Are You Eligible to Open a Business Credit Card? Everything You Need to Know

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Are You Eligible to Open a Business Credit Card? Everything You Need to Know

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Wondering if you are eligible to open a small business credit card to earn more travel rewards? You might be surprised at the answer. And trust me, it's less intimidating than you may think.

Many of the top points programs like Chase Ultimate Rewards, American Express Membership Rewards, Capital One Venture Miles, and even individual airlines and hotel programs offer business cards that earn the same points (and sometimes even more of them) as their standard consumer cards – allowing you to keep adding to your points total, so long as you can get approved for a card.

But remember: Credit cards are serious business. You should never apply for a credit card if you're already in debt, and never charge more to a credit card than you can afford to pay off immediately. That's especially true when looking at business credit cards, as the spending required to earn a big bonus is often much higher than what you will find on the consumer card side of things.

But even if you're ready, getting a business credit card comes with a unique set of considerations and complications. Let's walk through everything you need to know about getting and using a small business credit card.

 

Who Can Apply for a Business Card?

To open a business credit card, you don’t need a full-time business with employees or six-figure revenues.

While that situation would obviously qualify you to open a business credit card, you can also qualify and be approved for a small-business credit card with a part-time side hustle, a freelance job, a gig economy job, or even by selling goods on online marketplaces like Etsy, Facebook Marketplace, Craigslist and more.

At the end of the day, if you are selling any goods or services, or contracting with a company to do so in an attempt to make a profit, you have a small business and thus are typcally eligible to apply for a small business credit card. That makes it possible for just about anybody to apply for a business credit card.

Just keep in mind: You should never lie or attempt to mislead a bank when applying for a business credit card. It's important to have a legitimate business, even if that business is just your own.

 

You Don't Need a Formal Business Structure

Anybody who operates a business – big or small – is eligible to open a business card. And when it comes to business structures you'll find five common options.

  • Sole Proprietorship
  • Partnerships
  • Corporations
  • Non-Profit
  • Limited Liability Company (LLC)

When applying for a business card, you'll be required to select your business structure during the application process. Big corporations and LLCs will have more formal structures with a tax identification number (TIN). That will be required during the application process so you'll need to have that information handy.

But if you are a very small business without any formal structure, you can choose “sole proprietorship” during the application process. If you're a sole proprietor, you'll simply use your social security number (SSN) on the credit card application like you would for a personal credit card. No formal business documentation is required.

Related reading: Master Guide to Credit Card Applications: All the Rules You Need to Know, Bank by Bank

 

What You'll Need to Apply for a Business Credit Card

Generally speaking, applying for a business card is pretty straightforward.

You'll need basic information like your role with the business, name, address, and your own social security number.

You'll also need some basic information about the business itself like the business structure (as discussed above), the business's legal name, the business address, the number of employees, when the business was established, annual revenue (which can be an approximation), and typically you'll have to provide an estimation of your monthly spending on the card.

 

business card application

 

You'll also have to choose a category in which your business operates in. Oftentimes you won't find an exact match to what your business is, but you can pick something close enough … otherwise, the category “other” should suffice.

One thing to be aware of on the business credit card side of things is that getting instant approval after an application is a lot less common than what you will find on the consumer card side of things. It does happen, but often times, the bank will need to verify some of your information which just takes more time.

If you don't get instant approval, we also recommend calling the bank's credit card reconsideration line which should help expedite the process. Here's the list of reconsideration numbers:

 

Credit Card IssuerReconsideration Line Phone Number
American Express1-800-567-1083
Bank of America1-866-422-8089
Barclays1-866-408-4064
Capital One1-800-625-7866
Chase1-800-945-2006
Citi1-800-695-5171
Discover1-800-3472683
U.S. Bank1-800-947-1444
Wells Fargo1-800-869-3557

 

Can You Use a Business Credit Card for Personal Use?

On top of the ability to earn more points, one of the primary reasons small business owners opt to get a small business credit card is to separate their personal expenses from expenses they incur from their business.

