Whether you’ve just started your new venture or in a business for a short while, sooner or later you’ll need to apply for a business credit card. Getting a business credit card for startups has numerous benefits, from financing purchases to simplifying cash flow, streamlining employee expenses, earning rewards, accessing accounting management tools, and more.
Today, there are a variety of business credit cards that you could choose from, and each card offers its own unique features that you could use to your business’ advantage. But getting a business card for your startup is not as easy as it seems.
Lenders consider various important factors when approving a credit card for your business. Here’s how you can increase your chances of getting the first business credit card for your startup.
Check Your Personal Credit Score
When your business is new and you don’t have any business credit history, lenders usually see your personal credit score when approving your business credit card application. So, it’s imperative to run a credit check to make sure your credit score is good.
If it’s looking less than ideal then it will be great to postpone your credit card application and work to make your personal credit score better. To improve your credit score, you should pay your bills on time, pay off debt, keep balances low on credit cards, customize your credit limit, rectify any mistakes on your credit card, and more. An amazing credit score will not only increase the chances of being approved for a business credit card for startups but also lower interest rates.
Find and Compare Cards
Widening your research is another great way to get a business credit card that best fits your startup financing needs and budget. Your business is different so your business credit card needs. Just like a personal credit card, there are many options for business credit cards. Depending on your business, revenue, and spending stream, you can earn more offers and rewards.
You can directly go to a business credit card company or lender and ask them about different features, perks, and rewards of a particular card. Besides, you can use an online lending marketplace to find and compare a variety of business credit card offers from the nation’s top lenders. You can review different card options and choose one that best fits your startup’s current financial needs.
Once you’ve finalized the lender and business credit card for startups, the next step is to apply for that particular card. No matter what business credit card you’re applying for, you may have to apply with no business credit history and the current stream of business revenue as a new entrepreneur.
So, it’s vital to pay attention to the various requirements of the card before applying and contact your lenders if you have doubts or queries. Always be honest and true to your information that you’re going to fill in on your application. If you fill in any false or wrong information, your loan application may be rejected, which later negatively impacts your credit score.
Use Your Card Wisely
Last but not least – understand the dos and don’ts of using a business credit card. Using your credit card wisely is important to manage your money and take your business to the next level.
If you want to get more value from your business credit card, keep your credit utilization ratio low, make credit card bill payments on time, and pay more than the minimum amount. Besides, paying off high-interest credit cards first, carefully scrutinize the promotional offers, avoiding ATM withdrawal, and using it for only business expenses will also help you save money and better manage your startup finances.
Applying for a business credit card for startups is just like applying for a personal credit card. If you’re applying for a business credit card, keep these above things in mind before choosing one. Besides, do your proper research and compare a variety of offers when applying for your first business credit card so you can make the best decision possible.