards that are exclusively accessible to companies having an Employer Identification Number (EIN) will be discussed in this article.
Why Choose A Startup Business Credit Card?
Building a credit history for your new firm while keeping personal and professional spending separate is easy with startup business credit cards.
They are a great tool in managing daily operations and company development since they often come with benefits and prizes specifically designed to meet the demands of startups.
Top 7 Startup Business Credit Cards with EIN Only
Chase Ink Business Preferred® Credit Card
Credit card Chase Ink Business Preferred® gives a high sign-up bonus and points on business-related spending, including travel, advertising, and shipping. This card is renowned for its aggressive rewards program.
The card is a flexible option for companies on the go since it also offers purchase protection and travel insurance.
American Express Business Gold Card
The American Express Business Gold Card can be a great choice if your startup’s spending fluctuates by category. Thanks to its customizable rewards scheme, you may earn points in the two areas where your company spends the most monthly money. Additionally, the card provides options for managing expenses and travel rewards.
Capital One Spark Cash for Business
If you want simplicity, the Spark Cash card gives a set cash-back return on all purchases. Startups who wish to earn cash incentives without dealing with complicated reward categories may find this extremely helpful.
Bank of America Business Advantage Cash Rewards
The Bank of America Business Advantage Cash benefits Mastercard is a great option for companies that regularly deal with the bank since it benefits Bank of America business clients and cash back on purchases. There is no yearly charge, and you may maximize your benefits by selecting your spending category.
CitiBusiness® / AAdvantage® Platinum Select® Mastercard®
For startups with an emphasis on travel, the CitiBusiness® / AAdvantage® Platinum Select® Mastercard® provides perks like free checked baggage and priority boarding on American Airlines flights. Additionally, every transaction will earn you miles, enabling you to save money on your next business travel.
Discover it® Business Card
The Discover it® Business Card is a fantastic choice for entrepreneurs seeking ease of use and cash-back incentives. It’s a tempting option for start-up firms since it has no annual fee, cash back on all purchases, and a special first-year promotion where Discover doubles all cash back earned.
U.S. Bank Business Leverage® Visa Signature® Card
The U.S. You may earn more points with the Bank Business Leverage® Visa Signature® Card in areas like office supplies, petrol, and restaurants thanks to its tiered rewards system, which is in line with typical beginning costs. It’s a wise decision for companies with various purchasing trends.
Factors To Consider Before Applying For Startup Business Credit Card
Choose a credit card whose reward structure corresponds to your startup’s spending patterns and offers benefits that meet your requirements :-
Look for cards with sizable sign-up incentives to maximize your rewards in the first few months.
Examine if the prizes and benefits supplied make up for the yearly price.
Although paying off your monthly amount is ideal, it’s important to comprehend the interest rates.
Verify that the card’s credit limit satisfies the funding needs of your company.
How To Apply For A Business Credit Card With EIN?
Applying for a business credit card with an EIN requires several procedures to guarantee a simple and effective application process.
Here is a detailed explanation of how to use your EIN to apply for a business credit card :-
Recognise Your Company’s Needs
Understanding your company’s spending patterns and requirements is crucial before applying for a business credit card. Consider if you need tools for managing your expenses, travel advantages, or cash-back incentives. Choose the credit card that best suits your company’s needs since different credit cards have different benefits.
Assemble The Necessary Documentation
You must provide certain papers to prove the validity of your company when applying for a business credit card. Typical papers consist of :-
- An essential need, the EIN (Employer Identification Number) validates your company’s identification and legal standing.
- Business information contains your company’s full name, address, and phone number.
- Business Structure: Specify if your company is a corporation, LLC, partnership, or single proprietorship.
- Ownership Information: Describe the company’s principals, partners, or important employees.
- Prepare to provide your company’s yearly income, anticipated monthly costs, and other financial information.
Choose a Suitable Credit Card
Find a business credit card that meets your requirements and tastes by researching. Consider awards, yearly costs, interest rates, and any initial deals. Look for credit cards that provide advantages specific to your sector and are geared toward new enterprises.
Look At The Terms And Conditions
Read the terms and conditions of the credit card you are considering in great detail. Recognize the fees, rewards program, interest rates, and any restrictions. Make sure you are familiar with late payment fees and other crucial information.
Fill Out The Form Completely
Most credit card issuers provide an online application procedure for business credit cards. Navigate to the business credit card section on the issuer’s website. Give the necessary information and complete the application form. Check the application twice for mistakes before submitting it.
Provide Your EIN
You will be asked to submit your company’s EIN throughout the application process. This is essential to confirm your company’s legitimacy and eligibility for a business credit card.
Submit Supporting Documentation
Some credit card applications may ask you to fax or submit supporting documents to prove the validity of your company. These might be tax records, company licenses, or legal paperwork. Submit these papers according to the directions given by the credit card company.
The credit card company will examine your application once you complete your paperwork. It may take a few business days to a few weeks to complete this procedure. Certain credit card companies could ask for further details or clarification during this time.
