Business credit cards offer small business owners access to a flexible line of credit along with a convenient and safe way to pay for business expenses. Many offer cash back rewards, sign-up bonuses, and other perks. If your credit scores aren’t high you may find it more difficult to qualify — but there may still be options available to you. Here we’ll discuss the best credit cards for bad credit and how to get a business credit card with bad personal credit.

What Is Considered Bad Credit?

A bad credit score depends on which scoring system you’re using, usually FICO Score or VantageScore. Credit card providers use one of the available scores to determine if you’re eligible, and you can ask which score the lender uses before applying. 

A FICO credit score of 669 or lower is considered “fair” or bad and can make it more of a challenge to qualify for a credit card. A VantageScore of 600 or lower is considered “fair” or bad credit. It’s usually easier to qualify for a credit card when you have scores in the “good” or “excellent” range. We explore your top choices for the best business credit cards for bad credit below.

Best Credit Cards for Limited or Fair to Good Credit

There may be credit card options available to you even if you have poor credit. Here are some of the top picks for credit cards for small businesses with bad credit.

Capital One Spark Classic for Business

The Capital One Spark Classic for Business is a popular card for those with fair or good credit.

The Capital One Spark Classic for Business may be a good fit for businesses that want to build credit.

BILL Divvy Corporate Card

The BILL Divvy Corporate Card is a great option if you have limited credit history. 

The BILL Divvy Corporate Card could work well if you want to avoid paying interest on your credit card and don’t travel much for business. You’ll pay more to use the card overseas because of the foreign transaction fee.

Secured Business Credit Cards

A secured business credit card is another option when you’re looking for a business credit card for bad credit. Qualifying for a secured card is usually easier than for an unsecured credit card. A secured card requires a cash deposit to be held as a security deposit. (Typically you’ll get it back when you close the account.) This is a way for credit card companies to minimize the risk of a high risk borrower.

Secured cards usually allow borrowers to charge up to the amount of their security deposit, though some will let your balance exceed your credit limit if you manage it responsibly.

Bank of America Business Advantage Unlimited Cash Rewards Secured credit card

The Bank of America Business Advantage Unlimited Cash Rewards Secured credit card is a no-cost business secured credit card built to help establish and grow business credit.

The Bank of America Business Advantage Secured credit card allows cardholders to secure a credit line of at least $1,000. With this card, the amount of your credit line is equal to the amount you deposit. There’s no annual fee.

*All information about the Bank of America Business Advantage Unlimited Cash Rewards Secured credit card has been collected independently by Nav. This card is not currently available through Nav. To see what business credit cards are available, please visit Nav.

First National Bank Business Edition® Secured Visa Card

First National Bank offers a business secured card with a credit limit between $2,000 and $100,000, in multiples of $50. Your security deposit must be 110% of the credit limit that you want, however you will earn interest on the deposit. There is an annual fee of $39.

*All information about the First National Bank Business Edition® Secured Visa® Card credit card has been collected independently by Nav. This card is not currently available through Nav. To see what business credit cards are available, please visit Nav.

Union Bank® Business Secured Visa Credit Card

Union Bank offers a secured card for small business owners with a limit of as little as $500 and as much as $25,000. It also has a low APR of 13.99%. Variable. There’s a $30 annual fee for this card. 

*All information about the Union Bank® Business Secured Visa® Credit Card credit card has been collected independently by Nav. This card is not currently available through Nav. To see what business credit cards are available, please visit Nav.

Wells Fargo Business Secured Credit Card

You may see references online to this credit card as it was a popular option. However, as of January 2024, it’s not available.

Best Personal Secured Cards

It can also be a good idea to look into personal cards as well as business cards. Personal secured cards can help you build credit over time and can be easier to qualify for.

Citi Secured Mastercard Credit Card

While the focus here is on business credit cards, a personal secured credit card may help you build credit if used properly.

The Citi Secured Mastercard credit card is a no annual fee credit card that can help with building credit when used responsibly. A security deposit (minimum of $200) is required. Once approved, your credit limit will be equal to your security deposit. With Citi’s Flexible Payment Due Dates, you can choose any available due date in the beginning, middle or end of the month, then manage your account 24/7 online, by phone, or in the mobile app.

*All information about the Citi Secured Mastercard credit card has been collected independently by Nav. This card is not currently available through Nav. To see what business credit cards are available, please visit Nav.

Discover it® Secured Credit Card

The Discover it® Secured Credit Card is a personal card that also offers rewards and could work well for a business owner looking to earn on everyday spending and build credit.

The Discover it® Secured Credit Card doesn’t charge an annual fee and has a robust rewards program and an intro bonus: You can get a 2x cash back match at the end of your first year. 

