Choosing a business card for your new business

As you’re starting out on your business journey, you likely have a significant amount of preparations and decisions to make before you’re up and running. Among those decisions may be which type of credit card would work best for your business.

A business card can be an essential tool for your new venture, as it may help you manage finances and, when used responsibly, build credit. Keep reading to learn what you need to consider when choosing a business credit card for your startup.

What you’ll learn:

• When you’re comparing business cards, it may be helpful to consider your spending needs and research potential card benefits.
• You can get pre-approved for a business credit card to better understand which cards you may be eligible for.
• Limited liability companies (LLCs) and nontraditional businesses may also qualify for business credit cards—as long as they meet requirements set by the card issuer.
• Capital One offers a variety of business credit cards to help you get business done.

Here are some factors to consider as you shop for a business card for your new business:

There are various types of business credit cards available, and they all can serve different needs and purposes. Take a closer look at some popular business credit card categories:

• Charge cards: This type of card must be paid in full each month. Charge cards can be beneficial if you need a flexible spending capacity because they typically have no preset spending limit. The Capital One Venture X Business and Spark Cash Plus cards are examples of business charge cards that offer best-in-class rewards.
• Cash back cards: If you’re looking to get rewarded for your business spending, you might opt for a cash back business credit card. Business cash back cards—like the Capital One Spark Cash and Spark Cash Select cards—typically return in the form of cash rewards a percentage of the qualifying purchases you make. Cash back can be redeemed as a statement credit, as a check or transferred directly to your bank account.
• Travel rewards cards: With a business travel card, you typically earn rewards in the form of points or miles on everyday purchases. You can redeem your earned rewards toward travel expenses. The Capital One Spark Miles and Spark Miles Select cards are examples of business travel cards.

Note that these card types are not mutually exclusive. For example, your business credit card may give you the option to earn cash back and travel rewards.

Before you decide on a business credit card, think about what your business’s spending habits are. For example, do you need a large spending capacity to fund things like supplies, vendor payments and operational expenses? If so, a business charge card might be a good option to consider. Charge cards also offer rewards that, coupled with often-larger spending capacity, allow them to maximize their rewards potential.

Perhaps you’re looking to earn great travel rewards so you can get credits toward future travel. In that case, you might choose a business travel rewards credit card that lets you earn unlimited miles on every purchase.

Some business credit cards have annual fees, which may or may not be worth it depending on the potential card’s benefits and your business’s needs. Before you apply for a business credit card that has an annual fee, review the card’s travel rewards, bonus offers and additional features to determine if the benefits offset the fee.

In addition to travel rewards and cash back, some business credit cards may offer other features that could benefit your new business, like:

• Welcome offers
• Anniversary bonuses
• Travel credits to be used toward certain travel purchases
• Global Entry or TSA PreCheck® credits
• Free employee cards
• Access to airport lounges
• Virtual cards
• No foreign transaction fees

Once you’ve narrowed down your card options, it can be helpful to review certain terms so you understand how using the credit card could impact your business’s finances. Some details to look more closely into include:

• What the potential annual percentage rate (APR) is
• If there’s a maximum credit limit
• How rewards are earned and redeemed
• What the late fee is and if there are penalty APRs
• How welcome bonuses are earned
• The suggested credit level 
• Payment terms

As you compare and contrast various business credit card options for your new business, you might consider getting pre-approved. Pre-approval for a business credit card means the issuer has done a basic review of your profile and determined you meet certain requirements to get a credit card. Although it’s not guaranteed you’ll get approved, pre-approval can give you a better idea of which card options you’re eligible for.

For example, the Capital One pre-approval tool lets you see which business cards you’re eligible for so you can decide which would best meet your company’s needs. It’s quick and easy to use—and it won’t impact your personal credit score.

Here are some frequently asked questions about business credit cards for new businesses:

When you’re choosing a credit card for your new business, you may be overwhelmed with the number of options available. You can narrow down your choices by considering your business needs, researching the various types of business credit cards and getting pre-approved.

Compare Capital One business credit cards today to help move your new business forward.