Compare Business Credit Cards

Whether it’s managing cash flow, employee expenses or investing in new equipment, commercial credit cards are a handy tool for growing your business. With so many out there, it’s important to compare business credit cards to find the best one for you.

Compare business credit cards

Coronavirus Update: Credit card providers may have temporarily stopped offering credit cards to customers due to the current Coronavirus (COVID-19) pandemic. This may result in a limited choice available to you.

Last updated October 2020

What is a business credit card?

A business credit card may look and operate like a regular card, but it’s in the business’ name rather than a person’s name.

A business credit card can be used by company directors, employees, sole traders, self-employed and freelancers to make purchases for the business. The business is then responsible for repaying the balance. A company credit card is available to startups and established businesses and can be used for business expenses such as office supplies or travel costs.

How do business credit cards work?

Business credit cards work in the same way as other credit cards. The only difference with a commercial credit card is that the purchases you make should solely be for the business.

The business will have to make payments on the credit card, ideally in full each month to avoid interest.

Advantages of a business credit card

One of the main advantages of having a business credit card is that it can lend a much-needed helping hand to support your business. If you are struggling to purchase supplies or stock, for example, a commercial credit card can help you grow your business faster.

Businesses often suffer from cash flow problems, whether due to unpaid invoices or mismanagement of funds. A business credit card can help you manage cash flow and cover expenses until you get back on your feet.

Another great benefit of getting a business credit card is that you can easily separate debts and purchases from personal ones. Using your personal credit card to pay for business purchases can get a bit confusing, especially when it comes to filing tax returns. A company credit card allows you to keep personal and business finances separate.

Some other advantages of using a business credit card include:

  • Cashback and rewards - Some business credit cards will offer rewards such as cashback, travel credits, discounts or reward points. Air miles and travel points can also help to keep your expenses down if you need to travel for business.
  • Large spending limits - Business cards tend to have much greater credit limits than personal credit cards. Businesses typically have many more expenses than the average person, so a business credit card is ideal for those big or regular purchases you need to make.
  • Easier to manage employee spending - If your employees need to purchase things for the business such as supplies, the business must reimburse them. An easier way of managing this is to have a company credit card that employees can use without them having to spend their own money. This can save a great deal of time that you would otherwise spend on processing expense claims.

Disadvantages of a business credit card

There are also some important disadvantages to be aware of if you are thinking of opening a new business credit card.

The main thing that trips people up is unmanageable debt. A credit card is a convenient way to make purchases, but if not used wisely, the credit card debt can quickly get out of control. With typically larger credit limits, the potential to run up a high level of debt is a real risk to be aware of with business credit cards.

Remember: If you’re a small business or are self employed and are struggling with business debt, you can get free business debt advice from the Business Debtline.

Using a credit card to bridge cash flow problems is helpful, but if unpaid invoices start building up, you may not be able to pay your balance off each month. This can lead to high levels of interest to pay off.

Some other disadvantages of a business credit card to be aware of include:

  • It’s an expensive way to borrow money - Having a credit card is a fast and simple way to cover expenses, but the interest can end up costing you a lot.

Remember: If you’re looking for help to manage cash flow issues, another alternative is to take out a business loan which will have a fixed interest rate and more manageable loan terms.

  • Employee spending can get out of hand - When handing business credit cards out to multiple employees, it can be harder to maintain control overspending. In this case, it’s best to have clear policies in place that employees can refer to.
  • Not everything can be paid via credit card - Some companies such as suppliers will expect payment through bank transfer and may not accept credit cards.

Credit cards for the self employed

If you’re self employed, a sole trader or freelancer in the UK, it’s always a good idea to keep personal finances away from your business finances. Although there are no specific ‘credit cards for the self employed’, the majority of card providers will consider your application.

Business credit cards for startups

Starting a business is not easy. With zero or limited trading history, you may find it even harder to secure credit, such as a business credit card or loan to help with startup growth.

The good news is that some providers offer credit cards designed for startup and small businesses in the UK. To find the best credit card for your startup, we recommend comparing providers as some may offer more benefits for you than others.

How to choose the best business credit card

To choose the best business credit card, you will need to consider what is important to your business. Interest rates and charges are crucial when deciding, but also think about other features that could benefit you, including:

  • Offers and rewards such as airmiles and cashback
  • Good ratings and customer service reviews
  • Mobile app that allows you to check balance and track spends

You will need to spend some time comparing credit cards for businesses. A good place to start is by using a free comparison site like Cardsense. This will help narrow down your choices and will allow you to select the best provider for your needs.

Business credit card FAQs

We have listed out some frequently asked business credit card questions.

Many business owners find company credit cards useful for a number of reasons. If you wish to keep your personal and business credit separate, manage cash flow or reduce time spent on employee expenses, then a credit card may be worth getting.

Yes, it can. When you apply for a business credit card, providers may check your personal credit score, especially if you're a new business applying. Also, if your business falls behind on payments, it can negatively impact your personal credit score, so keep this in mind next time you put an expense on your company credit card.

A business credit card is available to all UK registered businesses from new start-ups to the self-employed. However, not all cards will be available to you as there will be certain requirements your business has to meet. For example, some providers may need your business to turn over a certain amount per year to qualify. It’s always good to check the provider's eligibility criteria before applying.

Yes, there are startup business credit cards that are designed for new companies in the UK. If you are a startup without much business credit history, you may find it more difficult to get accepted. Lenders may offer you a lower credit limit or higher interest rates in this case.

If your business has bad credit, it may be a little bit more challenging to get a credit card. However, some providers will welcome companies with poor credit history but expect higher rates and lower credit limits.

Improving your credit score before you apply will benefit your business. It will open up a wider selection of credit card products and give you access to better rates. Find out your credit score and ways to improve it for free at Credit Passport.

This depends on the card and bank you go with. Many business credit cards will charge annual fees or a percentage on transactions. Some cards may also have introductory offers which make the card free for the first year.

Providing payments are made on time; a business credit card can help build your credit history and improve your credit score.

No. It is unlikely you will find a business credit card that offers no credit checks. All UK card providers will require you to have a credit check when you apply, but there are options for businesses credit cards out there designed for bad credit.

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