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Business credit cards

What are business credit cards?

Business credit cards – also known as a company credit cards – are held by a business rather than an individual.

That means they don't affect your personal credit score, and are offered by banks based solely on the company's performance.

They can be used to manage the expenses of your employees alongside regular business spending. You can also use one to improve your organisation’s credit profile.

Any business – regardless of its size – can use a company credit card.

Why get a business credit card?

Business credit cards offer several advantages that make them attractive, including the following benefits:

• Keeps company transactions separate from personal ones

• No need to wait for funds to arrive before your business can spend

• Helps speed up the process of administering your employee expenses

• Gives you extra peace of mind when spending – whether in the UK or overseas

If any or all of these features could potentially help your business, then a company credit card would well be worth applying for.

Company credit cards come in many different types, each with its own conditions, such as those restricted to businesses whose turnover doesn’t exceed or fall below a specific amount. Another example requires businesses to show two years of accounts.

The size and financial strength of your business could determine what kind of card and deal you get.

Find out more about business credit cards

Are business charge cards similar to business credit cards?

Business charge cards and credit cards work slightly differently. For a start, charge cards don't let you borrow money over several months or spread the cost of purchases. You have to repay the entire balance owed in full each month. For this reason, charge cards are not advertised with credit limits or interest rates. 

However, in the event that a balance isn’t repaid in full, you will be charged a fee and this can often be higher than the interest you would pay on a credit card.

Business credit cards offer more flexibility and only ask for a fraction of the outstanding debt each month as a requirement - though you are free to pay more than that. If you don’t clear your balance in full, interest will usually be charged.

Who offers business charge cards?

The number of providers offering charge cards is fairly limited, though existing customers of mainstream banks may be given that facility. However, one of the largest and most well-known providers of business charge cards is American Express.

What perks do you get with business credit cards?

You’ll find each business credit card offers its own set of benefits. Things to look out for include:

• Cashback – a percentage of your spend is returned back to your card, effectively offering a discount on your purchases 

• Free insurance – such as travel or mobile phone insurance

• Discounts – save money in certain stores or on specific activities

• 0% interest deals – avoid interest on your purchases for a specific period, allowing you to pay off the entire amount without incurring any charges

• Rewards – common examples include points that can be traded in for vouchers, or Air Miles to cover the cost of air travel

Are there any alternatives to business credit cards?

Yes, although the best option depends on the reason you’re looking into business credit cards in the first place.

For example, if you simply need a means of paying for purchases with money you already possess, a business bank account could be a good alternative.

If you’re looking to borrow a large sum – say, to cover a large purchase – then a business loan might be a more appropriate choice.

Review all business-specific products

Further Information

• Business credit cards and paying your tax by gov.uk

• What to know when starting a business according to the Money Advice Service

• Opening a business current account from UK Finance

Last updated: June 7, 2023