Corporate credit cards: a full guide

Corporate credit cards are a popular type of working capital finance. In fact, corporate and virtual cards are the third-most popular working capital solution among top-performing companies globally.

Unlike business credit cards, which are typically aimed at small businesses and linked to personal credit, corporate credit cards are designed for larger, established businesses – offering higher limits, employee spending controls, and advanced expense management tools.

Not all corporate credit cards are created equal. Some offer cashback, others provide spending controls for your team, and a few even help build your business credit score.

If you’re considering getting a corporate credit card, the most important thing is to find one that fits your specific needs. For example, do you want to streamline expense tracking for your team or maximise rewards on everyday business spending?

In this article, we’ll explain what a corporate credit card is, how it works, who it's for, the pros and cons, and how to choose the right one for your business.

Key points:

• Corporate credit cards allow established businesses to manage expenses, improve cash flow, and issue cards to employees

• They’re less suitable for smaller businesses or sole traders, who may find a business credit card more accessible

• Funding Options by Tide can help when optimisation of working capital isn’t enough, offering access to business finance up to £20 million

What is a corporate credit card?

A corporate credit card is a credit card issued to your business (rather than to you personally).

They allow you to issue cards to multiple employees, set individual spending limits, and manage company expenses such as office supplies, dining, and travel costs – while keeping your business spending separate from your personal finances.

Unlike a personal credit card, a corporate card is tied to your business’s credit profile. So ‌spending limits are usually higher, and you can typically issue multiple cards to your employees. Many corporate credit cards also include tools to track expenses in real time, so you’re never left guessing where your money went.

Corporate credit cards can help build up your business credit score, too. If you use the card responsibly (ie paying on time and keeping balances low) it can make it easier to access other types of financing down the line.

How do they differ from business credit cards?

At first glance, corporate credit cards and business credit cards might seem like the same thing. But they’re actually designed for different types of businesses.

A business credit card is usually aimed at sole traders, freelancers, or small business owners. It’s often linked to your personal credit profile, which means ‌spending limits are typically lower, and you might not get as many advanced features. These cards could be great if you’re just starting out or running a small business, and need a simple way to separate your personal and business expenses.

A corporate credit card is built for larger, more established businesses – particularly those with employees. Since it’s tied to your business credit profile, you’ll usually be offered higher spending limits. It will also likely provide the ability to issue multiple cards to your team and provide more sophisticated expense management tools (eg real-time spending tracking, custom limits for employees, and integrations with accounting software).

If you’re a one-person band or a small team, a business credit card might be all you need. But if you’re running a growing company with multiple employees, a corporate credit card could give you the control, flexibility, and rewards you’re looking for.

How does a corporate credit card work?

Corporate credit cards are very similar to personal credit cards, but there are some important differences.

Firstly, you’ll get a credit limit based on your business’s financial health (rather than yours). And because corporate cards are designed for established businesses with stronger credit profiles, that credit limit will likely be much higher than on a personal credit card – typically around £5,000 to £50,000 or more.

You can use the card for work-related purchases, such as office supplies, travel expenses, software subscriptions, or client entertainment. Then each month, you and/or your employer will receive a statement detailing your spending.

Similarly to a personal credit card, your business will need to make at least the minimum payment by the due date each month, but paying the full balance will avoid interest charges – some cards offer interest-free periods, which can be helpful when managing cash flow.

One of the biggest perks of corporate credit cards is the ability to issue a number of cards across your business. You can set individual spending limits per employee, controlling the appropriate levels for each department or employee seniority.

Most corporate credit cards integrate with accounting software like Xero or QuickBooks, making reconciling expenses quick and simple.

Who are corporate credit cards for?

Corporate credit cards are ideal for larger or more established businesses that need to manage expenses made by multiple employees.

If you’re a small business owner or sole trader, a business credit card might be a better fit. But if you’re a growing company with a team, a corporate card can help you simplify spending, improve cash flow, and potentially earn rewards.

A corporate credit card could be worth considering if:

• You want to split personal and business expenses: A corporate card keeps everything separate, so it’s easier to budget and manage your accounts

• You want to improve cash flow: With a revolving credit line, you can cover short-term costs even if cash is tight

• You want to allow many employees to spend freely: Employee cards with custom spending limits can keep everyone on budget

• You’re looking to build business credit: If used responsibly and you keep up with repayments, this could help strengthen your business’s credit profile

• You want rewards for spending: Some cards offer cashback, travel perks, or discounts on business services

Benefits of corporate credit cards

Corporate credit cards come with a range of benefits that can make running your business smoother and potentially cheaper.

Here’s what you could look forward to:

• Separate business and personal finances: No more sorting through personal bank statements to find business expenses

• Improved cash flow: Use the card to cover costs now and pay later, giving you breathing room when income is variable

• Expense tracking and reporting: Most cards integrate with accounting software, so you can see how the money’s spent

• Employee spending controls: You can set limits for team members and monitor their spending in real time

• Rewards and perks: Some cards enable you to earn cashback, travel points, or discounts on business spending

• Build business credit: Responsible use can help your business qualify for better financing options in the future

• Fraud protection: Many cards offer advanced security features to keep your business safe from unauthorised spending, such as real-time transaction alerts, virtual card numbers, and the ability to freeze or cancel cards quickly

And because corporate cards are widely accepted, you can use them for almost any business expense – from office supplies to client dinners.

Risks of corporate credit cards

While corporate credit cards offer plenty of advantages, they’re not without risks.

