How to Apply for a Business Credit Card to Establish Business Credit

by Contributor; Updated September 26, 2017
With proper research, you can acquire a solid business credit card.

One of the most frustrating parts of running a business is dealing with ways to establish credit. Credit is needed for many financial purposes, so learning to establish business credit will be an essential part of your company’s growth. The easiest way to get started is to apply for a business credit card that will help you build a strong credit rating. Reviewing a few steps can save your business time and money on using a business credit card to establish credit.

Step 1

Check if it is a personal or business credit card. Be certain it is indeed a business account. Many companies will give you a "business credit card" with your Social Security number on an application. While the credit card bears a business name, it will actually go on your personal credit record and will not help you establish business credit. When you apply for real business credit cards, use your Employer Identification Number, EIN, not your personal information.

Step 2

Check if you can get secured or unsecured business credit. Unsecured business credit cards usually have better APR and rewards programs. Unfortunately, a business trying to establish credit cannot usually get an unsecured business credit card. Thus, begin with a secured business card and switch to unsecured once you have established good credit for your business.

Step 3

Compare and research business credit options before applying. Be sure to look and compare the following things before choosing a business credit card. Check the APR to see if there is a jump after the introductory period. Check for the grace period on purchases. Paying off most monthly spending is important to establish business credit. Also, check for any types of annual fees or other hidden fees before applying.

Step 4

Use the Internet and local resources to make a final decision. Going to the bank where your business checking is set up is always a good option. Go there after you have done your Internet research and have comparison offers. It is important to find unbiased information online.

Step 5

Plan to use the business credit card carefully. To be safe and establish good credit, do not carry a balance larger than 10 percent off your total credit limit. Thus, if your credit limit is $10,000, you should not carry a balance more than $1,000. To establish credit, you must use the card monthly. The account should consistently be paid on time to establish positive business credit. To avoid paying APR and extra fees, try to pay as much of the monthly balance as possible.

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