How to Apply for a Business Credit Card

Applying for a business credit card scares many new business owners, but it shouldn't. It is an important step toward your company's future and one you should make in order to improve your overall business fundability. Business credit cards play an important role in lender acceptance should you need a loan and also provide credit information for consumers and other business owners to base their opinions on regarding the stability and reliability of your company.

In general, when you apply for a business credit card the process mirrors the application process for a personal credit card. However, in order to be sure the credit reporting applies to your business and not your personal rating, there are some items you need for identification in the reporting process.

DUNS Identification Number

A DUNS number is specifically intended as an identification number when reporting credit to agencies. Relying solely on your business name is impossible because there may be many companies with that name throughout the country and even worldwide.

Dun & Bradstreet provides DUNS numbers to any company that applies for it free of charge. It takes several days to obtain your DUNS so make sure you apply for that well in advance of any credit application.

Employer Identification Number

In order to get your DUNS, or even apply for a business credit card you will also need an EIN number. An EIN is also known as an Employer Identification Number, and is issued by the IRS. An EIN takes the place of your personal social security number to identify your business as a separate entity. This is also a free service and you can apply for it online at the Internal Revenue Service website.

What If I Don't Have Those Numbers?

You can apply for a business credit card even if you can't identify your business with the necessary numbers above. However, they will act like a personal credit card when it comes to reporting. That can be good or bad depending on how you look at it, but from a business standpoint it is generally a bad idea. The only reason people sometimes apply for a business credit card without identifying a business is to use it as a personal card and still get the perks offered.

While that may sound like a simple way out, using your personal credit to obtain a business credit card can be disastrous. If your business fails, and even though no one likes to think about that possibility, it is a real threat. You are still personally responsible for the amount of money owed to the credit lender. That isn't even the only problem with your personal credit being associated with a business credit card used for actual business purposes.

Having a large number of credit card debt for your business in your personal credit history may prevent you from getting a credit card when you want it for your own use, or from getting financing for important purchases such as a home or car.

How Long Will it Take to Get a Business Credit Card?

Some business credit card banks offer online applications, and can even tell you in minutes if you have been approved or declined. However, regardless of how you apply, getting the physical card will still likely take one to two weeks.

How Many Cards to Obtain for a Single Account

If you are the person in charge of most purchases for your business, you will likely want to limit the users to just yourself, and a single card will suffice. However, there are instances when having multiple cards for an account is useful. If your company has a fleet of cars or other vehicles, you may not want to be the one responsible for taking them all to get gassed up. Asking for multiple cards so you can issue them to the proper personnel will save you a lot of time. You must keep track of what is being spent and always watch for improper usage when you do that though.

It is helpful to apply for a business limited credit card for those circumstances when possible to decrease the risk of misuse. For instance, if you are supplying the card to drivers for refueling purposes, a business credit card issued by the gas company of your choice is a better bet than a bank issued credit card that can be used for any type of purchase. For your added protection, when a dedicated credit card isn't an option, choose a bank credit card that offers a system to track each individual employee's expenses. As long as you keep track of how the money is spent, using business credit cards this way is a great way to increase your bonuses on each account, and also increase your business fundability.

Improving Your Chances of Successful Business Credit Card Applications

Giving yourself time to develop a credit rating and good business fundability will greatly improve your chances of acceptance. Businesses more than two years old, with several active vendor accounts, and good bank account standings have a much better chance of getting accepted by a credit card company without the use of personal credit backing. Applying for business credit cards with banks that you do business with on a regular basis will also increase your chances of success.


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Corey Pierce is CIO & CTO of CredSystems LLC which has developed http://www.BusinessFundability.com. In cooperation with Experian Business Information Services BusinessFundability.com provides business owners with a free test that allows them to see what any potential lender will see about the fundability of their business and then provides real world answers regarding what to do to increase their fundability.


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