As your business grows, you may find that you simply can ’ triiodothyronine handle your clientele expenses with merely a humble commercial enterprise card. Some little occupation credit rating cards aren ’ deoxythymidine monophosphate set up for an outright number of users, while others might lack proper track and spend tools that are a necessity for larger companies. These problems can be solved by bodied cards — but the serve of getting a corporate menu international relations and security network ’ t precisely aboveboard. If your ship’s company is in the grocery store for a corporate credit menu, but you aren ’ t certain where to get started, don ’ thyroxine concern — you ’ rhenium not alone. Despite increasing popularity, corporate credit cards are still a mystery to many business owners.
It ’ s not surprising. personal and small business credit cards are omnipresent, but you ’ re unlikely to encounter advertisements for corporate credit cards in your casual travels. You besides won ’ metric ton find on-line sign-up forms for bodied credit cards, so it ’ s not constantly slowly to figure out how to apply .
That ’ s where this bit-by-bit guidebook comes in. We ’ ve arrange in hours of inquiry — both by trawling the web and by talking to diligence experts and decision-makers — to uncover the best direction for companies to pursue a corporate circuit board. Keep on interpretation to learn how to get your business a corporate circuit board .
What Is A corporate Credit Card ?
corporate credit cards work similarly to convention credit cards. They can be used to make purchases on credit, which must then be paid off ( either over a period of time or by the next bill cycle ). They besides offer valuable rewards for spend — precisely like most credit rating cards on the market today. however, corporate credit cards besides give companies spend tracking tools, the ability to give employees cards, and more perks built to entice large organizations .
How Is Getting A Corporate Card Different From Getting A Small Business Credit Card?
corporate cards tend to be specifically targeted at large companies. As such, smaller businesses ( such as lone proprietorships or unincorporated businesses ) won ’ t benefit from corporate cards — and may not tied be eligible to apply. If you run a smaller business, we recommend checking out some of the best small occupation credit cards rather of venturing down the bodied menu road .
How To Get A Corporate Credit Card
The process of getting a corporate credit calling card differs slightly from that of a regular credit menu. That ’ mho why we ’ ve created a bit-by-bit scout to help :
1) Determine If You’re Eligible For A Corporate Card
One of the winder things we ’ ve found in our research is that while some requirements for different corporate credit rating cards may vary, most are the same. One park requirement that should come as no storm ? Your business must be a corporation ! specifically, your business must be formally incorporated as an S-corp, C-corp, or LLC. For more data on what this means, check out our template to different types of business structures .
other stipulations may be more change. For example, American Express requires corporate cardholders to operate with at least $4 million in annual revenue. Brex, interim, demands that cardholders have at least $50,000 in the bank for some product lines. Others might require expected annual credit card charges of at least $ 250,000, a minimal count of card users within a company, or that a party has at least one year of business history .
These rigorous requirements aren ’ thymine besides shocking. Because the issuer will be dedicating agio customer confirm services to your company — and without the protection of a personal guarantee — they ’ rhenium looking for an report with some dangerous punch .
2) Consider The Pros & Cons Of Getting A Corporate Credit Card
- Streamline your company’s incidental and travel expenses
- Protect your personal assets
- No personal guarantee required
- Tracking and controlling employee expenses
- Business must generally be well-established
- Eligibility requirements extend beyond personal credit
- Need to demonstrate good corporate accounting practices
Before fully committing to corporate cards, we recommend weighing the advantages and disadvantages they might bring to your company. One major advantage of corporate cards is that they streamline your company’s incidental and travel expenses. This means your employees won ’ t have to dip into their personal funds, and your company will be spared the fuss of managing cumbersome expense reports .
“ I ’ ve been using the bodied card for quite some time now to manage our office expenses, ” said Chris Panteli, director of LifeUpswing. “ I am quite felicitous with the features that it comes with. We were using a individual wag earlier, which was cumbersome to manage. Having a discriminate card for each expense pass has helped us a big deal. ”
Personal Asset Protection
Another bodied card perk up is that the bank cannot come after your personal assets. That ’ randomness because corporate credit cards don’t require a personal guarantee. alternatively, corporate credit cards place the liability on the company ( or, in some cases, the employees making purchases — step 4 has more on corporate accredit card liability ) .
Tracking Employee Expenses With Corporate Cards
so far another benefit : corporate cards are bang-up for tracking and controlling employee expenses. You ’ ll be able to review the nature of your employees ’ spending with a minimal of dither. This can minimize unnecessary spend while cutting down on deceitful purchases .
“ You might be able to identify imposter before it gets out of hand if you keep lead of where charges are being placed within your company on a frequent footing, ” said Imani Francies, a business finance expert at FreeAdvice.com. “ Many credit cards have spending limitations adenine well, so you can establish a monthly stipend for workers. This is utilitarian in situations when workers make even monthly expenditures. ”
Drawbacks To Getting A Corporate Card
On the downside, your business must broadly be well-established before you can even think of getting a corporate citation card ( see the eligibility requirements from the previous step ! ). You won’t be able to rely on your personal credit score to get a corporate credit card. You ’ ll besides need to demonstrate good corporate report practices. Banks will want to see good cash flow, for exercise .
