Business Credit Cards For New Business With No Credit?

Remember your very first credit card? Even with zero credit history, an individual can still get approved for a student or secured credit card.

But is the situation the same for a brand new home or start up business? A basic no-frills card that will approve a company with limited to no credit history?

The answer is both yes and no – let me explain…

Retailer cards?

When I opened my LLC, I figured the easiest business credit card to get would be one from a retailer, such as Staples or Office Depot. Wow… was I in for a big surprise!

You would think that these types of cards would have very loose credit requirements. After all, it’s not like some office supply store is anything special, right? Well apparently they feel otherwise. Upon reviewing the application, here’s what I discovered…

business card requirements

That’s right, just to get approved for a petty office supplies store card, your corporation/LLC needs to be raking in $5 million in annual revenue AND have been around for a full 3 years. Obviously, this is not a business credit card for a new business to get! That’s even a tough thing for most established businesses to achieve, since I would guess a majority of small businesses operate in an area south of $5 million in annual sales.

Of course, you can still apply for a retailer card like that if you’re willing to co-sign with personal liability (so it’s not just under your business credit). But the question is… if you’re going to do that, why would you apply for such a low-level card? Wouldn’t it be preferable to apply for the Chase Ink or other major business credit card with rewards, benefits, and universal acceptance?

Conclusion? If you think store cards will be a good credit card for your new business, think again.

Major business cards?

As you know most of the big banks offer credit cards for businesses: Chase, American Express, Citi, Capital One, Discover, Bank of America, and others. So how many of those offer cards without a personal guarantee requirement? The answer is zero.

Whether it’s a major bank (such as the above examples) or a small regional bank, they all have one thing in common – in order for you to apply and get approved using only your company’s credit, you can’t be a new business. The qualifications are comparable (and sometimes even stricter) then the aforementioned Staples card, which kind of makes sense. The bank doesn’t want to be stuck holding the bag if your business goes south. They want to be able to go after the business owner on a personal credit level and get their money back.

Out of the major issuers, American Express, a CreditCardForum advertising partner seems to have the lowest bar to jump over. Back during the Great Recession they imposed a minimum of $5 million in annual sales to be approved (which is comparable to other banks). However after the economy improved, in 2012 they significantly lowered the requirements:

Green CardAmEx Green Business Card ($95 annual fee)

Have $10,000 per month in revenue and 6 months operating history.

Gold CardAmEx Gold Business Card ($175 annual fee)

Have $2 million in annual revenue and 6 months history history

Platinum CardAmEx Platinum Business Card ($450 annual fee)

Have $2 million in annual revenue and 6 months history

Note: By definition, corporate cards are the only ones which do not require a personal guarantee. Regardless of the bank, anything called a “business credit card” or “small business credit card” will require you to co-sign using your Social Security number. If you don’t want personal liability, then what you want is a corporate card.

With all of the above (and any corporate card out there) you will have to prove your qualifications. When I called AmEx’s customer support and asked, they said that during the application you will have to provide your company’s bank account info – they will then call and verify deposit amounts and other information.

As you can see, the Green Business Card is one of the best business credit cards for new business, but probably not a newly minted business. Your LLC/corporation needs to have been around for at least 6 months and pulling in a minimum of $10k per month in sales.

On the other hand, the requirements for the Gold and Platinum Business Cards are the same… $2 million in annual sales. If you’re just starting a new business, these probably won’t be options for you until down the road. All the other banks have similar minimums ($2-5 million annually) which makes the Green’s qualifications substantially below average.

Brand new businesses?

Obviously the American Express Corporate Cards are the best to aspire to… but none of them are for new businesses. So what should you do meanwhile?

If you’re comfortable doing so, your best bet will be to get a head start on the credit building process by signing up for a small business credit card using a personal guarantee. That’s because you can probably qualify (assuming your credit is decent), even if your company is only a day old and has zero revenue. And you can start building a credit history for your young enterprise and can qualify for a genuine corporate card down the road should you scale your business and decide to incorporate.

So what is the best startup card for your startup? My vote is for the Ink by Chase and it’s what I use myself. I also have AmEx business cards but the caveat with those is that they don’t report to Dunn and Bradstreet or Equifax Business credit bureau (so while AmEx small biz cards are great for benefits, they’re not useful for credit building).

Compare my favorite business credit cards here

Written or last edited on February 9, 2016

 
Comments
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I applied for AMEX I did not give the my SSN# but some how they pulled my personal credit 🤔 I wonder how that was possible. I made it clear to them I did not want to be a personal garentor and never provided my SSN

Christie McDermott

How many companies start out making 5 million a year??? Seriously?

Yep, a personal guarantee is a pre-requisite, but I’d be interested to find out at which point in time one can remove the personal guarantee and run on 100% business credit?

So if you get a “business” credit card but sign on with a personal guarantee, will they still use your tax ID to report to Equifix business and/or D&B? Also, do any of them allow you to use credit references such as voice/internet services, utilities, lease, etc?

How do I Build business credit with out my ss# if I have a D & B #? I also have a EIN#

To apply for a chase credit card; I think you have to give your personal information,such as DOB,SS#…home address for the last @ years.How can I get around this being a NEW LLC ?

Yesterday, i applied for a business credit card corporation status 3 .5 years in business with dnb and equifax reporting with gross of 150k but so far Only a homedepot credit card for 1500 credit line for 3 years. I applied online and got declined by both chase and citibank even though i used my ss# with an avg score of 700 and equjfax business score of 86 out of 100.

I sell drugs literally and upon starting a new business 3 months ago without bringing in 5 million I contacted amex directly and gave them a projected income due to the upcoming laws in colorado needless to say I got approved and never used my personal credit this legal marijuana is helping everyone.

And what projected income amount did you tell them

Tony I am very interested in how you got this done. What do I put on my application to get an approval without using my personal information. I only have a 600 credit score.

Tony how does one get into that business????

There is some miscommunication regarding the Office Depot or Staples business card. In order to get a corporate card/LLC without using a personal guarantee, your business needs to be raking in 5 million a year. This is not required if you’re a new business and willing to use a personal guarantor. This is required of most corporate cards. Your statement and example can be misleading to someone wanting to use those cards as credit builders for a new small business which they work great for.

Really helpful! I thank you!!