Business charge cards work like business credit cards, but are required to be paid in full monthly. Business charge cards are best for business owners who charge all expenses to their cards and can afford to pay off their balance every month. They carry annual fees from $95 to $595 and have no APR.
American Express is the only major credit card issuer that offers business charge cards. We believe the American Express Business Platinum Card® is one of the best charge cards. This is because it offers maximum travel rewards (5x points) and unbeatable additional travel perks, such as airport lounge access and expedited airport security screening access. You can apply online in just a matter of minutes.
What Is a Charge Card?
Charge cards let you make purchases, earn ongoing rewards, and offer valuable perks, including insurance and fraud protection. They carry no annual percentage rate (APR) because they’re required to be paid off every billing period. They typically have no preset spending limits and are best for borrowers with personal credit scores of at least 670.
A business charge card is the same thing as a personal charge card but for business owners. It’s an excellent option for short-term cash flow management and employee spending. However, you can’t carry a balance. If you need to carry a balance, consider a small business credit card.
How a Business Charge Card Works
Most business charge cards are required to be paid off every month, but some allow longer repayment periods (60 days or more). Instead of having an approved credit limit, you’ll have no preset spending limit. You can spend as much as you need, as long as you pay your entire balance off every billing period.
Because there is no preset spending limit, it’s impossible to calculate your credit utilization ratio. Your charge card balance will still be reported to the main credit reporting bureaus each billing period, even if they don’t affect your credit score. Credit agencies will still evaluate other factors, including your payment history, which can help you build your business credit.
If you have a small business credit card and pay it off in full every month, it would be similar to using a business charge card. With all things considered, if you can’t afford to pay off your balance in full monthly, then a charge card is not best for you. Instead, a good card option would be a 0% APR business credit card.
When Business Charge Cards Are Beneficial
Business charge cards are designed for business owners with established companies and a steady cash flow. They are best for business owners who are well-qualified, can afford to pay off their balance in full every month, and want no preset spending limit. If you fall into these categories, a charge card can be an excellent way to finance your business purchases.
Business charge cards are beneficial for:
- Business owners who are well-qualified: Typically, charge cards require business owners to have good to excellent personal credit scores (of at least 670) for approval. This is because of the no preset spending limit. If your personal credit score is below 670, consider a fair credit business credit card.
- Business owners who can pay off their balance in full monthly: Unlike small business credit cards, charge cards are due in full every month. If you fail to meet this requirement, your account will be hit with a late fee of at least $38. There are some cards that let you pay over time with interest, like American Express business cards.
- Business owners who want no preset spending limit: Business charge cards typically have no preset spending limit because they’re due in full monthly. This is beneficial to business owners who are looking to make large purchases and know they can afford to pay off their balance in full monthly.
You may want to use a business charge card if you want the flexibility of being able to make large purchases with no preset spending limit. Additionally, it’s important to only open a charge card account if you know you can meet the monthly payment requirement. If you’re not sure if you can pay off your balance in full every month, a 0% APR business credit card is a better option.
Business Charge Cards Costs
Most business charge cards carry an annual fee between $95 and $595. Charge cards with higher annual fees generally come with more robust additional card features, such as travel protections and insurances. Additionally, charge cards don’t carry APRs because they’re required to be paid off in full monthly. If you miss a payment, you will be hit with a late fee of at least $38.
Common business charge cards costs are:
- Ongoing APR: None, because charge cards must be paid off in full monthly
- Annual fee: $95 to $500 or more, which is sometimes waived for the first year
- Late fee: $38 or more
Compared to small business credit cards, business charge cards typically carry higher annual fees. Business charge cards with higher annual fees usually offer better ongoing rewards and additional features. For example, the American Express Business Platinum Card® offers maximum travel rewards and premium card benefits, but carries a high annual fee.
Best Business Charge Cards
American Express is the only major credit card issuer that provides business charge cards. When deciding which charge card is best for you, it’s important to consider the overall rewards, additional card features, and if it offers payment flexibility. Most charge cards are required to be paid in full monthly. However, some American Express business credit cards offer programs that let you pay your balance over time with interest.
American Express Business Charge Cards at a Glance
|American Express Business Platinum Card®||Business owners who travel often and want premium travel perks|
|The Plum® Card||Business owners who want pay early discounts or payment flexibility|
|American Express Business Green Rewards Card||Business owners who want a travel rewards charge card|
The three best business charge cards are:
1. American Express Business Platinum Card®
The Business Platinum® Card from American Express
- Welcome Offer: Earn up to 100,000 Membership Rewards® points.
