Living with credit

How to apply for a business credit card

John Egan
How to apply for a business credit card

Austin, Texas, entrepreneur Tito Beveridge built his estimated $2.5 billion vodka empire by maxing out 19 credit cards to borrow tens of thousands of dollars.

It’s unclear whether Beveridge’s 19 credit cards were personal cards, business cards or a mix of the two. (Tito’s PR team declined a request for an interview.) But if he’s like most entrepreneurs – including me – at least one of his cards was a business credit card.

And I’d bet he has at least one business credit card is in his wallet now, since he recently was named one of the richest people in the United States.

I also bet that he long ago paid off those 19 maxed-out credit cards.

I don’t have much in common with Beveridge, as far as I know, except that we both live in Austin and both drink vodka – and that we both likely have filled out an application for a business credit card.

Last year, I applied for an American Express SimplyCash Plus business credit card and was approved. (See my earlier post, “Business credit card makes me feel like a grown-up.”) Today, I put business-related purchases on this card to help track expenses and to earn cash back.

Applying for a business card: similarities, differences

The application process for the SimplyPlus card was simple – and similar to the process for getting a personal credit card. But, as you’d expect, there are some differences.

Gerri Detweiler, education director at Nav, a startup that helps small businesses build and manage credit, says that if you’re seeking a business credit card, you’ll need to supply this information:

  • Name of business
  • Legal structure (such as LLC or sole proprietorship)
  • Launch date
  • Number of employees
  • Business revenue

“These questions may make entrepreneurs think they have to have a successful or well-established business in order to get one of these cards, but that’s not always the case,” Detweiler says. “We’ve seen business owners who have just launched and are pre-revenue get approved.”

I can vouch for that. I had launched my freelance writing business just a few months before being approved for the SimplyCash Plus card.

Also, a business owner’s personal credit report might be checked when he or she is seeking a business credit card. Under the federal Fair Credit Reporting Act, a credit card issuer is allowed to do this, but only for businesses that are organized as sole proprietorships, according to Experian, one of the three credit-reporting bureaus.

“Many small businesses have little or no credit history on which to base a decision. Personal credit is used as a ‘reference’ for entrepreneurs,” Experian says.

Pluses and minuses of business credit cards

In 2017, my CreditCards.com colleague Tamara S. Holmes wrote a great article, “6 reasons entrepreneurs should get a business credit card.” One of the points made in the story is that business expenses and personal expenses shouldn’t be mixed.

I wholeheartedly agree with that. For one thing, that makes it much easier to do your taxes.

But she also notes that an entrepreneur normally is required to personally guarantee the debt on a business credit card – meaning that if something goes awry, the business’s and entrepreneur’s credit records could take a hit.

While the thought of being on the hook for business debt is scary, the application process for a business credit card is not. So, don’t let the application process – or the notion of being rejected for a business credit card – prevent you from exploring the idea.

At the same time, you should banish any belief that your small business isn’t worthy of a business credit card, no matter how small the business is.

“A common myth is that only large companies need business credit cards, but benefits like expanded buying power, spending rewards and tracking assistance can help fuel business growth regardless of size or industry,” Audrey Henley, senior vice president of American Express OPEN, told Holmes.

Who knows: With just one business credit card to help get your venture off the ground, you could become the next Tito Beveridge. If you do, someone out there should toast you with a shot of Tito’s Handmade Vodka (or whatever your favorite beverage is).

See related: Business credit card reviews, Our 3 best business credit cards, How many business credit cards should you have?How card rewards can cover business trip costs

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