Best Credit Cards for Business Owners with Fair or Average Credit

As a business owner, having access to a reliable credit card can be crucial for managing expenses, building credit, and earning rewards. However, if you have a fair or average credit score, finding the right credit card can be challenging. Fortunately, there are several credit cards specifically designed to cater to business owners with fair or average credit scores. These cards not only provide essential financial tools but also offer opportunities to improve your creditworthiness over time.

In this guide, we’ll explore the best credit cards for business owners with fair or average credit, and provide tips on how to enhance your credit score. Let’s dive in and find the perfect card for your business needs.

Understanding Fair or Average Credit

Before we jump into specific card recommendations, it’s important to understand what qualifies as fair or average credit. Generally, a fair or average credit score ranges from 580 to 669 on the FICO scale. While this score range may limit your options compared to those with excellent credit, there are still valuable credit card options available.

1. Capital One Spark Classic for Business

The Capital One Spark Classic for Business is a solid choice for business owners with fair credit:

Credit Building: Designed to help you build your credit with responsible use.
1% Cash Back: Earn unlimited 1% cash back on every purchase, every day.
No Annual Fee: Keep costs low while you build your credit.
Credit Line Reviews: Opportunity for higher credit lines with responsible use.

Pros:

No annual fee, which makes it accessible for new business owners.
Flat-rate cash back on all purchases without the need to track categories.
Opportunity to increase credit line with responsible usage.

Cons:

Higher APR compared to cards available to those with better credit.
Limited additional perks and benefits compared to premium business credit cards.

This card is ideal for business owners looking to establish or rebuild their credit while earning simple, straightforward rewards.

2. Wells Fargo Business Secured Credit Card

The Wells Fargo Business Secured Credit Card is a great option if you’re willing to put down a security deposit:

Credit Limit: Deposit between $500 and $25,000 to establish your credit line.
1.5% Cash Back: Earn 1.5% cash back on every purchase, or earn 1 point per dollar spent with no cap, plus 1,000 bonus points each billing cycle you spend $1,000 or more.
Credit Building: Helps build business credit with responsible use and reports to major credit bureaus.
Transition Opportunity: Potential to upgrade to an unsecured card with responsible use.

Pros:

Higher credit limits based on your deposit.
Rewards program that offers both cash back and points.
Reports to business credit bureaus, helping you build business credit.

Cons:

Requires a security deposit, which ties up capital.
Annual fee, which adds to the cost of maintaining the card.

This secured card is perfect for business owners who need to build or rebuild their credit and are willing to make an initial deposit.

3. BBVA Secured Visa Business Credit Card

The BBVA Secured Visa Business Credit Card offers flexibility and rewards for those with fair credit:

Credit Limit: Deposit ranges from $500 to $25,000 to establish your credit line.
Rewards Program: Earn 1 point per dollar spent, redeemable for travel, merchandise, and more.
Credit Building: Reports to business credit bureaus to help build your credit.
Annual Fee: Low annual fee compared to other secured cards.

Pros:

Customizable credit limit based on your deposit.
Rewards program that offers a variety of redemption options.
Lower annual fee, making it a cost-effective choice.

Cons:

Requires a security deposit.
Limited availability, as BBVA does not operate in all states.

This card is a good choice for business owners who want to earn rewards while building their credit.

4. Brex Card for Startups

The Brex Card for Startups is designed for newer businesses and doesn’t rely on the owner’s personal credit score:

No Personal Guarantee: Approval is based on your business’s financial health, not your personal credit.
Rewards: Earn 1 point per dollar on all purchases, with higher rates for specific categories like travel and dining.
No Annual Fee: Keep costs low with no annual fee.
Credit Building: Helps build your business credit profile.

Pros:

No personal guarantee required, protecting your personal assets.
Generous rewards program tailored to startup expenses.
No annual fee, which is beneficial for new businesses with tight budgets.

Cons:

Requires a review of your business’s financial health for approval.
May not be suitable for businesses with inconsistent cash flow or financials.

This card is ideal for startups looking to separate personal and business credit and earn rewards without a personal guarantee.

5. Bank of America Business Advantage Unlimited Cash Rewards Secured Credit Card

The Bank of America Business Advantage Unlimited Cash Rewards Secured Credit Card offers cash back and credit building:

Credit Limit: Secured by a refundable security deposit of $1,000 to $10,000.
1.5% Cash Back: Earn unlimited 1.5% cash back on all purchases.
Credit Building: Reports to business credit bureaus to help build credit.
Opportunity to Graduate: Potential to upgrade to an unsecured card with responsible use.

Pros:

Consistent cash back rate on all purchases.
Opportunity to transition to an unsecured card.
Supports credit building with reports to business credit bureaus.

Cons:

Requires a significant security deposit.
Annual fee, although it’s relatively low compared to other secured cards.

This card is perfect for business owners looking to build credit while earning consistent cash back.

Tips for Improving Creditworthiness

While using these credit cards can help you build or rebuild your credit, it’s also important to adopt good credit habits to improve your creditworthiness over time. Here are some tips:

Pay On Time: Always make your payments on time to avoid late fees and negative marks on your credit report.
Keep Balances Low: Maintain a low credit utilization ratio by keeping your card balances below 30% of your credit limit.
Monitor Your Credit Report: Regularly check your credit report for errors and address any discrepancies promptly.
Avoid Opening Too Many Accounts: Opening multiple credit accounts in a short period can lower your credit score.
Use Credit Responsibly: Only charge what you can afford to pay off each month to avoid accumulating debt.

Conclusion

Finding the right credit card as a business owner with fair or average credit can be a challenge, but there are several options designed to meet your needs. By choosing a card that offers opportunities for credit building and rewards, and by practicing good credit habits, you can improve your creditworthiness and set your business up for future financial success.

Which credit card do you think is the best fit for your business? Share your thoughts and experiences in the comments below!