Best Credit Card for Small Business: How to Choose the Right Card for Your Company

Whether you’re a limited liability company (LLC) or an S corporation, finding the best credit card for small businesses can help you take the next step in managing your company’s expenses. Business credit cards are essential tools for building your company’s credit history and making your company eligible for future business loans.

However, each credit card comes with unique advantages and disadvantages. To find the right option for your needs, you’ll need to consider all of the fees, interest rates, rewards, spending controls, and perks involved.

To help you find the right choice for your business, we’ll dive into the top small business credit cards, important features you should consider, and which card types make sense for different types of situations.

TL;DR

• Business credit cards can help you build your credit history, manage expenses, and track employee spending.
• Cash back and travel rewards cards provide you with money and perks in exchange for your purchases. Often, cash back cards will give you 1.5% to 2% of your purchase amount back.
• If you need to build credit, secured cards allow you to make a deposit as collateral before making purchases each month.
• With 0% APR promotions, you can make purchases without paying any interest for a set amount of time. These cards are a good option if you want short-term, low-cost financing.
• If you spend heavily in just one or two categories, find a card that offers a bonus cash reward for specific categories.
• Make sure the card you get has an appropriate credit limit for your spending needs.
• Expense management tools can help you track employee spending, receive spend alerts, open up virtual cards, and gain oversight into your finances.
• Some common credit card types include cash back cards, 0% intro APR cards, travel rewards cards, procurement cards, revolving cards, fleet cards, secured cards, vendor-specific cards, and virtual cards. 
• With the best credit cards for small business owners, you can separate your personal and business finances. 

Credit cards can also simplify your AP processes and receipt matching. They provide enhanced analytics, travel protection, and rewards benefits.

How To Choose the Best Credit Card for Your Small Business

When choosing the top small business credit cards, there are different factors you should think about. Your credit history is just one consideration. You’ll also want to look at the card’s fees, annual percentage rate (APR), expense management tools, and other factors. To get you started, we’ve compiled a list of what to look for in the best credit cards for small businesses.

Rewards

Many top small business credit cards offer cash back rewards, travel rewards, or category bonuses. 

• Cash Back: Cash back rewards are the most common. With this option, you end up getting a percentage of the purchase back.
• Travel Rewards: Meanwhile, travel rewards are effective if you travel enough to take advantage of reward points for flights or hotels.
• Category Bonuses: On top of the previous options, many cards also provide category bonuses. This means you earn an extra amount back for specific categories instead of just getting a flat rate.

Fees

Each credit card company charges different types of fees. Depending on the card, you may be charged an annual fee. However, some cards don’t charge annual fees. Often, these cards charge higher interest rates instead.

Besides annual fees, you will also have foreign transaction fees, late fees, and balance transfer fees. These can vary significantly from card to card, so research the total fee amount before making a decision.

APR

The APR is an interest rate that is charged if you carry a balance on your card from one month to the next. If you pay your card in full, the APR amount doesn’t really matter because you won’t have to pay it. Some cards also offer 0% APR promotions, which are a good choice if you need a temporary reprieve from interest rates or have the ability to pay in full by the end of the promotional period.

Credit Requirements

Many of the best credit cards for small business owners have specific credit score requirements. If you don’t have a credit history, the best option is to get a secured card. These cards allow you to deposit a set amount. This reduces the issuer’s risk while allowing you to build credit.

Spending Categories

Before you get a credit card, consider which spending categories you typically use. If you primarily spend in one to three categories, you may want a card that offers category bonuses. This allows you to get extra credit card rewards on your most-used categories.

Credit Limits

For your credit card to be useful, it needs the right credit limit. If you are just building credit, you’ll likely be offered a lower limit than a more established company.

Expense Management Tools

Whether you’re interested in virtual card issuing or fleet cards, credit cards offer helpful expense management tools. For example, you can get employee cards that have set limits. Credit cards offer receipt capture tools, accounting integrations, and spend alerts. Plus, virtual cards are a safe way to pay for online transactions and subscriptions.

Real-World Usage Needs

Before selecting a specific credit card, consider your real-world usage. 

