What is a business credit card?

A business credit card works much like a personal one but is specifically for business spending only. Whether you’re a sole trader or run a limited company or charity, it can help you manage expenses, keep business and personal finances separate, and maintain a clear record of transactions.

You can use a business credit card for any business-related transactions, including equipment, travel costs, entertainment, office supplies and subscriptions. Some cards also come with useful features such as unlimited employee cards, expense tracking tools, and rewards programmes like cashback or air miles on everyday purchases.

Some business cards offer higher credit limits than personal cards, making it easier to cover larger expenses. Using the card responsibly can also help build your business credit score, which may make it easier to access finance in the future.

Is my company eligible for a business credit card in the UK?

To apply for a business credit card, your company will need to meet a few basic requirements. While each provider sets its own criteria, you’ll likely need to tick the following boxes:

  • Age requirement: Applicants are usually required to be 18 or over.

  • Business status: Be a UK-based business or charity.

  • Minimum trading period: Lenders may want to see one year or more of trading history.

  • Solid credit history: Expect checks on both your business credit file and the director’s personal credit record.

  • Authorisation: You must typically be a sole trader, partner or company director authorised to borrow on behalf of the business or charity.

  • Proof of income: Recent bank statements, turnover figures or business accounts may be requested.

Meeting these conditions doesn’t guarantee approval, but it can give your business a better chance of being accepted.

How do business credit cards work?

Business credit cards work much like personal ones, but they’re designed with company spending in mind. Here’s how they typically operate:

  • Use your card/s for business spending: Ideal for everyday expenses like office supplies, fuel, travel and software subscriptions.

  • Collect your points: Many business cards offer rewards like cashback, travel points (e.g Avios) or other perks every time you spend.

  • Make monthly repayments: Clear your balance in full to avoid interest, or pay at least the minimum amount to keep your account in good standing.

  • Track and manage expenses: Some business cards come with access to apps and tools to check and analyse business spending, set employee limits and manage expenses efficiently.

  • Build your business credit: Regular, timely repayments can strengthen your company’s credit score and improve access to finance in future.

How much can I borrow on a business credit card?

Business credit card limits in the UK vary widely, depending on factors like your company's financial health, revenue and creditworthiness. Here's a general idea of what you might expect:

Standard credit limits

Depending on the provider, initial credit limits often range from £500 to £25,000. At least one provider requires copies of your annual accounts or tax returns for the last two years if you require a credit limit over £10,000.

High-limit credit cards

Some providers offer credit limits of £250,000 or potentially even more, subject to status. These higher limits are usually available to businesses with strong financial profiles, a high turnover and a proven track record.

It's important to note that the actual credit limit you receive will depend on your business's specific circumstances, including its credit history, revenue and financial stability.

Are there any costs or fees involved with business credit cards?

Most business credit cards come with a few costs to consider. The exact charges vary between providers, but the most common ones include:

  • Annual or cardholder fees: Some providers charge a yearly fee, particularly if you have multiple employee cards.

  • Interest charges: If you don’t pay your balance in full each month, interest will be added to what you owe.

  • Foreign transaction fees: Purchases made abroad or in another currency may include a percentage fee.

  • Cash withdrawal fees: Taking cash out on your business card can be costly, as it usually triggers an immediate handling fee and interest.

  • Late or default fees: You could be charged if you miss a payment, go over your limit, or have a payment returned.

  • Administrative fees: These may apply for services like replacing a lost card or requesting copies of transactions.

As an example, one leading UK provider includes the following fees and charges with their business credit card: no annual fee for the first 12 months, and an annual fee of £32 per cardholder after that – unless you spend £6,000 or more across all cards each year. They also apply a 2.5% handling fee for cash withdrawals, £5 for copies of transaction receipts and £12 for late payments, returned payments, or going over your business credit limit.

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Answering your questions about business credit cards

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