Here’s what to watch out for:

• High interest rates: If you don’t pay back the full balance each month (ie the amount spent), the interest can add up quickly

• Employee misuse: There’s the potential for employees to overspend or use the card for personal expenses, but having a clear policy can help solve this

• Impact on credit score: Late payments or high balances could hurt your business' credit score, making it harder to secure financing in the future

• Fees: Some cards charge annual fees, foreign transaction fees, or penalties for late payments

• Personal liability: If your business is new or has a limited credit history, you might need to sign a personal guarantee, which ultimately makes you responsible for any unpaid debts

Most of these risks can be managed with the right card and responsible use. Setting clear spending policies, monitoring statements regularly, and always paying on time can help reduce these risks.

Business credit vs. corporate credit

The main difference between business credit and corporate credit is the type of business they serve – small or large. But liability, eligibility, spending controls, and payment terms are other factors.

Business credit

• Typically issued to small businesses, startups, or sole traders

• The business owner is often personally liable for the debt, especially if they sign a personal guarantee

• Typically easier and quicker to qualify for, with less strict requirements

• Spending limits are usually set per card, and the business can carry a balance and spread payments over time

• Useful for building business credit history

• Expense management features are generally more basic compared to corporate cards

Corporate credit

• Designed for larger, more established companies with higher annual revenue and multiple cardholders

• The company itself is liable for charges (not the individual employees who hold the cards)

• There’s stricter eligibility criteria, which often require high revenues and a minimum number of cardholders, plus financial audits

• Offers advanced controls, like customisable employee spending limits and integration with accounting software

• Balances typically need repaying in full each month, with billing centralised for easier management

• Provides more sophisticated expense tracking and better visibility over company-wide spending

Corporate credit cards are a form of corporate credit since they’re designed for established companies and hold the company liable for any outstanding debt.

How to compare corporate credit cards

There are lots of corporate credit cards to choose from, and their features and benefits vary widely. So it’s important to compare options based on your business’s size and needs.

When comparing, look out for:

• Fees: Check for annual fees, foreign transaction fees, and late-payment penalties

• Interest rates: Look for low APRs and interest-free periods that could help reduce borrowing costs

• Rewards: If you’re looking to make the most of your spending, compare cashback, travel perks, or discounts on business expenses

• Spending limits: Make sure the card offers a limit that matches your business’s size and spending needs

• Expense management tools: If you want to track expenses closely, look for integrations with accounting software and tools like real-time spending alerts

• Employee cards: If you have a team, check how many additional cards you can issue and whether you can set individual spending limits

• Customer support: If something goes wrong, good and fast support can be extremely valuable

• Eligibility: Some cards require a minimum turnover or trading history, so check the eligibility criteria before you apply

Find business finance with Funding Options by Tide

Whether you’re looking for a standard business loan, a short-term business loan, or something a little more specialist, like auction finance for property developers, we’re one of the leading names in business finance in the UK, having helped facilitate over £1 billion in finance to more than 20,000 customers.

Checking if you’re eligible is free, only takes a few minutes, and while a full application would impact your personal or business credit score, checking eligibility won’t. Just submit your details via the link below to find out if you could be eligible to borrow up to £20 million.

Find business finance.

FAQs

What is the difference between a business credit card and a corporate credit card?

A business credit card is typically aimed at sole traders, freelancers, and small businesses. It’s often linked to your personal credit profile and offers lower spending limits. In contrast, a corporate credit card is designed for larger, more established businesses with multiple employees. It offers higher limits, advanced expense management tools, and (often) better rewards.

Can startups qualify for a corporate credit card?

Startups may qualify for a corporate credit card, but it’s often easier to start with a business credit card, especially if you’re a sole trader or a very small team. Corporate cards are usually aimed at larger, more established businesses with employees and a stronger credit profile. So if you’re just starting out, a business credit card might be a better fit – though some corporate card providers do offer options tailored to growing businesses.

How do corporate credit cards help with cash flow?

Corporate credit cards provide a revolving credit line, so you can cover short-term expenses even if cash is tight. This is particularly useful for businesses with variable income or seasonal cash flow. Business credit cards can also help with cash flow, but they typically have lower limits and fewer advanced features.

Are there corporate credit cards with no annual fees?

Some corporate credit cards don’t charge annual fees, but they might have higher interest rates or fewer rewards. Business credit cards are more likely to offer fee-free options. Always compare the total cost to find the most suitable deal for your needs.

How can I monitor employee spending with a corporate credit card?

Most corporate credit cards let you set individual spending limits for employees and send real-time alerts for things like unusual transactions, purchases over a set amount, or spending in specific categories. You can also integrate the card with expense management software to track spending more easily.

What rewards or perks do corporate credit cards offer?

Depending on the card, it may offer rewards like cashback, travel perks, discounts on business expenses, and access to airport lounges.

How do corporate credit cards compare to other financing options?

Corporate cards offer flexibility for short-term spending, like covering day-to-day expenses or managing gaps in cash flow. For larger, longer-term funding, options like business loans, working capital finance or overdrafts may be more suitable. Business credit cards serve a similar purpose but are better suited to smaller businesses or sole traders.

Please note that the information above is not intended to be financial advice. You should seek independent financial advice before making any decisions about your financial future.

It’s important to remember that all loans and credit agreements come with risks. These risks include non-payment and late-payment of the agreed repayment plan, which could affect your business credit score and impact your ability to find future funding. Always read the terms and conditions of every loan or credit agreement before you proceed. Contact us for support if you ever face difficulties making your repayments.

Funding Options, now part of Tide, helps UK firms access business finance, working directly with businesses and their trusted advisors. Funding Options are a credit broker and do not provide loans directly. All finance and quotes are subject to status and income. Applicants must be aged 18 and over and terms and conditions apply. Guarantees and Indemnities may be required. Funding Options can introduce applicants to a number of providers based on the applicants' circumstances and creditworthiness. Funding Options will receive a commission or finder’s fee for effecting such finance introductions.