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Credit cards are an important aspect of American finances—70% of Americans use at least one. Business owners are a key part of this demographic, but their needs and access to credit cards are a little different than the average consumer. Many small business owners rely on business or corporate credit cards for quick funding and daily operations, but fail to realize all of the benefits of a business-specific credit card. 

Today we’re breaking down the differences between business and personal credit cards, how you apply, how they’re used, and which you should choose.

Business credit cards vs. personal credit cards

Most Americans are familiar with personal credit cards. They’re offered through banks and retailers, feature credit limits and annual percentage rates (APR) of interest, and require monthly payments on the balance. Personal credit cards are heavily regulated and offer strong protections against fraud or theft. Rewards and cash back are usually available, depending on the type of card. 

Business credit cards differ in a few key ways. Sometimes referred to as a corporate credit card, a business credit card is specifically designed for businesses. They usually feature higher limits and more lucrative payouts when it comes to rewards. However, they are less regulated, so issues with fraud and changing APRs can create problems. Finally, there is an entirely separate credit score for a business and it’s affected differently than a personal credit score.

We’ll begin with credit scores, since they are critical to understand for business and personal credit cards. 

Credit scores & reporting

There are four different credit scores you need to be aware of as a business owner.

Credit score range Acceptable minimum for funding Excellent score
Personal 350-850 600 800
D&B PAYDEX 1-100 50 80+
FICO SBSS 0-300 140 180
Experian 1-100 51 76

Personal credit scores 

Your credit score is an indication of your financial health and the likelihood that you’ll pay back any money that is loaned to you. Your credit score is determined by many factors, including how many credit sources you use, your debt-to-limit ratio, late payments, and account histories (all of which are reported to the three major credit bureaus: Experian, Equifax, TransUnion). A personal credit score ranges from 350-850, and you’ll need 600 or greater to qualify for most credit cards and loans. The higher the credit score on your personal credit report the more likely you are to have a higher credit limit. 

If your business is new or lacks a credit history, your personal credit as the owner will likely be used for initial funding (or for collateral default). Applying for a personal credit card will involve a “hard check” on your personal credit score–pulling a personal credit report. Pulling too many credit reports can negatively impact your score. 

Business credit scores

Similar to personal credit cards, your business credit score is calculated through analysis of factors such as your payment histories and use of credit in the past. This data is gathered by business credit bureaus (Experian, Equifax, and Dun & Bradstreet). D&B PAYDEX and Experian use a range of 1-100, while FICO SBSS uses a score of 0-300. Each business credit bureau has different standards for what is considered an excellent credit score.

Your business credit score will determine your ability to secure financing on agreeable terms as well as your spending limit, so it’s critical to have the highest score possible. For many business credit cards you will be required to have a healthy minimum credit score (usually 140/300) to apply. If your business credit score is low or nonexistent you can work to establish and build a better business credit score

Applying for a business credit card will involve a “hard check” on both personal and business credit scores. Your business credit card will report to the business credit bureaus, so good and bad behavior will be reflected on your business credit score—but note that the outstanding balance on a business credit card will fall to your personal credit score if your business fails.


Accumulated points are the most common form of credit card rewards, and usually aggregate with purchasing. Rewards for business credit cards are tailored for business owners, and personal credit card rewards are usually tailored to individuals. For example, a small business credit card may offer double points for shipping expenses, while your personal credit card offers double points on grocery purchases. 

Personal credit cards tend to reward daily and recreational spending, such as groceries, restaurants, gas stations, and entertainment like movie theaters or streaming services. Retail-specific cards, such as a Target Red Card, can offer brand rewards like free shipping, discounts, and early access to sales and promotional events. 

Business credit cards typically offer more reward points but require more purchasing. This is a beneficial arrangement for businesses that will spend more than an individual, prompting many small businesses to make the jump from a personal to business credit card.


All credit cards use fees to penalize late payments or charging over your card’s limit. Both personal and business credit cards have options with and without annual fees. One fee that business owners in particular need to take into consideration is foreign transaction fees, which can become expensive if your business does international purchasing. 

Business credit cards can offer lower APR, both generally and as introductory rates. However, these rates and fees are not regulated as staunchly as personal credit card rates and fees, meaning you can face interest rate increases and heavy fees with your corporate card.