• Everyday Expenses: If you’re getting a card for everyday expenses, a cash back card is a good option. This is especially true if you plan on paying in full each month and don’t have to worry about the APR.
• Travel: For companies that spend a lot of money on business travel, travel cards are an excellent choice. Besides offering travel rewards, they also generally provide additional travel protections.
• Short-Term Financing: If you need short-term financing for a low price, look for a card that offers a 0% intro APR.
• Building Credit: Secured cards are easy to qualify for and are an effective way to build credit.

Types of Small Business Credit Cards and When To Use Them

To give you a better understanding of the best credit cards for small businesses, we’ve broken down a list of the different card types. You’ll need to consider your goals, credit card rewards, APRs, and credit history before deciding on a specific card type.

Credit Card Type	Ideal For	Key Advantages	Things To Remember
General Purpose Business Credit Card (Revolving Credit)	This is the basic option for merchants. It allows you to buy online, purchase inventory, and pay for other operational expenses.	These cards are simple to use and widely accepted by vendors.	Over time, interest costs can add up if you carry an ongoing balance.
Business Rewards Credit Card	This option is ideal if you spend across multiple categories and want a basic option that gives you convenient rewards.	Depending on the card, you’ll often get 1.5% to 2% cash back or receive other rewards. It makes tracking expenditures easy.	The rewards often mask the added fees and costs associated with these cards. Additionally, the limits may not be high enough to purchase inventory or handle your operational purchases.
Pay-in-Full Business Credit Card	You can use these cards for high-value purchases, like vendor payments and bills.	It is ideal for companies that plan on paying each statement in full and want a higher spending limit.	Because you aren’t allowed to have a carrying balance, late payments and fees can end up costing you significantly.
Procurement Card (P-Card)	These are typically given to employees for approved expenditures, purchasing office supplies, and similar costs.	P-cards are easier for accounts payable (AP) departments to track and feature real-time controls.	Besides the inconvenience of setting these up for your employees, you also have to control access to them at different locations.
Corporate Cards	Corporate cards are used for broader purchases than P-cards, such as travel and entertainment.	These offer easy expense capture and are useful if you have multiple employees who need to make purchases.	Because they allow for larger purchases, there is a higher potential for misuse.
Fleet Card	A fleet card or fuel card is given to workers so that they can fill up their company vehicle with gas, pay tolls, or cover other vehicle maintenance costs.	You can use these cards to track spending per driver and gain better analytics of how much fuel is costing your company.	These cards are limited to vehicle-related uses, which means you’ll need an alternative for other purposes.
Virtual Cards	These cards are effective for online purchases. Single-use card numbers are also a good choice for security and one-time vendor payments.	Virtual and single-use cards are good for reducing the incidence of fraud and are easy to issue.	Unfortunately, these cards aren’t accepted by every merchant. Specifically, they don’t work for transactions where the card must be present.
Vendor or Store-Specific Cards	You can use these cards to make purchases at a single supplier.	These cards are ideal if you make a lot of purchases at a single vendor or store. Additionally, they also feature rebates or promos.	However, these cards are generally only an option for the specific vendor that issued the card. They also might not be an effective way to build your payment history.
Cash-Back Cards	These cards give money back for making purchases.	They are an effective option if you frequently purchase items for your company because they effectively reduce the cost of each purchase.	There are often category caps or limitations that limit the card’s usefulness.
Travel Rewards	Travel rewards cards are for purchasing tickets and hotels. You get points and travel rewards in exchange for spending more.	This option is effective if you or your workers frequently have to travel for your company.	Often, these cards charge annual fees. There may also be blackout dates.
0% Intro APR	These cards don’t charge an APR for a set amount of time.	This kind of card is an excellent choice if you plan on making a large purchase and want to minimize your APR for a while.	Once the promo ends, the interest rate jumps up again. If you haven’t paid the card off by then, the costs can quickly add up.
Secured or Credit-Building Cards	A secured card is backed by a deposit. It’s low to no risk for the issuer and a way for your business to build credit.	These cards are easy to get and a good way to build credit.	You must provide a cash deposit as collateral. Secured cards often involve minimal rewards as well.