- Earn 50,000 Membership Rewards® points after you spend $10,000 and an extra 50,000 points after you spend an additional $15,000 all on qualifying purchases within your first 3 months of Card Membership.
- Get 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com.
- Get 50% more Membership Rewards® points. That's 1.5 points per dollar, on each eligible purchase of $5,000 or more. You can get up to 1 million additional points per year.
- 35% Airline Bonus: Use Membership Rewards® Pay with Points for all or part of a flight with your selected qualifying airline, and you can get 35% of the points back, up to 500,000 bonus points per calendar year.
- Enroll to get up to $200 in statement credits annually by getting up to $100 semi-annually for U.S. purchases with Dell. Terms apply.
- Get one year of Platinum Global Access from WeWork. With this membership, you can access 300+ premium, inspiring workspaces in 75+ cities. To get this exclusive offer, enroll between 2/15/2019 and 12/31/2019.
- Terms Apply
|INTRO APR||REGULAR APR||ANNUAL FEE||CREDIT NEEDED|
The American Express Business Platinum Card® is best for business owners who travel often and want access to premium travel perks. With this travel rewards card, you’ll benefit from upscale airport lounge access, reimbursement for expedited airport security screening access, and complimentary hotel membership benefits. These features can be worth thousands of dollars yearly.
Additionally, you can earn substantial introductory rewards and top ongoing point rewards for travel-related purchases through American Express. We believe this is one of the best charge cards offered by American Express, and you can learn about its true value in our in-depth Business Platinum Card® review.
2. The Plum® Card From American Express
The Plum Card® from American Express
- Paying early pays off: Get a 1.5% discount when you pay early, with no cap on what you can earn back.
- Take up to 60 days to pay with no interest, if you pay your minimum due.
- Use the power of the Plum Card to buy big for your business.
- No Foreign Transaction Fees.
- Introductory annual fee of $0 for the first year, then $250
- Terms & Restrictions Apply.
|INTRO APR||REGULAR APR||ANNUAL FEE||CREDIT NEEDED|
|N/A||N/A||$0 introductory annual fee your first year, then $250.||Good, Excellent|
The Plum® Card from American Express is best for business owners who want no preset spending limit and payment flexibility. You’ll have the opportunity to earn pay-early discounts or opt-in to free financing terms. If you don’t opt-in to the free financing terms, this charge card is required to be paid in full monthly.
Unlike other American Express charge cards that require you to be invited to pay over time with interest, this card allows you to opt-in on your own. Additionally, you’ll have access to several additional card perks, including roadside assistance, extended warranty protection, and purchase protection. You can learn about these features and this card’s offerings in our review of The Plum® Card.
3. American Express Business Green Rewards Card
Business Green Rewards Card from American Express
- Limited Time Offer: Earn 3X Membership Rewards® points on your combined eligible purchases on the Card, up to the first $50,000, at U.S. restaurants, on hotel stays booked directly with hotels, and on airfare purchased directly from airlines in the first 3 months of Card Membership. Offer Ends 11/6/2019.
- Earn double Membership Rewards® points for each dollar of eligible purchases made when you book on the American Express Travel website
- Earn one Membership Rewards® point for each dollar you spend on eligible purchases
- Choose rewards from over 500 leading brands in travel, gift cards, merchandise or entertainment
- $95 Annual Fee
- Terms & Limitations Apply
|INTRO APR||REGULAR APR||ANNUAL FEE||CREDIT NEEDED|
The American Express Business Green Rewards Card is best for business owners who want a charge card that offers travel rewards. It offers an invitation-only Pay Over Time program, which allows you to have more time to pay off your charges with interest. If you’re not enrolled, you must pay off the balance in full monthly.
With this card, you can issue an additional 99 employee cards at no additional cost. Most cards offer free employee cards, even if the primary card carries an annual fee. If you’re interested in this card for your business, our detailed Business Green Rewards Card review will give you the answers you need.
Pros & Cons of Business Charge Cards
Business charge cards can be an excellent method of financing if your business generates enough revenue to pay off your balance in full every month. You can earn rewards on your everyday purchases, have access to unbeatable card features, and avoid the risk of accruing interest charges. However, qualifying is more difficult and there are no introductory 0% APR periods.
Pros of Business Charge Cards
The pros of business charge cards are:
- Earn rewards on your business-related purchases: Similar to business credit cards, some charge cards offer rewards for your everyday business-related expenses. These rewards can serve as a “discount,” allowing you to save money on your purchases.