Get The Card And Approval
The credit card provider will inform you whether your application has been accepted. You will get a letter with your business credit card at the address you gave on the application. Start using the card for business spending after activating it as directed.
Manage Your Business Credit Card Responsibly
Once you obtain a company credit card, utilize it wisely by paying your bills on time and maintaining a spending record. This will assist you in establishing a good credit history for your company.
Credit card acceptance is based on the issuer’s requirements and your company’s creditworthiness. Before applying, it’s a good idea to know your company’s financial situation and weigh your possibilities for credit cards to choose which would work best for your startup’s requirements.
How To Start Business Credit With EIN?
Building corporate credit using an Employer Identification Number (EIN) is crucial for developing your company’s credit history and reputation.
Step-by-step instruction on how to begin establishing company credit with an EIN is provided below :-
Formation Of Legal Entities
Make your company legitimately registered as a company, corporation, or partnership. This is a crucial stage that defines the distinct character of your company from your money.
How To Get An EIN
Apply to the IRS for an Employer Identification Number (EIN). This special identification number is essential for creating business bank accounts, paying taxes, and establishing company credit.
Establishing A Business Bank Account
To create a business bank account, use your EIN. This account, which has to be kept separate from your own, will make it easier for you to control your company’s money.
Create Accounts For Business Credit
Apply first for credit accounts created especially for business use. These could include business loans, vendor credit accounts, and credit cards for businesses. Ensure that your creditors provide business credit bureaus with a report on your payment history.
Get A Business Credit Card Application
Utilizing your EIN, research and apply for a company credit card. You may use this card to create a credit history for your company. Keep your credit utilization low and pay off your obligations on schedule.
Open Accounts For Vendor Credit
Establish connections with suppliers who provide credit terms to companies. These suppliers may offer you products or services on credit with the option to pay within a certain timeframe. Make sure that these suppliers inform business credit bureaus about your payment history.
Keep An Eye On Your Business’s Credit Report
Examine your company’s credit history regularly with reputable business credit agencies like Dun & Bradstreet, Experian Business, and Equifax Business. Ensure the data is true and accurately shows your attempts to improve your credit.
On-Time Bill Payment
Maintain a consistent payment schedule for all of your company credit accounts. Payments on time show you are creditworthy and help your company’s credit score.
Apply For More Credit Gradually
You may apply for more varied credit products, such as business loans or lines of credit, as your company’s credit profile develops. Be careful not to overextend the borrowing power of your company.
Identify Trade References
Establish connections with partners, creditors, and suppliers who can attest to the dependability of your company. These commercial references might improve your company’s credit standing.
Keep Personal And Business Finances Separate
Clearly distinguish your funds from your corporate finances. When feasible, try to avoid utilizing personal credit for work needs.
Create a Successful Payment History
Pay your credit card payments and other debts on time every month. A sound company credit profile is built on a solid payment history.
A firm needs time to build credit. Building a strong credit history and seeing major changes in your company credit score could take many months or even years.
Consult A Professional
Consider speaking with financial advisers or business credit specialists for advice on efficiently creating and managing your company credit.
Remember that establishing company credit is a continuous process that calls for patience, responsibility with money, and discipline. Your company will be better positioned for future development and financing if you build a solid credit history of utilizing your EIN.
How Much Of A Credit Score Do I Need For A Business Card?
Depending on the issuer and the particular credit card you’re looking for, different business credit cards may have different credit score criteria.
In general, when reviewing your application, business credit card providers will consider both your credit score and the financial stability of your company. An example of a range of possible credit scores is shown below :-
Outstanding Credit (720+)
You probably qualify for most business credit cards with an outstanding credit score (usually 720 or above). Several choices are available with alluring incentives, advantages, and cheap interest rates.
Good Credit (680-719)
If you have good credit, you still have a high chance of being approved for numerous business credit cards. Even if the terms and benefits aren’t available, you’ll probably have a good variety.
Fair Credit (620–679)
Some issuers of business credit cards provide choices for those with fair credit. Your options, however, can be more limited, and you might be authorized for credit cards with higher interest rates and fewer benefits.
Poor Credit (Below 620)
Getting approved for a business credit card could be more difficult if your credit score is below 620. Before applying for company credit cards, you may need to concentrate on repairing your credit in this situation.
Remember that while it plays a big role, your credit score is not the only one. When choosing, issuers will also consider your company’s income, financial history, and other aspects. Additionally, some lenders could demand a personal guarantee, which makes you personally responsible for the debt if your company cannot make payments.
Consider taking the following actions if your credit score is presently insufficient for you to get approved for the business credit card you want :-
Check Your Credit Reports
Verify the integrity of your credit reports by going through them from the three main credit agencies (Equifax, Experian, and TransUnion). Refute any mistakes you come across.
Pay Your Bills On Time
Paying your bills on time, personally and professionally, will help your credit score.
Reduce Credit Card Balances
A major aspect of your credit score is your credit utilization ratio, which may be raised by reducing your credit card balances.
