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Do You Need a Business Credit Card?

by Ryan Guina

Do you need a business credit card?

Do You Need a Business Credit Card?If you are a small business owner, you have probably asked yourself this question. And the answer obviously depends on your line of work and the nature of your business. For me, the answer is yes.

Sure, I know some of you are saying, “does anyone really need a credit card?” Well, yeah, some people do. Especially small business owners. There are many situations where you need a credit card to make purchases (especially online), secure travel or rental cars, and more. Not every business owner needs a credit card, but many do.

Why I use a business credit card

I run several websites and most of the business I do revolves around online transactions. I usually only have a few payment options for online transactions: Credit card (accepted almost everywhere), debit card (accepted almost everywhere), business check/ACH (not accepted everywhere), and PayPal (not accepted everywhere).

Why credit cards trump other payments options. Credit cards offer better buyer protections, especially when it comes to fraud or payment disputes. credit cards also offer better cash back and rewards programs than debit cards and most business cards offer additional cash back or rewards in categories businesses are most likely to use, including gas, office supply stores, or other categories. So while I could use my debit card that is linked to my small business savings account (I use Capital One 360 Business Savings), I choose to use a business rewards credit card instead. The extra cash back is nice and I pay the card in full each month.

Did you know anyone can apply for a business credit card? You don’t need a small business to apply for a business credit card – anyone can apply for a business credit card by using their SSN when they apply. Why would you want to? Because business credit cards often offer different rewards programs or higher limits than some traditional rewards credit cards.

Benefits of business credit cards

There are several benefits to using a business credit card, some of which are extremely important, and some of which fall into the “nice to have, but not 100% necessary” category. But if you plan on using a business credit card anyway, then the “nice to haves” are really nice to have!

  • Separation of business and personal finances. Probably the most important benefit is being able to easily separate your personal and business finances. This is very important to me as I separate my personal and business finances. (More about how I manage my small business finances). I only make business purchases with my business credit card, PayPal, or with business checks. If I use my business credit card (which I use as often as possible), I pay it in full each month.
  • Higher limits. Many business credit cards offer higher limits than personal credit cards. This is important for startups or businesses that have large monthly expenses. Not all vendors accept money transfers, PayPal or other payment methods, and sometimes that extra float each month is necessary to keep operations running smoothly.
  • Higher rewards for business expenses. Most business credit cards offer higher cash or points rewards for common business expenses such as office supplies, gas, restaurants, travel, and sometimes rotating categories. If you are planning on using a business credit card anyway, you may as well use a rewards credit card!
  • Automatic payments. It’s easy to set up automatic payments to your business credit card, which is nice for recurring bills. Some, but not all companies will do this for checking accounts, but again, I’m all about the cash rewards, and recurring payments are a nice way to do that!
  • Flexibility. Obviously the best way to manage your credit card bill is to pay it in full each month, but things don’t always work out that way, especially when working for a startup or in the beginning stages of many small businesses.

Featured business credit card:

One of the best business cards currently on the market is the Starwood Preferred Guest® Business Credit Card from American Express, one of the best business cards offered by American Express. This card offers excellent rewards for you or your business, with the ability to earn additional Starpoints® based on spending habits. Check out more details:

  • Starpoints® bonus: Earn up to 25,000 bonus points
  • Earn 10,000 Starpoints® after your first purchase on the Card and another 15,000 after you spend $5,000 in purchases on the Card within the first 6 months of Cardmembership
  • Starpoints® redeemable towards Free Hotel Nights at over 1,100 hotels in nearly 100 countries worldwide – with no blackout dates
  • Earn 2 Starpoints® for each dollar of eligible purchases charged directly with hotels and resorts participating in the SPG® program
  • Earn 1 Starpoint® for each dollar of eligible purchases
  • 0 introductory annual fee for the first year, then $65
  • Terms and limitations apply
  • Apply Now!

Do you have a preferred business credit card?

Disclaimer: This content is not provided or commissioned by American Express. Opinions expressed here are authors alone, not those of American Express, and have not been reviewed, approved or otherwise endorsed by American Express. This site may be compensated through American Express Affiliate Program.


Published or updated January 1, 2014.
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