Credit Card Articles

Credit For Small Business Owners

June 21, 2012 by CreditCardsCo™

When it comes to running a small business, there are a number of little every day expenses which can quickly mount up. Having a credit card can help manage these expenses and build your business' credit history for larger future purchases.

Getting credit for your business can be extremely important, especially for small businesses who do not have a large amount of cash on hand for covering expenses. However, it can prove difficult for small businesses to gain approval for credit cards. If your small business is turned down for a credit card, there are various things that you can do to ensure that you get credit in the future.

There are various ways to improve your small business' chance of qualifying for a credit card which can then be used for those day to day business expenses such as travel costs, corporate lunches and office supplies. If your business is still fairly new it probably does not have an established credit history. This means that lenders will look at the business owner's personal credit score instead. If your company is not very well established yet, you should check with at least one credit bureau and ensure that your personal credit history is accurate. If you do happen to spot any discrepancies, be sure to have them fixed or updated as quickly as possible.

While thinking about your personal credit history, it is important to remember that a missed car loan payment or a default on your credit card payment history is a sure way to be very quickly turned down for a business loan or business credit card. It is important to make sure that all personal loans and borrowings are paid on time. This includes payments to utility bills. While utilities payments do not make any improvement on your credit score, missing a payment will be reported to the credit bureaus and as a result, your credit score can be negatively impacted.

The best way to build the credit history of a small business is by establishing a history of regular payments. The best way of achieving this is to ask for a small line of credit first. That way you will be able to establish good credit fairly quickly by making regular payments and paying the debt off by the end of the year. As your business' credit score begins to steadily improve, you, as the business owner, will find that you have much greater bargaining power when it comes to approaching lenders for additional credit.

However, it is also important never to ask for more credit than you would get with a personal credit card. It is much smarter to start off small and ask for a low credit limit. Once you have proven to the lender that the business has the capability of paying off the monthly balance in full, the will be more than happy to extend your line of credit accordingly. This will lay the groundwork for any large purchases required as your business begins to grow.

If you apply for a business credit card and you are turned down by the lender, do not be afraid to ask why they came to that decision. It may be that the lender is willing to offer an alternative credit account. For example, small home based businesses are probably not going to be approved for a premium platinum card, but a credit card issuer may be perfectly happy to offer a standard version of the credit card. If you do happen to get a rejection from one credit card provider, do not give up.

Continue to work on building a credit history for your small business. Keep asking questions and applying for credit while keeping all of your personal accounts in order. If you continue to persevere it will pay off in the end and your business will eventually be approved for a credit card. Once that happens your small business is well on the way to gaining an excellent credit score.


In closing, the key to establishing a favorable credit history for your small business is perseverance. While you may not be accepted for credit immediately, there are ways to improve your business' chances of obtaining credit so that you may secure a credit card in the future.

Other Readings

Credit Card FAQ

The " Credit For Small Business Owners" article is property of CreditCardsCo™ and is copyrighted. The article may not be published, rewritten, broadcast or redistributed without prior written permission.

Home | Terms | Privacy Policy | Sitemap | Contacts Copyright © 2022 - CreditCardsCo™ - All rights reserved.
CreditCardsCo Disclaimer