That said, there is nothing preventing you from charging your personal expenses on a small business credit card. Obviously, you just wouldn't be able to report those expenses at tax time if they are not legitimate business expenses, and combining both types of transactions on the same credit card could make things a bit fuzzy and a challenge to untangle.

Most card issuers do state as part of the terms of business card agreements that putting personal spending on your business card is off-limits. For example, on an application for the Chase Ink Business Cash® Credit Card, you'll find the following language in the terms and conditions:

“This is a business account that shall be used only for business purposes and not personal, family, or household purposes.”

In practice, this isn't enforced and would be very difficult to do so unless it was being heavily abused with a large purchase volume.

If you are simply putting your personal expenses on a business card to help meet the minimum spending requirement to earn a bonus, you should have nothing to worry about. I've done this many, many times over the years without any issues.

 

The Best Business Credit Cards to Consider

If travel is your ultimate goal, you'll want to focus on cards that earn flexible credit card points like Chase Ultimate Rewards, American Express Membership Rewards, and Capital One Venture Miles.

All of these banks offer personal cards that earn extremely valuable points, and there are a handful of business cards that will allow you to keep earning those same points.

Otherwise, make sure to check out our Top Business Credit Card Offers.

 

Chase Ink Business Cash Cards

First, there is the suite of Chase Ink Business cards. You'll have three options to choose from.

The Chase Ink Business Preferred® Credit Card will earn you 100,000 Chase Ultimate Rewards points after spending $15,000 in the first three months of card membership. You'll also earn 3x points per dollar spent on the first $150,000 spent on travel and select business categories each year.

With those points, you'll have the ability to send them to a valuable array of Chase transfer partners or redeem your points through the Chase Ultimate Rewards Travel portal for 25% more value.

 

chase ink business preferred card

 

Click Here to learn more about the Chase Ink Business Preferred Credit Card.

 

Then there are the Chase Ink Business Cash® Credit Card and the Chase Ink Business Unlimited® Credit Card.

While these cards technically earn cash back, you can turn that cash back into valuable Chase Ultimate Rewards points as long as you hold a card that earns them. That includes the Chase Sapphire Preferred® Card and Chase Sapphire Reserve® or even the Chase Ink Business Preferred® Credit Card mentioned above.

Best of all, neither of these cards charges an annual fee, making them a great addition to your Chase card portfolio if you are eligible for a Chase business card. Here's a rundown of all three cards and their current sign-up bonus offers.

Both cards are currently offering bigger bonuses for a limited time. You'll earn $900 cash back (or 90,000 Chase points) after spending $6,000 in the first three months of card membership. This is a limited-time offer!

The biggest difference is that the Chase Ink Unlimited will earn a straight 1.5x points (1.5% cash back) on all purchases, while the Chase Ink Business Cash will earn 5x points (5% cash back) on internet, cable, and phone service; office supply purchases on your first $25,000 of spending each year, 2x points (2% cash back) on restaurants and gas stations on your first $25,000 of spending each year, and 1x points (1% cash back) on all other eligible spending.

 

chase ink business cash card

 

Click Here to learn more about the Chase Ink Business Cash Credit Card. 

 

chase ink unlimited card

 

Click Here to learn more about the Chase Ink Business Unlimited Credit Card.

 

Business Cards and the Chase 5/24 Rule

The Chase 5/24 rule is a hard-and-fast restriction rolled out years ago in order to limit card applicants from opening credit cards for the sole purpose of earning bonus rewards. If you've heard of the phrase “churning,” that's exactly what this rule is designed to crack down on.

Here's what it boils down to:

  • If you have opened five or more credit cards in the past 24 months from any bank credit card issuers (not just Chase cards), you will not be approved for Chase credit cards, regardless of your credit score or history with Chase bank.
  • The rule does not count credit inquiries, but rather new cards you have applied for and been approved.

However, business credit cards work a bit differently with the Chase 5/24 rule. When it comes to Chase business credit cards specifically, you'll need to be underneath the 5/24 rule to get approved … but that approval will not add to your 5/24 count. That said, there are recent reports that Chase has relaxed this particular restriction lately, allowing travelers who are above the 5/24 count to get approved.