3) Check Your Business Credit Score
Because corporate cards don ’ metric ton hold any individual person personally liable, issuers won ’ metric ton look at personal citation histories during the blessing serve. alternatively, an issuer might consider your party ’ south occupation citation score .
unfortunately, unlike with your personal credit score, you can not obtain a free business credit report from the major credit rating chest of drawers. fortunately, there are plenty of low-cost services around that provide you with access to your business credit rating composition, including Nav, Dun & Bradstreet, and Experian. And, at the end of the day, a occupation credit score functions similarly to a personal credit sexual conquest .
Business Credit Repair
“ You should know that improving your business credit sexual conquest is not wildly unlike from handling personal credit, ” said Giovanni Braghieri, CEO of MyConsultingCoach. “ Paying bills on time, keeping citation use low, and adding positive citation lines are solid foundations for an excellent credit mark. It ’ south worth considering buying off the debt from the collection agency, i.e. ‘ deleting ’ it. In case your company ’ randomness already run into some trouble, hiring a credit repair company is a decent first pace to fixing it. ”
Check Business Credit With Credit Bureaus
Braghieri ’ randomness advice echoes what we ’ ve found in our research. Start by making sure that your clientele has established accredit with the boastful three business citation chest of drawers ( Dun & Bradstreet, Equifax, and Experian ). following, if you haven ’ t already, be sure to open accounts in your business ’ second name, including a clientele bank account and a business call agate line. You ’ ll besides want to repay your business debts ( early if possible ) and remove veto marks from your commercial enterprise credit report .
How To Get Approved For A Corporate Business Credit Card
With all that said, it ’ randomness worth noting that a business ’ credit score international relations and security network ’ t the be-all-end-all when it comes to getting a corporate wag. Brex, for case, considers a business ’ cash flow and spending patterns ( deoxyadenosine monophosphate well as its credit history ) during the approval process .
4) Know About The Types Of Corporate Cards Available
A trickier aspect of corporate cards can be the assorted ways issuers structure corporate card liability. Let ’ s fault it down :
- Corporate Liability: The company is solely responsible for all debts incurred. The company receives the bill directly from the card issuer. The issuer will not check your employees’ credit.
- Individual Liability: The employee using the corporate card is responsible for the debt incurred on the employee’s corporate card. The employee must pay the bill and then request reimbursement from the company. This arrangement requires that the issuer run a “soft pull” of the employee’s credit so that the employee’s credit score won’t take a hit.
- Joint Liability: Both the company and the employee are responsible for the debt. Under this arrangement, an employee’s personal credit will be unaffected if their corporate card is paid in full within a set number of days. However, if a payment is missed or late, the issuer reports the delinquency to the credit bureaus, and the employee’s personal credit score takes a hit.
clearly, individual and roast liability programs pass more of the credit gamble on to the employee, while corporate liability insulates employees from this type of hazard. You ’ ll besides want to note that in some cases you may be able to choose which type of indebtedness your corporate card program follows .
5) Decide What Features You Want For Your Corporate Credit Card
With traditional issuers, corporate credit cards are not offered as a packaged deal ( compare that to the rigid, unnegotiable perk up of personal or humble business credit cards ). The sort of business that is eligible for a corporate accredit batting order likely has unique and specific needs, and can typically cut a deal with a corporate calling card issuer that is specific to those needs. Two businesses could therefore use the same bodied citation menu but have wholly unlike terms .
At modern fintech companies ( such as Brex or Ramp ), however, corporate menu products are generally less flexible. These newer card issuers offer a specific jell of honor schemes, tools, and early features for their bodied cards. This doesn ’ triiodothyronine mean these cards aren ’ metric ton slightly elastic ; you ’ ll placid be able to customize employee spending rules, for example .
Corporate Card Reward Programs
Most bodied cards come with rewards programs precisely like traditional credit cards. Choosing a card with the proper rewards broadcast could save your company money any time an employee uses their card to make a purchase — potentially making rewards a winder separate of the decision serve. Because of the varying align of features and rewards packages out there, we believe it ’ sulfur best to shop around and exercise with an issuer to determine the bodied card elements that best courtship your party .
“ Companies should use corporate cards so the credit menu perks go to the company rather than the individual cardholder, ” said John Li, co-founder of Fig Loans. “ Those rewards can help businesses, particularly small businesses with tight budgets, vastly. ”
6) Find An Issuer To Work With
bodied recognition cards have been traditionally issued by large banking institutions — longtime bigwigs American Express, J.P. Morgan, and Capital One all offer a kind of corporate cards. In general, bank institutions provide a count of different corporate batting order product lines to suit an range of companies. These institutions have besides been about for a while, which could provide a solid level of security .
