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5 tips for choosing the ideal small-business credit card

3 min read


This Spotlight on Business Credit Cards is brought to you by American Express OPEN, the leading issuer of small-business credit cards and charge cards in the U.S. OPEN offers business owners products and services to help them run and grow their businesses.

Experts agree it makes sense for a small business to have a credit card, if only to improve record keeping and prevent intermingling of the owner’s personal and business credit, but the subject can suddenly get quite confusing when it comes to the question of choosing the right card for your company.

There are many points to consider before picking a small-business credit card, including understanding the costs of carrying a balance and having a clear picture of your spending habits.

Many sources, including the Small Business Administration, offer additional tips on choosing a credit card and here are the top five we found.

  • Evaluate interest rates and fees and make sure to look beyond introductory promotional rates, because you’ll ideally be choosing a card for the long haul. Review monthly and annual fees for each card you’re considering, and ask yourself what benefits your business will derive from paying fees in addition to interest.
  • Compare the loyalty rewards offered to the perks you need. If your business requires heavy travel, you may want to choose a card that rewards frequent fliers. If not, you could opt for a card that rewards purchases at office-supply stores or other merchants selling products your business uses.
  • Clearly understand the repayment terms, grace period and late fees if you don’t make a payment on time. While paying on time protects your credit score, if you’re late with a payment because money is tight, the last thing you want is a hefty late fee adding to your troubles.
  • Look at options for balance transfers if you’re looking to switch from a card with a higher interest rate. Banks often charge a fee to transfer balances, but some offer free transfers as a perk of signing up for the card. Likewise, find out whether the card offers the option of cash advances. The perk can come in handy in situations where the company needs quick cash, but most cards offer no grace period on advances and interest rates can vary.
  • What are the options for paying your bills and managing account records online? A surprising number of companies still don’t allow customers to make online payments, according to the SBA.

Customer service is one final thing to consider as you’re evaluating the various cards out there, and the best way to do that is to interact with real people at each company as you’re doing your research, to get a feel for the best fit.