For example, let's say you want to apply for the Chase Ink Preferred® Business CardIf you've opened five or more credit cards in the last 24 months, you'd almost certainly get denied. But let's say you've opened four credit cards over the last two years. You could get approved … and if you do, you'd remain at 4/24 under this rule.

In general, most business card approvals do not count toward your 5/24 total. That includes business cards from American Express, Chase, Citi, Bank of America, and more.

The reason? Business credit card accounts typically don't show on your personal credit report.

Read More: The Chase 5/24 Rule: Everything You Need to Know

 

American Express Business Cards

American Express has a suite of business cards that earn the same American Express Membership Rewards points you'll earn from personal cards like The Platinum Card® from American Express and the American Express® Gold Card.

First, there is the American Express® Business Gold Card which offers 70,000 Membership Rewards points after spending $10,000 in the first three months of card membership. But we've seen targeted offers much, much higher than that – and even bonuses as big as 110,000 points for the same spending requirement when opening an application page in an incognito window!

You'll also earn 4x points per dollar spent on two categories where your business spends the most each month (1x earned for other purchases) like advertising, gas stations, restaurants, and more on up to $150,000 spent each year.

The card has a $295 annual fee (see rates and fees).

 

amex business gold card

 

Click Here to learn more about the American Express® Business Gold Card.

 

Next, there's The Business Platinum Card® from American Express – the top dog in the American Express business card portfolio.

It starts with a welcome offer of 120,000 Membership Rewards points after spending $15,000 in the first three months of card membership – though, again, we've seen targeted offers much, much higher. You'll also earn 5x points on flights and prepaid hotels booked through amextravel.com.

You'll also earn 1.5x points on all eligible purchases at U.S. construction material and hardware suppliers, electronic goods retailers, software and cloud system providers, and shipping providers, as well as on any eligible purchase of $5,000 or more on up to $2 million spent in these categories each year.

The card comes with some of the best lounge access you'll find from any card – including complimentary access to the Amex Centurion Lounges, the Delta Sky Clubs (when flying Delta), a Priority Pass Select membership, and more.

Finally, the card provides over $1,000 in statement credits on select purchases, including tech, recruiting, and wireless, an annual credit of up to $189 to cover the cost of a CLEAR® membership, up to $100 every four years to cover the cost of a TSA PreCheck or Global Entry Membership, and much more.

The card has an annual fee of $695 (see rates and fees).

Read More: A Full Review of the Business Platinum Card from American Express

 

amex business platinum card

 

Click Here to learn more about The Business Platinum Card® from American Express.

 

Finally, there is a no-annual-fee business card (see rates and fees) in the American Express portfolio that we think is a really solid option. It's The Blue Business® Plus Credit Card from American Express, and it starts with a welcome offer bonus of 15,000 Membership Rewards points after you spend $3,000 in the first three months of card membership.

You'll earn 2x points per dollar spent on all eligible purchases on up to $50,000 spent each calendar year.

 

amex blue business plus card

 

Click Here to learn more about The Blue Business® Plus Credit Card from American Express.

 

Capital One Business Cards

Looking to add to your stash of Capital One Venture Miles? Capital One business credit cards earn Spark Miles, but if you hold a Capital One business card alongside a personal card like the Capital One Venture X Rewards Credit Card, you can easily combine Spark Miles and Venture Miles.

The Capital One Spark Miles for Business card offers 50,000 miles after spending $4,500 in the first three months of card membership. You'll also earn 2x miles per dollar spent on all purchases.

The card also offers up to a $100 credit to cover the cost of TSA PreCheck or Global Entry once every four years.

The Spark Miles for Business card has a $0 introductory annual fee and then $95 each year after that.

 

capital one spark miles for business card

 

Click Here to learn more about the Capital One Spark Miles for Business.

 

Bottom Line

To open a business credit card, you don’t need a full-time business with employees or six-figure revenues.

If you are selling any goods or services or contracting with a company to do so in an attempt to make a profit, you have a small business and thus are eligible to apply for a small business credit card. That makes it possible for many, many Americans to open a business credit card.

 

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.

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