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Published: Oct 10, 2023 4 min read

Small business credit cards are a lot like the cards that are already in your wallet. You apply for them using your personal credit history, and pay back the charges you make; typically with added interest.

Still, there are advantages to having a designated credit card for business expenses. Separating your personal charges from your business spending makes for easier bookkeeping and tax prep. Some credit cards also come with perks tailored to the needs of small business owners — like rewards points that offset the cost of desk supplies and shipping charges.

If you’re a business owner, freelancer or sole proprietor, here’s what to look for in a small business credit card.

Business vs personal credit cards

Small business credit cards work much the same as the ones you use for personal expenses. Which means that, in most cases, you’ll be responsible for paying back every charge you make, even if your business is no longer operating.

The differences lie in how you use the card, and the perks that come with it. For many business owners, whether they’re self-employed or in charge of a full staff, a small business line of credit is a simple way to finance short-term business spending. Others seek out cards that come with special tools for expense and cash flow reporting, travel rewards incentives or rewards points for things like office supplies, advertising and shipping.

Take some time to research all your options, and find a card that aligns with your business needs and priorities. Money’s guide to the Best Business Credit Cards is a great place to start.

Benefits of small business credit cards

Simplify expense management

A small business credit card provides an efficient, secure way to track and control business-related spending. You can customize spending limits, generate detailed expense reports and integrate your credit card accounts with accounting software. Used correctly, small business credit cards enhance transparency and accountability, and make it easier to manage your finances.

Reward business spending

Many business credit cards offer cashback incentives for certain types of spending, which can offset the cost of business travel, office supplies and shipping charges. These rewards can help you save money on qualified purchases and add value to your business.

Protect your purchases and travel plans

Purchase security is another big perk of business cards. Most come with theft and damage protection of newly-purchased items bought with the cards, and some provide return protection as well.

Some business credit cards also offer travel insurance to card holders, including rental car insurance and trip cancellation/interruption insurance.

Access tools for account management

Some credit card providers offer expense management tools that automatically categorize transactions and generate expense reports, which can save you time on (or completely eliminate) data entry tasks.

Small business credit card FAQs

Do I need a small business to get a small business credit card?

Application requirements vary by lender, but you generally don't need an LLC to qualify for a small business credit card. Many credit card issuers allow freelancers, gig workers and sole proprietors of all stripes to apply.

How hard is it to get approved for a small business credit card?

Most lenders will look at a range of criteria related to your personal creditworthiness and the financial health of your business before approving you for a new line of credit. This typically includes your credit score and history, business revenue and recent expenses.

How do I apply for a small business credit card?

Many companies allow you to apply quickly and easily online. Some require documentation of your monthly expenses and annual revenue, as well as information about your business plan and structure. Be sure to prepare accordingly.

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