Manage Debt Responsibly
Avoid taking on excessive debt, and handle the debt you already have wisely.
Build A Positive Credit History
If you are just starting with credit, you may start with a secured credit card or a credit-builder loan.
Business Financial Health
Boost the financial stability of your company by raising sales and keeping thorough financial records.
Submit applications for business credit cards that are compatible with your credit profile. Applying for too many credit cards too soon will hurt your credit score.
It is advised to compare different possibilities, evaluate their credit score requirements, and look for additional qualifying restrictions before applying for a business credit card. Doing this will give you a better chance of getting a card that works for your company.
Can I Get A Business Credit Card Without A Business Income?
Obtaining a business credit card might be difficult, but only possible with company revenue. Many business credit card providers demand evidence of company revenue to determine your capacity to handle and repay credit.
However, certain issuers could provide choices for newly launched companies or startups. Here are some things to think about :-
Secured Business Credit Cards
Several issuers provide credit cards for businesses backed by collateral. With a secured card, you deposit cash as security, and that amount serves as your credit limit. Issuers may relax their criteria for proof of income since the loan line is secured.
If you can provide a personal guarantee, you may still be able to get a business credit card even if you don’t have any company revenue. You will be held personally accountable if your company cannot pay the loan. Many business credit cards may need a personal guarantee, particularly those for new businesses.
Certain issuers may consider your company strategy and anticipated revenue when assessing your application. A solid company plan may show your dedication and potential for future earnings, albeit this is not guaranteed.
Building Credit History
If your firm is young and has yet to earn revenue, you might begin gradually establishing your company’s credit history. To create the groundwork for future credit chances, consider creating a company bank account, establishing trade credit with suppliers, and paying bills on schedule.
If you plan to charge significant business costs to the credit card, the issuer may use them to judge your creditworthiness.
Some corporate credit card providers may consider your good credit history and score when considering your application.
Remember that each credit card issuer has its requirements for acceptance, and some may be more lenient towards companies with little or no revenue. It’s crucial to compare several possibilities, thoroughly read the terms and conditions, and consider contacting the issuer’s customer service to learn more about their needs.
Your startup business credit card choice may considerably impact your new firm’s financial health and expansion. These cards provide many advantages, including rewards and incentives, expense-management software, and travel extras.
Go through the terms and conditions of each card in detail, evaluate your startup’s spending habits, and then decide which card is best for you, depending on your requirements. You may put your startup on the road to financial success by using the advantages of a well-selected credit card.
Frequently Asked Questions
Why do I need an EIN to apply for a business credit card?
An employer identification number, or EIN, is a special identifying number given to your firm by the IRS. It serves as your company’s tax and financial identification. To create a unique credit profile for your company and apply for business credit cards, you need an EIN.
Can I get a company credit card if my firm is just starting and has little income?
Many companies that give business credit cards do have choices for new businesses. Certain cards may have more lenient revenue criteria if you can provide a personal guarantee or seek secured company credit cards.
What distinguishes a personal guarantee from credit card security for a business?
If your firm cannot pay the obligation, you agree to assume responsibility for it personally. Providing a cash deposit that acts as your credit limit is known as collateral, which is often utilized for secured credit cards. Even if your company revenue is modest, both strategies may help you be accepted for a business credit card.
How can I tell which is better—a business credit card with benefits or a lower interest rate?
Your business’s demands determine whether you choose incentives or a reduced interest rate. Rewards may be more useful if you plan to pay down your debt each month. A lower interest rate can be particularly crucial if you anticipate carrying a debt to prevent paying exorbitant interest fees.
Can using a business credit card aid in establishing my company’s credit?
Using a business credit card properly and paying your bills on time will assist in establishing your company’s credit history. A consistent track record of on-time payments is essential to building a solid corporate credit score.
Do I need to fall within a certain credit score range to qualify for a starting company credit card?
Although credit score criteria differ per card and issuer, your chances of being approved for most startup company credit cards are increased if you have a strong to outstanding credit score (usually 680 or higher). Some cards, however, could provide choices for those with fair credit.
Are any business credit cards created expressly for sectors like travel or retail?
Certain business credit cards provide unique incentives or bonuses catered to certain sectors of the economy. There are cards with travel benefits, for instance, for companies that travel regularly, and cards with additional incentives for office supply and advertising costs.
I want to boost my available credit; therefore, may I apply for many business credit cards?
Quickly submitting many credit card applications may temporarily lower your credit score. Applying carefully and exclusively for cards that fit your requirements is advised. Instead of taking on too much debt at once, use credit responsibly.
When I apply for a company credit card, how long does my business credit score rise?
Depending on your credit behavior, your company credit score may take several months to a year to improve. Positive improvements will eventually occur if you consistently pay your bills on time and carefully manage your credit.
Should I keep my personal and company spending separate, or may I use a corporate credit card for both?
Keeping company and personal spending separate is advised for effective financial monitoring and reporting. However, as long as it is carefully recorded and doesn’t become a regular practice, certain company credit cards permit limited personal usage.