The rewards program offers:

• 2% cash back on restaurants and gas stations on up to $1,000 per quarter
• 1% cash back on every other purchase

Pay as little as $200 on the deposit to open this secured card.

*All information about the Discover it® Secured Credit Card has been collected independently by Nav. This card is not currently available through Nav. To see what business credit cards are available, please visit Nav.

Do Business Credit Cards Check Personal Credit Scores?

Yes. Even though you use business credit cards for business purposes, most financial institutions look at your personal credit score to determine if you qualify. This often results in a hard inquiry, which shows up on your personal credit report and may temporarily lower your credit score by a few points. 

In addition to establishing personal credit scores, you can also establish business credit scores. These scores represents your business as a separate entity and its ability to repay what it owes. We discuss how to establish business credit next.

Most business credit cards don’t report activity on your business credit card to consumer credit bureaus, but a few do.

Here’s how some of the major business credit cards affect your personal credit.

How Do I Establish Business Credit?

Knowing how to establish business credit is essential as a small business owner. Although you likely don’t need an established business credit score to get a small business credit card, having business credit can help your business succeed in many ways. For example, a good business credit score can open business funding opportunities that you couldn’t have accessed without it.

It may also allow you to get more agreeable payment terms with your suppliers and vendors, which can make payments less of a hassle for your business. Additionally, if your goal is to work with a Fortune 500 company or a government agency, these institutions will check your business credit to make sure you’re a legitimate business before signing on the dotted line.

The easiest way to establish business credit is to become a Nav Prime member, which comes with an important feature called tradeline reporting. With tradeline reporting, Nav sends positive payment information to the major credit bureaus that track businesses. Plus, you may get a second tradeline by using your Nav Prime Card*, which is available in most states. Your account may help build your business credit with important bureaus. And because life happens, Nav never sends negative information like late or missed payments.

Many business credit card accounts also report to business credit bureaus, but this feature is not universal. So it’s not guaranteed that using a business credit card will automatically establish business credit. If possible, choose a credit card that will report to the major business credit bureaus.

Find a list of vendors that offer tradeline reporting for their customers here.

What If I’m Not Approved for a Business Credit Card?

If you get denied for an unsecured business credit card, you still have options. Before applying for any more of the best credit cards for poor credit, it’s typically a good idea to wait around six months to make sure your credit score doesn’t take too many hits from the hard inquiries. In the meantime, you can take steps to build up your credit score. And when you’re ready to apply again, you can look into a different credit card that accepts applicants with your credit score range. Or you can apply for a secured business credit card that allows you to put down a refundable security deposit, and the deposit acts as your credit limit. Secured cards are typically easier to qualify for than unsecured credit cards.

Don’t waste time scrolling through countless credit cards. Instead, find the best credit card options for your business instantly with Nav.

Legal Aspects to Consider When Applying for Business Credit Cards

When applying for a business credit card, you’ll want to look at more than rewards points and employee cards. There are several legal aspects to also consider to protect your business and make sure you remain compliant. 

Here are some key legal considerations:

• Type of business entity: The legal structure of your business, whether it’s a sole proprietorship, partnership, corporation, or LLC, can impact the way credit is issued and the extent of your liability. Understand how your chosen entity type affects the credit card application and your personal liability as a business owner.
• Personal guarantee: In many cases — especially for small businesses or startups — credit card issuers may require a personal guarantee from the business owner(s). This means that if the business can’t repay its debt, the business owner(s) will be personally responsible for the outstanding balance. Carefully consider the implications of providing a personal guarantee.
• Disclosures and terms: Pay close attention to all disclosures and terms presented during the application process. These documents contain important information about interest rates, fees, grace periods, and other key aspects of the credit card agreement. By applying for the card, you are legally agreeing to these terms.
• Truthful information: When completing the application, ensure that all information provided is accurate and truthful. Misrepresentation or providing false information can lead to legal consequences and possible denial of credit.
• Age requirements: Some business credit cards have age restrictions, typically requiring the business owner to be of legal age to enter into a contract. Verify the age requirements to ensure eligibility.
• Privacy and data security: Understand the credit card issuer’s privacy policy and how they handle your business’s personal and financial information. Ensure that they have adequate data security measures in place to protect your sensitive data.
• Dispute resolution and arbitration: Review the dispute resolution and arbitration clauses in the credit card agreement. These clauses may impact your ability to take legal action in case of a dispute with the credit card issuer.

It’s a good idea to consult with a legal professional or a financial advisor before applying for a business credit card, especially if you have specific concerns or unique circumstances regarding your business. 

Understanding the Terms and Conditions of Business Credit Cards

You often see the phrase “terms apply” with credit cards, but it might not be clear exactly what that means. Business credit cards have terms and conditions that may vary among different credit card issuers — and can be different from personal credit cards. It’s a good idea to read and understand them before applying for or using a bad credit business credit card. 