That said, there is a new crew on the fit : fintech startups. The shed of newcomers includes Brex, Divvy, and Ramp. Credit card processing company Stripe besides offers its own bodied tease. Fintechs provide full-bodied software suites meant to help manage a party ’ second outgo. They can besides be more agile in times of crisis. Brex, for example, tweaked its rewards schema to better courtship transitional at-home workforces during COVID, while Divvy worked impressively to help get customers PPP loans .
“ Large accredit card companies have been feeling the atmospheric pressure from these fintech companies, and have been forced to develop alike services and features to try and compete, ” Panteli said. “ Divvy, Ramp, and Brex offer everything you could always need from a corporate credit menu, including great rewards, low fees, and a modern environment. ”
How To Apply For A Corporate Business Credit Card
After you ’ ve shopped around and picked the best fit for your company, note that the application march for corporate cards varies from issuer to issuer. Generally, though, most will require that you submit an inquiry ( whether by phone, in person, or on-line ) before officially entering the process. This is a bit different from standard credit rating cards, which you can often apply for on-line .
Corporate Credit Card Requirements
additionally, we ’ ve found that many issuers will want you to commit to a minimum number of cards and annual spending, indeed name sure you know what they expect from you .
7) Create Guidelines For Employee Use
We ’ ve found that one of the chief reasons businesses use corporate credit cards is to streamline employees ’ work-related outgo. This will require you to issue guidelines for how employees use the corporate tease score, as corporate credit cards allow you to monitor and control employee outgo .
“ Building a spending policy with your team up front is key, as is meeting the policies to ensure that employees amply understand your expectations on outgo and report, ” said David Aylor, a South Carolina-based lawyer who uses corporate cards for his business. “ The exploit international relations and security network ’ thyroxine done there — spending policies should be revisited and reviewed semi-annually or annually and adjusted as needed to your changing business structures. ”
You can place controls on the types of expenses and merchants for which employees can use the card, and you can limit how much your employees can spend, either overall or on a per-transaction footing. Employees broadly pay the card issuer directly for any unapproved charges .
Be sure that the guidelines you establish for your employees make sense given the nature of your industry and the expenses your employees are likely to incur during their duties .
FAQs About How To Get A Corporate Credit Card
How do you qualify for a corporate circuit board ? The requirements for getting a bodied credit card deviate depending on the menu issuer. Most issuers ( though not Divvy ) require that your clientele be an S-corp, C-corp, or LLC. Most issuers besides have some combination of requirements regarding your annual gross, cash in the bank, annual accredit card spending, time in business, and the number of wag users within your business. One thing they don ’ thymine command, however, is a personal guarantee .
Who gets a corporate recognition batting order ? bodied credit cards are used by the owners and employees of qualifying businesses for spending on empower business expenses .
What credit sexual conquest is needed for a corporate credit wag ? bodied credit cards do not check applicants ’ personal credit rating scores and have no personal credit score requirements. however, some bodied card issuers do consider a company ’ mho business accredit score during the application process, but they rarely post a particular minimum business accredit mark. other corporate batting order issuers don ’ t take a company ’ s commercial enterprise credit score into consideration at all .
How do I apply for corporate credit ? Applying for a bodied citation card can be initiated by visiting a corporate menu issuer ’ s web site. You ’ ll need to provide documentation verifying your business ’ sulfur appoint, type, and size. You ’ ll besides need to provide software documentation of your caller ’ second fiscal health .
What ‘s the deviation between corporate cards and business accredit cards ? The chief deviation between corporate credit cards and business credit cards is that with bodied cards, the business owner is not held apt for any debt incurred, as there is no personal guarantee requirement. That ’ s not the case with business recognition cards. Corporate cards besides tend to have more rigorous requirements regarding your annual tax income, come of cash in the bank, and expected annual spending .
Where can I find out how to get a business credit card ? Merchant Maverick ’ s steer to getting a clientele credit rating card is a great resource for clientele owners who think a business credit card may benefit their company. As for how to get specific business credit cards, a occupation credit card issuer ’ south web site will contain information regarding how to qualify and apply.
Find The Right Corporate Credit Card For Your Business
corporate credit cards are an elite product for big, static businesses with numerous employees. Expect more involved processes to apply, implement, and use a bodied poster than you ’ five hundred find with a personal or small business credit batting order. however, some energetic fintech companies are shaking up the view and making it easier than ever to snag a corporate citation card. Learn more about these newcomers in our Brex, Divvy, and Ramp reviews .
Think your clientele is a good equip for a corporate credit card ? Take a look at Merchant Maverick ’ s darling corporate cards. You can besides learn the best tips for managing a corporate card .
Aren ’ t quite fix for a corporate credit menu ? Consider a small occupation recognition tease or even a personal credit card alternatively .