How to get a credit card for a new business

8 Oct 2020

Business credit cards are available for organisations of any shape or size—including new companies. If you’re a sole trader, run a small business or have recently set up a new one, you might be eligible for a business credit card.

man holding a selection of credit cards

Before we run through some of the business credit cards on offer, let’s establish a few of the facts and benefits associated with this type of business finance. 

A business credit card—which is sometimes referred to as a company credit card—is a credit card used by a company as opposed to an individual for their personal expenses. Business credit cards provide businesses with quick and convenient access to a line of credit up to a set limit, e.g. £10,000.

New businesses can use their credit card to buy business items, build a credit profile, manage employee expenses or a combination of the three. 

New business credit card benefits

  • Enables you to separate your business’ finances from your personal finances

  • Provides easy access to cash that you can pay back once you’ve received funds

  • Are widely accepted

  • Saves you time on admin when it comes to handling employee expenses

  • Many come with rewards and some with free insurance options

If you run a startup, you’ll probably want a credit card that can help you maintain healthy cash flow. You’ll also want it to have a low interest rate in case you can’t pay the balance, as well as one that offers rewards when you spend. 

business credit card

New business credit card checklist

  • Annual fee

     - some credit cards offer incentives such as no annual fee for the first year. Credit card annual fees vary, so make sure you factor this in when budgeting.

  • Interest rates on purchases

     - even if you plan to pay your business credit card bill in full every month you should still consider this—after all, anything can happen.

  • Access

     - check whether you’ll be able to manage your account from your smartphone and how functional the app is. Will it integrate with your accounting software?

  • Rewards

     - You can opt for a business credit card that provides a percentage of what you spend back as cashback, air miles or other rewards such as vouchers. (Some offer insurance, e.g. free travel insurance.)

  • Transaction fees abroad

     - if you travel a lot for business and plan to use your credit card abroad regularly, you should consider a credit card with no foreign transaction fees.

  • Cards

     - When you sign up for a business credit card, some lenders give you a limited number of cards for free, whereas others charge for additional cards. 

New business credit card examples

Capital on Tap 

Capital on Tap currently offers two credit cards—the Business Credit Card (free) and the Business Rewards Credit Card (£99 per year). Depending on your circumstances, you could get a credit facility of up to £50,000 for your business. 

CoT Yellow

Interest rates start from 9.9% APR (39.9% representative APR).

Both options offer up to 56 days interest free on card purchases and there are no FX or UK ATM charges for either cards. The Business Credit Card provides up to 10 free supplementary cards. 

CoT Blue

The rewards card provides up to 20 free supplementary cards, plus the following rewards:

  • Earn 1 point for every £1 of card spend

  • Redeem 1 point for 1p (1% cashback) or 1 Avios (Avios is the reward currency of the British Airways Executive Club)

  • 10,000 bonus points that you can redeem for £100 cashback or 10,000 Avios** when you spend £5,000 on your card in your first 3 months

 Capital on Tap’s business credit cards integrate with Apple Pay and Google Pay, allowing you to make easy and secure payments via smartphone. You can use the Funding Options platform to enquire about a card from Capital on Tap. 

Royal Bank of Scotland

  • 16.9% p.a. variable 

  • £0 fee in the first year, £30 following year one

  • 24.3% APR

Yorkshire Bank Business Card

  • 16.9% p.a. variable 

  • £0 in the first year, £28 following year one

  • 22.4% APR

Metro Bank Business Credit Card

  • 13.97% p.a. variable 

  • £0 annual fee

  • 14.9% APR 

British Airways American Express® Accelerating Business Card

  • 22.2% p.a. variable

  • £210

  • 80.3% APR

HSBC Commercial Card

  • 15.9% p.a. Variable

  • £0 in the first year, £32 following year one

  • 22% APR

Clydesdale Bank Business Card

  • 16.9% p.a. Variable

  • £0 in the first year, £28 following year one

  • 22.4% APR

Lloyds Bank Business Credit Card Ex/C

  • 16.3% p.a. Variable

  • £32 per year

  • 22.4% APR

You should keep in mind that the credit card provider will carry out checks before offering you a facility. New businesses without a substantial credit history may find it harder to be approved; interest rates may be higher and credit limits lower. 

The credit lender will check your business’ credit record and finances when you apply, and if you’re registered as a sole trader they may check your personal finances and credit record. You don’t necessarily need a business account to get a business credit card, however it can simplify processes when it comes to paying bills and handling finances.

Often, businesses with good credit ratings will get access to the best business credit card deals. However, you may still be able to get a credit card even if your business credit history isn’t perfect. In fact, having a business credit card is one of the many ways you can improve your credit profile, as long as you use it responsibly.

Remember: credit cards are just one business finance option. There are lots of others out there that may be more accessible or appropriate for your needs, including asset finance, business loans, invoice finance, revolving credit facilities and more.

Get started

Joe Morley
Joe Morley

Head of Unsecured Lending

Joe has worked in the alternative lending space since 2015. During this time he has helped hundreds of SMEs access millions in essential funding ranging from long-term asset-backed lending to short-term unsecured revolving credit lines and beyond. In his role, Joe manages and supports a large team of Credit Finance specialists.

Subscribe to our newsletter today

Sign up for the best of Funding Options sent straight to your inbox.