Here are some key terms and conditions to look out for:

1. Grace period: The grace period is the time between the purchase date and when interest starts accruing on the balance. If you pay your balance in full before the grace period ends, you won’t rack up interest charges.
2. Billing cycle: Know the billing cycle and the due date for your payments. Timely payments are crucial to maintaining a positive credit history and avoiding late fees.
3. Interest rates: Business credit cards come with one annual percentage rate (APR) for purchases (and another APR for cash advances). The APR represents the interest you’ll be charged if you carry a balance on your card after the grace period. Some cards may have a low intro rate that increases after a specific period.
4. Fees: There are various fees associated with business credit cards, like an annual fee, late payment fee, over-limit fee, cash advance fee, foreign transaction fee, and more. Make sure you’re aware of these charges and consider their impact on your business finances.
5. Credit limit: The credit limit is the maximum amount you can charge on your business credit card. Going over this limit may result in penalties, fees, and even a negative impact on your credit score.
6. Rewards and benefits: Some business credit cards offer rewards, such as cash back, travel points, or discounts on certain purchases. Understand the rewards program and any restrictions that may apply.
7. Liability and guarantees: Clarify whether the business credit card needs a personal guarantee or if the liability is limited to the business entity only. You’ll also want to check the fraud liability policy.
8. Credit reporting: Check if the credit card issuer reports your card activity to business credit bureaus. Reporting can help increase your business credit score.
9. Authorized users: Understand the process for adding authorized users to your business credit card account and the responsibilities associated with it.
10. Balance transfer policy: If you plan to transfer balances from other credit cards, review the terms for balance transfers, including any applicable balance transfer fees and promotional rates.
11. Fraud protection: Familiarize yourself with the issuer’s fraud protection policies and procedures to safeguard your business against unauthorized transactions.
12. Termination and changes: Be aware of the conditions under which the credit card issuer can terminate your account or change the terms of the agreement.

Always read the fine print and ask the credit card issuer for clarification if any terms are unclear. Additionally, consider comparing multiple business credit card offers to find the one that best suits your company’s needs and financial situation.

Alternatives to Business Credit Cards for Bad Credit

If you get a business credit card, try to use it for business purchases so you can separate your business and personal finances. This will make it easier to keep track of your business spending for tax purposes.

Many traditional small business loans (such as bank loans or SBA loans) require good credit, but there are some types of business financing that may be more credit flexible or may not check personal credit at all. Lenders that make business loans for bad credit tend to be heavily focused on other factors such as revenues or time in business. They include:

• Vendor accounts
• Online loans
• Business cash advances
• Crowdfunding

For the above types of financing, revenues may be more important than credit history. A business bank account may be required so make sure you open and use one as soon as possible.

FAQs

• Can I get a business credit card with bad personal credit?

  If your credit scores are low it will be harder to qualify for a business credit card. You may need to start with a card with a smaller credit limit, and in some cases you may need to work on your personal credit scores before you can qualify. If your credit scores are low, you may need to stick with personal cards while you rebuild your credit.

• Does opening a business credit card affect your credit score?

  Any hard inquiry into your personal credit can lower your credit score by a few points. However, the effects are typically short term and shouldn’t cause your score to decrease for more than a few months. However, opening several new credit accounts (like credit cards, loans, or lines of credit) within a short period can affect your credit score. So it’s best to try to space out your new accounts as much as you can.

• How to choose the right business credit card with bad credit?

  Because your choices will be more limited if your credit scores are low, you will primarily look for a business credit card that will allow you to establish a payment history. Rewards rates and perks are typically less important than simply finding a card for which you can qualify. Some small business credit cards report to personal credit, some card issuers report to business credit bureaus, and some report to both. On-time payments and low balances can help build good personal and business credit scores.

• What does it take to qualify for a business credit card with bad credit?

  There are two primary qualifications most business credit card issuers consider: credit and income or revenue.
  
  Credit: In most cases, a personal credit check will be required— even for business credit cards. It’s a good idea to check your credit reports and scores from the major consumer credit bureaus— Equifax, Experian and TransUnion— so you understand your creditworthiness. (There are more than 138 places to get your credit score for free.) This can also help you identify problem areas in your credit history where your credit can be improved. For example, high debt utilization is often a problem for consumers and business owners. If your debt ratio is too high, it could be weighing on your scores, and you’ll want to focus on paying down those balances.
  In addition to minimum credit score requirements, some issuers will not approve your application if you have too many recent inquiries, high balances on other credit cards or no credit history.
  
  Income: Issuers will often have minimum income requirements (and they may not disclose those) but the good news is that most will allow you to include income from all sources and not just the business. That means these cards may be available to startups as well as more established businesses.