Popular Examples of Small Business Credit Cards

There are many different card options for companies to choose from. The following are some of the best credit cards for small business owners.

• The Chase Ink Business Preferred® Credit Card: If you have a travel-heavy business, then this card might be worth the annual fee. It offers three times the normal points for travel, shipping, and a few other categories. 
• The Chase Ink Business Unlimited® Credit Card: This is a simple reward plan with no annual fee. You’ll typically get a 0% introductory APR and 1.5% cash back on all of your purchases.
• The Chase Ink Business Cash Visa Credit Card: With this card, you can maximize your cash back across a range of categories. Select business categories offer up to 5% cash back, and you can enjoy paying a 0% APR for the first 12 months on purchases. It does not have an annual fee.
• Amex Blue Business Cash™: This is a straightforward cash back plan that provides 2% cash back, up to an annual cap. Once you reach the cap, you can get just 1% cash back. There’s no annual fee.
• Amex Blue Business® Plus: With this card, you can get twice the normal member’s rewards points, up to the yearly cap. Like the previous Amex card, there is no annual fee. 
• Amex Business Gold: The Amex Business Gold card lets you get four times the normal points amount for your top two categories each billing cycle. It has an annual fee of $375.
• Capital One Venture X Business: This Capital One card is good for frequent business travelers, but it charges a $395 annual fee.
• Capital One Spark Cash Plus: With this pay-in-full card, you can get an unlimited 2% cash back on your purchases. However, there is an annual fee involved.
• Capital One Spark 1% Classic Credit Card: Through this card, you can enjoy having no annual fee and 1% on all of your purchases.
• Bank of America® Business Advantage Unlimited Cash Rewards Secured: This card has a fairly easy approval option and helps businesses build credit. The secured card offers 1.5% cash back on your purchases.

U.S. Bank Triple Cash Rewards World Elite Mastercard®: With this card, you can get 3% cash back in key categories. It also provides a 0% APR introductory offer.

The Benefits of Getting a Business Credit Card for Your Company

By taking advantage of the best credit cards for small businesses, you can enjoy a few essential benefits.

• Easily Separate Personal and Business Expenses: Using a credit card for purchases makes recordkeeping much easier for your company. It makes filing taxes, tracking write-offs, and monitoring profits much easier. Additionally, keeping your personal and business expenses separate helps to minimize your personal liability.
• Improved Financial Management: Using a credit card can help you easily track your cash flow. You can easily set limits for your employees and monitor their expenses.
• Added Rewards and Perks: When you use rewards or travel cards, you can get cash back rewards and other perks for making the exact same purchases. For instance, you can get extended warranties, travel insurance, and purchase protection.
• Simplified AP Processes: With credit cards, your AP department can deal with fewer invoices. Additionally, credit card statements make it easy to match receipts to purchases. 
• Better Data for Reporting and Analytics: Credit cards offer many types of analytic tools that allow you to see transactions by month, employee, location, or category. As a result, this makes accounting processes easier and gives you better financial oversight of how your company spends money.

How PayCompass Offers Payment Solutions

At PayCompass, we offer the best payment processing tools, chargeback prevention services, and customer support. Like the top small business credit cards, our payment processing options offer the latest analytics and financial management tools. You can gain better oversight into your company’s processes, leading to fewer instances of fraud, less waste, and better profitability. 

Besides our POS options and payment gateway, we also offer virtual card issuing solutions. This allows you to control spend and manage employee expenses. In real time, you can track spending habits and see where you’re spending the most. Plus, these virtual cards can be conveniently integrated into your broader payment stack.

Final Thoughts

By determining the best credit cards for small business owners, you can take the first step in building your company’s credit score. The top small business credit cards can provide you with cash back on your purchases, travel rewards, and 0% intro APR.

To choose the right credit card, you need to match your company’s needs to what the card offers. For example, you should review your spending categories, credit needs, and expense management goals. You should also check out each card’s fees, APR, reward options, expense management options, and promotional offers. 

Through your credit card, you can simplify your AP tasks, gain better financial visibility, and reduce your personal liability. To learn more about the best credit cards for small businesses, reach out to our team of payment processing experts today.