Credit card FAQs

How do you apply for a business credit card? How does the process differ than getting a personal credit card?

The application process for a business credit card is similar to a personal credit card process,  however, unlike a personal credit card, a business credit card requires a hard check of both personal and business credit scores. This will determine which company cards you’re eligible for, as well as your interest rates and borrowing limits. For some types of business credit cards and programs you may be required to show income records for the business, or the EIN (Employer Identification Number).

A business credit card requires a personal guarantee for the funds in the event your business fails.

How do the requirements for a business credit card differ than that of a personal credit card?

To apply for a personal credit card you need to be 21 years of age (or 18 if you have verified income or parent approval). Users need to have a source of income, though college students can still get student credit cards with very little income. A good credit score of 700+ is required for most credit cards, but secured cards or credit-rebuilding cards are available for those with poor credit or just starting out. 

In addition to the requirements for personal credit cards, business credit cards must be used for business purposes, so business owners who use a credit card for both personal and business expenses should opt for a personal card for those uses. 

Business credit cards also have restrictions on use for payroll, mortgage or rent payments, and certain types of invoices. Misusing a credit card, even if you pay it off monthly, is a violation of the agreement and can lead to your card being shut off by the provider. 

When should you get a credit card?

You should get a personal credit card when you need to build credit, and can responsibly pay off your balance each month. 

You should get a business credit card as soon as you begin making regular, dedicated purchases on behalf of your business.

Personal credit cards can quickly become a devastating financial crutch if used improperly, so you want to wait to open a credit card until you know you can use it responsibly (keep the balance low, pay it off each month). A personal credit card can be a great option for taking advantage of rewards programs for your regular purchases, for reimbursable business expenses, or for emergencies. 

A business credit card provides four major benefits for your company: 

  1. Separates business & personal credit—protecting both
  2. Builds business credit with responsible use
  3. Fast, accessible capital
  4. Business-specific rewards

The longer you wait to open a business credit card, the longer you wait to claim these important benefits for your business. 

How do you choose a credit card?

You have no shortage of options when it comes to finding a credit card. The right credit card for you is the one that meets your unique needs. Here are a few features to consider.

Factors to consider when choosing a personal credit card

  • Credit score: Your credit score will determine the credit cards for which you qualify, as well as the credit limit and interest rates available to you. 
  • Issuing Institution: You can often get better terms from your bank or credit union, or consider a card from a retailer where you frequently shop. 
  • Introductory 0% APR: Low or no-interest introductory rates are great for making lots of up-front purchases that you won’t be able to pay off right away. 
  • Travel: If you frequently travel, look for cards that provide international support and rewards. 

Factors to consider when choosing a business credit card

  • Introductory 0% APR: Low or 0% no-interest introductory rates are great for making lots of up-front purchases that you won’t be able to pay off right away. 
  • Annual fees: A higher annual fee typically means larger rewards, which might be worth it in the long run. Do the math to see if an annual fee (or lack thereof) is worth it for the way you use your card. 
  • Rewards: Bonus points when you make an eligible purchase or cash rewards are common credit card rewards. Check for specialized tiers of points or spending, as well as perks like memberships or discounts. 
  • International transactions: Are international transactions free or charged the standard 3% fee?
  • Travel rewards: Look for cards that give you travel rewards such as miles and points for transportation, restaurants, hotels, rentals, and other travel expenses
  • Welcome bonus: Some cards offer a bonus for opening a new account, or a bonus after spending a certain amount within an introductory window (e.g. $1,000 back when you spend $5,000 in the first 3 months).
  • Multiple cards or accounts: Do you need cards for several members of your team? Will they need separate accounts? Are there fees or rewards associated with multiple cards? (Divvy allows you to give everyone a corporate card—for free.)
  • Virtual cards: An option for setting up virtual cards is best for businesses who make frequent online or subscription purchases.

A final note on credit cards

Credit cards are a convenient and effective way of managing business finances. However, it is critical to control the use of that credit card to protect both your credit score and future opportunities. Pay your bills in full and on time, and never allow anyone (employees, friends, or family) access to your credit cards.

Need a business credit card that helps you spend, budget, and save? Sign up for Divvy today.

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