• How do I apply for a business credit card with bad credit?

  Unless you get appealing credit card offers in the mail, you’ll most likely shop for a credit card online. Most issuers make it easy to apply online and get a decision very quickly. You’ll want to have the following information handy when you apply:
  
  -Your Social Security Number
  -Employer Identification Number (EIN) or Taxpayer Identification Number (TIN)
  -Business information: address and phone number
  
  Note while a few issuers require you to have a formal business entity (such as an LLC or S corp) to apply for most business credit cards, in most cases these cards are also available to sole proprietors, independent contractors and freelancers.
  
  If you get rejected for a card you want, you may want to reach out to the card issuer. Some have a reconsideration department that will review your application to determine whether there are other factors that may help you qualify.

• Can I use my EIN to get a credit card?

  If you have an employer identification number (EIN) you may need to supply it when you apply for a small-business credit card. But you will almost always need provide a Social Security number as well.

• How to get a business credit card with bad credit?

  The most important thing to keep in mind when you apply is to narrow your search to cards for which you are most likely to qualify. Applying for multiple cards in a short period of time can result in multiple credit inquiries on your report. These can impact your credit scores, so be careful to apply for cards for which you’re more likely to get.

• Do business credit cards verify business income?

  Most business credit card issuers don’t verify business or personal income though they may use technology to identify potentially fraudulent applications. Business cards without personal guarantees or personal credit checks may require proof of business income in the form of business bank statements to ensure the business make enough money to repay the debt.

• How long does it take to get a business credit card?

  If you apply for a business credit card online, you may get a decision right away. Sometimes the application goes into review and it can take several days to a couple of weeks to get approved or declined. Once you are approved, it can take a couple of weeks to get the physical card. Some issuers will allow you to use the card number right away through the issuer’s app or by issuing a virtual card number. 

• Can you still get a business credit card if you’ve personally had bankruptcy and bad credit?

  Getting a business credit card after experiencing personal bankruptcy and bad credit can be challenging, but it’s not impossible. Business credit cards often require a personal guarantee, so your personal credit history may still come into play. Lenders will evaluate your business’s financial health, revenue, and potential for future growth. While your personal credit history may be a factor, a strong business plan, improved financial circumstances, and a convincing argument for why your business needs the card can increase your chances of approval. Consider working on rebuilding your personal credit over time, as it can positively impact your ability to secure a business credit card with better terms and limits in the future.

• How do I spot and rectify mistakes on my credit report?

  To fix mistakes on your credit report, start by obtaining a copy of your credit report from all three major credit bureaus (using Nav Prime is a good option). Review each report carefully to identify any inaccuracies, such as incorrect personal information, accounts that don’t belong to you, or errors in your payment history. To dispute errors, contact the credit bureau in writing, clearly explaining the mistake and providing any supporting documents. The bureau will investigate your dispute and contact the creditor for verification. Be persistent and follow up to ensure corrections are made promptly. Additionally, consider using certified mail for documentation and maintaining thorough records throughout the process. Regularly monitoring your credit reports and scores is crucial to maintaining an accurate credit history.

• How long negative entries stay on a business’s credit report?

  Negative entries can stay on a business’s credit report for varying lengths of time, typically between seven to 10 years. The specific duration depends on the type of negative entry. For example, late payments, charge-offs, and collections may remain on the report for 7 years from the date of the initial delinquency. Bankruptcies, tax liens, and judgments can stay on the report for up to 10 years. It’s essential to understand that these negative entries can have a significant impact on a business’s creditworthiness and ability to secure financing. However, over time, their impact diminishes, and proactive efforts to rebuild credit and maintain positive financial habits can help improve a business’s credit profile.

• Can I get a business credit card without good credit?

  Getting a business credit card without good credit can be challenging, but it’s not impossible. Many business credit card issuers evaluate both your personal credit and your business’s financial health when making approval decisions. If your personal credit is less than stellar, you may still qualify for a business credit card by demonstrating a strong business plan, consistent revenue, or a co-signer with good credit. Alternatively, you can consider secured business credit cards, where you provide a deposit as collateral, making it easier to get approved even with poor credit. While these options may have lower credit limits and less favorable terms, they can be valuable tools for building or repairing your business’s credit over time.

*DISCLAIMER: Nav Technologies, Inc. is a financial technology company and not a bank. Banking services provided by Blue Ridge Bank, N.A., and Thread Bank, Members FDIC. The Nav Visa® Business Debit Card is issued by Blue Ridge Bank, N.A. or Thread Bank, and the Nav Prime Charge Card is issued by Thread Bank pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa cards are accepted. FDIC insurance is available for your funds on deposit, up to $250,000 through Blue Ridge Bank, N.A. or Thread Bank, Members FDIC. See Cardholder Terms for additional details.