Editor’s note: This is a recurring post with regularly updated card details.
Life can throw unexpected situations at business owners that can cause less-than-perfect credit. Business owners with bad credit can use business credit cards with fewer requirements. These cards make it easy to get a business card and improve credit—as long as you’re open to unconventional options, including fair credit, secured, and debit card options.
The best bad credit business credit cards are:
- Capital One® Spark® Classic for Business: Best overall for business owners with fair credit (580 and 669)
- Wells Fargo Business Secured Credit Card: Best for building business credit with a secured card
- Discover it Secured Card: Best for sole proprietors and freelancers
- Bento for Business Prepaid Card: Best for card use with no credit check
Capital One® Spark® Classic for Business: Overall Best for Business Credit Card for Bad Credit
Capital One® Spark® Classic for Business
BEST FOR
Fair credit business owners (580 to 669)
- 1% cash back every time you swipe
- Build your business credit through responsible usage
- Issue employee cards for free
Pros
- Opportunity to build business credit
- Earn fixed-rate rewards even with fair credit scores
- Rewards never expire
Cons
- High APR
- No sign-up bonus
- Reports to personal credit bureaus
- Purchase protection: Capital One will replace, repair, or reimburse you for eligible items in the event of theft or damage within the first 90 days of purchase.
- Extended warranty protection: You’ll get additional warranty protection on eligible items that are purchased with your business card, up to 1 year past the manufacturer’s warranty.
- Auto rental collision damage waiver: You’re covered for damage due to collision or theft when you rent an eligible car with your Capital One® Spark® Classic for Business card.
Why we like it: If you have less-than-ideal credit, Capital One® Spark® Classic for Business is your best opportunity for a traditional business credit card without a security deposit. This card’s specifically designed for business owners with personal credit scores between 580 and 669. Plus, it’s free to own this card, so you won’t have to worry about an annual fee.
Fair credit doesn’t mean you’ll have to miss out on rewards because this instant approval business credit card also earns rewards on every purchase you make. That’s unlimited rewards you can redeem at any time. Although earning rewards probably isn’t your priority, it’s nice to know that you get a card feature that’s typically reserved only for those with higher credit scores.
Wells Fargo Business Secured Credit Card: Best for Building Business Credit With a Secured Card
Wells Fargo Business Secured Credit Card
BEST FOR
Business owners with poor credit
- Cash Back option: Earn 1.5% cash back on every $1 spent
- Reward Points option: Earn 1 point on every $1 spent and receive 1,000 bonus points when your company spend is $1,000 or more in any monthly billing period
- $0 annual rewards program fee
- $500 to $25,000 credit line
- Zero liability protection
Pros
- Approval with credit scores below 580
- Your choice of fixed-rate cash back or points rewards
Cons
- Requires a security deposit of at least $500
- Has an annual fee
- Purchase Assurance: Wells Fargo will repair, replace, or reimburse you for items that are damaged or stolen within 90 days of purchase.
- Design Studio: Include a personal image or business design on your credit card.
Why we like it: The Wells Fargo Business Secured Credit Card is the best secured card that allows you to build business credit and earn rewards. Secured cards have credit limits equal to a cash deposit held in a collateral account, and you’ll need a minimum $500 cash deposit to qualify for this easy approval business credit card. This means the minimum credit limit for this card is $500. You can increase your credit limit by making a larger deposit for a maximum limit of $25,000.
Once you open this card, you’ll be able to add up to 10 employee cards. Even better, Wells Fargo removed this card’s previous annual fee, so adding additional cards is more convenient. Plus, the flat-rate rewards you earn, your choice of points or cash back, is a nice but unexpected perk. This card’s rewards coupled with the ability to build business credit make this card a great business credit card for startups as well.
Wells Fargo also periodically reviews your card activity for responsible use and consistent payments. You may have an opportunity to upgrade to a traditional Wells Fargo business credit card if you keep timely payments. In that case, you’ll get your initial deposit returned to you, and you’ll get the benefits that come with a standard business card.
Discover it® Secured: Best for Sole Proprietors and Freelancers
Discover it® Secured
BEST FOR
Business owners who need help rebuilding personal credit
- No Annual Fee, earn cash back, and build your credit with responsible use.
- It's a real credit card. You can build a credit history with the three major credit bureaus. Generally, debit and prepaid cards can't help you build a credit history.
- Establish your credit line by providing a refundable security deposit from $200-$2500 after being approved. Bank information must be provided when submitting your deposit.