- Offers robust additional card features: American Express business charge cards offer some of the best additional card features, such as extended warranty, purchase and return protection, and several travel insurances. These features are worth thousands of dollars every year and can increase the card’s value.
- No risk of accruing interest charges: Charge cards don’t carry any interest because you must repay your full balance every month. Those who can meet this requirement will benefit from never accruing interest charges.
Cons of Business Charge Cards
The cons of business charge cards are:
- Qualifying is more difficult: Since charge cards generally have no preset spending limit, the qualification requirements are more difficult. For example, most credit card issuers require business owners to have good to excellent personal credit scores (of at least 670) to qualify. If your score is lower, consider a fair credit business credit card.
- Required to be paid off in full monthly: The major difference between a business charge card and business credit card is the repayment schedule. Business charge cards must be paid off every month in full and carry no APRs. Business credit cards, on the other hand, only require a monthly minimum payment.
- No introductory financing periods: Charge cards don’t offer any introductory 0% APR periods on balance transfers or to help finance large purchases. If you are looking for special financing periods, consider a no-interest business credit card.
Business charge cards can be beneficial for business owners who have steady cash flow and want a way to make large purchases. You can avoid the risk of interest altogether and also have access to unrivaled card features that provide several valuable travel perks. However, there are other alternatives available if a charge card doesn’t fit your specific business situation.
Alternatives to Business Charge Cards
If you can’t afford to pay your credit card balance in full every month or need to finance a large purchase, you may want to consider an alternative. Some of the best alternatives to business charge cards include prepaid business credit cards, small business credit cards, corporate credit cards, and purchasing cards.
The best alternatives to business charge cards are:
Prepaid Business Credit Card
A prepaid business credit card is a great alternative to a charge card because it provides similar features when it comes to controlling employee expenses. Prepaid cards allow business owners to preload funds on employee cards and track their transactions. Additionally, they tend to have much lower qualifications than a business charge card and small business credit card.
Small Business Credit Card
A small business credit card is an excellent financing option if your business doesn’t have substantial revenue but needs access to capital. Business credit cards are not required to be paid off every month. If you can’t pay the full balance, your minimum monthly payment will be between 2% and 4% of the outstanding balance. If a business credit card best suits your business, you can shop and compare the best credit cards in our credit card marketplace.
Corporate Credit Card
A corporate credit card is best for businesses with $4 million in annual revenue, annual credit card expenses of $250,000 or more, and good business credit. Additionally, corporate credit cards are most effective for at least 15 cardholders or employees. Similar to business charge cards, corporate credit cards carry no annual percentage rate (APR) because the balance is due in full monthly.
A purchasing card (or P Card) is a type of commercial card that is used for business-to-business (B2B) purchases of goods and services without other payment methods, such as checks and automated clearing house (ACH) transactions. As with business charge cards, a purchasing card is also due in full every month. This means you won’t pay any interest on your purchases and there is no APR.
Frequently Asked Questions (FAQs) About Business Charge Cards
We covered a lot of information on business charge cards and when they’re beneficial. There are some questions that are asked more often than others, and we address those here. If you have any other questions, feel free to comment below or visit the Fit Small Business Forum, and we will provide an answer.
The most frequently asked questions about business charge cards are:
Do charge cards still exist?
American Express is the only major credit card issuer that offers business charge cards. A good rule of thumb is that if a card doesn’t carry an interest rate and is due in full every month, then it’s likely it’s a charge card. If it has an APR, it’s a credit card.
What qualifies you for a business credit card?
To qualify for a business credit card, you either need an employee identification number (EIN) or you can use your Social Security number (SSN). Additionally, most credit card issuers require you to have a good personal credit score (of at least 640) to qualify. However, we recommend having a score of 670 or higher.
What is the difference between a credit card & a charge card?
The main difference between a credit card and a charge card is the ability to carry a balance from month to month. Charge cards don’t extend credit, and you’re required to pay off the balance in full monthly. Credit cards are expected to be paid off every month, but only require a monthly minimum payment.
Overall, business charge cards are an excellent alternative to a business credit card if you can afford to pay your balance off in full monthly. Charge cards carry no interest and generally have no preset spending limit. They’re most beneficial for business owners who are well qualified and have personal credit scores of 670 or more.
For rates and fees on the American Express Business Platinum Card®, please click here.
For rates and fees on The Plum® Card From American Express, please click here.
For rates and fees on the American Express Business Green Rewards Card, please click here.