- Automatic reviews starting at 8 months to see if we can transition you to an unsecured line of credit and return your deposit.
- 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases every quarter, automatically. Plus, earn unlimited 1% cash back on all other purchases.
- Get 100% U.S. based customer service & get your free Credit Scorecard with your FICO® Credit Score
- We automatically match all the cash back you've earned at the end of your first year.
- Receive Free Social Security number alerts— Discover will monitor thousands of risky websites when you sign up.
Pros
- Earns ongoing cash back rewards
- Deposit is refundable
- Free FICO credit scores
Cons
- Requires security deposit of at least $200
- No 0% APR period
- High ongoing APR
- FICO® Credit Score: Receive free FICO® scores and monitoring.
- Discover® Identity Alerts: Get free Experian credit report and dark web monitoring.
- Freeze it®: Protect your account by stopping account activity in the event of suspicious card activity or if your card is lost or stolen.
Why we like it: Sole proprietors are closely tied to their personal credit because they don’t have separate business credit profiles. That’s what makes the Discover it® Secured a great fit for freelancers and sole proprietors. This personal card offers a chance to build your personal credit with just a minimum deposit of $200, which makes up your total available credit limit.
Discover also conducts reviews every eight months to see if you qualify to graduate to a traditional credit card. If you are eligible for an upgrade, it offers to reimburse your deposit. Plus, some business credit bureaus use your personal credit to calculate your business credit score, so this personal card can be a much-needed foundation for building business credit.
As an added perk, this card also earns flat-rate rewards on purchases, which Discover will double for the first year. So, you can use this card for business lunches and gas expenses while earning its best rewards.
Bento for Business Prepaid Card: Best for No Credit Check
Bento For Business Visa® Debit Card
BEST FOR
Managing employee expenses without a credit check to qualify
- Instant Decision
- No Credit Check Required
- One-click card controls & expense reports
Pros
- Get the first two cards for free
- Easily manage employee expenses
- Additional card features and purchase protections
Cons
- Large fees for more than two cards
- Deposited funds are required
- Won’t help build business or personal credit
- Auto rental collision damage waiver: Use this card to pay for your entire auto rental transaction and get collision coverage for a damaged or stolen rental vehicle, up to the value of the vehicle.
- Purchase protection: Purchases are covered up to 90 days for damage and theft, up to $10,000 per claim, $50,000 per year.
Why we like it: The Bento for Business Prepaid Card offers business owners with bad credit an easy way to manage employee expenses. Your credit isn’t a factor with this card because you’re responsible for funding the available balance. This also means you won’t have your personal or business credit pulled during application. However, you’ll need to make a deposit before making any transactions since this card is funded solely by your prepaid deposits.
Bento offers your first 60 days for free. After that, you’ll pay between $29 and $149, depending on the number of cards you need. If you need up to 10 cards, expect to pay $29 per month. The number of cards you can order is unlimited, and each card has a daily spending limit of up to $25,000. If you want to avoid a credit check at all costs, this business debit card is a decent alternative option to the others on our list.
Improving Your Credit With a Business Credit Card
If you find yourself with damaged credit, business credit cards offer a great way to build your credit. Follow these tips to improve your credit over time:
- Keep your credit utilization low: By cutting your spending and keeping your credit utilization ratio below 30%, you can reduce the debt you’ve accumulated and improve your credit score.
- Monitor your credit report: Many credit card issuers offer free credit monitoring and free credit scores. However, one of the best ways to improve your credit is to check your full credit report and have any discrepancies removed.
- Pay down existing debt: One of the best ways to improve your credit is to pay down your debt as quickly as you can. You can do so by making large payments or by making multiple payments in the same billing cycle to pay off your debt fast.
- Be mindful of credit applications: Be aware of what products and services you apply for that require a credit pull. Having too many hard credit inquiries on your credit report can lower your credit score. Keep your credit applications to a minimum to avoid a negative impact on your credit.
How We Evaluated Bad Credit Business Credit Cards
Business owners struggling to improve their credit need access to small business credit cards with fewer requirements. For this reason, we primarily focus on cards with fewer credit score requirements. We also took into account card costs over traditional card features like rewards and additional perks.
Bottom Line
There’s no understating how challenging it can be for business owners with bad credit to conduct normal business activities. But business credit cards for bad credit can help business owners with undesirable credit secure short-term funding and easily manage employee expenses. Although these cards don’t have the bells and whistles traditional cards offer, they give you a means to improve your credit until you qualify for a better card later.
