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A business credit card is a must have for an entrepreneur who wants to keep their personal and business finances separate and for anyone looking to establish their business’s credit history. It’s understandable why making a personal guarantee in order to secure a business credit card would make some entrepreneurs nervous. Let’s take a closer look at why personal guarantees are often required for business credit cards — and how to avoid them. Why business credit cards require personal guaranteesIt can be very difficult to get a business card for a startup with no personal guarantee. Here’s why: When you start a new business, card issuers are taking a big risk by lending you money. If the business fails, they want to get paid back. By asking you to give a personal guarantee, they have the option of going after your personal assets (to get what they are owed), which are likely to be more substantial than those of a brand-new business. That said, not all startups are the same. If you’ve created a high-revenue startup in your first year or two, you might qualify for a business credit card that doesn’t require a personal guarantee. In other words, card issuers may be willing to try to go after the assets of the business if you don’t keep up with payments. However, these cards generally have stringent requirements for applicants. Best no-personal-guarantee business credit cardsThese are some of the best business credit cards that don’t require personal guarantees and also come with some great perks: Brex Corporate Card for Startups: Best introductory offerWhy we picked it: Designed for venture capital-backed startups, the Brex Corporate Card for Startups* has no annual fee and unlimited points, plus it requires no personal guarantee. Pros
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Who should apply: Corporations and non-individual limited liability companies are likely customers for this card. Who should skip: If you’re a sole proprietor, an unincorporated partnership or an unregistered business, you should look elsewhere. American Express Green Card: Best for business travelersWhy we picked it: The American Express® Green Card* offers a chance to earn 3 points per dollar on travel, transit and dining worldwide, which makes it a good fit for entrepreneurs who need to travel a lot for work. Pros
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Who should apply: Travel-heavy entrepreneurs can get a lot of value out of this card. Who should skip: Business owners that never need to travel should look at other options. American Express Gold Card Review: Best for wining and diningWhy we picked it: The American Express® Gold Card* is a great option for businesses that frequently entertain clients or have a large number of employees for whom food is purchased. It earns 4 points per dollar at restaurants and 4 points per dollar at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X). Pros
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Who should apply: Businesses with an emphasis on sales or client services should definitely consider this one. Who should skip: Businesses that don’t spend money on food or dining won’t get maximum value from this card. Stripe Corporate Card: Best for no interestWhy we picked it: The payment processor Stripe has also issued a corporate card that doesn’t require a personal guarantee to businesses that use Stripe and it doesn’t charge any interest or fees. Pros
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Who should apply: Businesses that use Stripe and are looking to earn cash back will find this card useful. Who should skip: Businesses with small payment volume should probably look elsewhere. Bremer Bank Visa CommUNITY Credit Card: Best for nonprofitsWhy we picked it: If your startup is a nonprofit, consider the Bremer Bank Visa CommUNITY Card, designed specifically for nonprofits and municipalities. It comes with generous credit lines and grants access to a free rewards program. Pros
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Who should apply: Nonprofits and municipalities will appreciate the generous credit lines and free rewards program. Who should skip: For-profit companies don’t have the option of applying for this one. Bottom lineFor most small business cards, you’ll have to provide a personal guarantee. If that’s the case, make sure you never borrow more money to grow your startup than you can afford to personally pay back. It’s better to grow slowly and fund that growth through cash flow than to put yourself in a precarious financial position. No entrepreneur can make good decisions under crushing debt. By avoiding it, you’ll have the peace of mind you need to realize your vision for your business. All information about the Brex Corporate Card for Startups and the American Express® Green Card has been collected independently by CreditCards.com and has not been reviewed or approved by the issuer. Editorial Disclaimer The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners. Elaine Pofeldt writes the Your Business Credit column for CreditCards.com, answering a question every week about small business and credit. Pofeldt is a journalist who specializes in entrepreneurship and careers, contributing to publications such as CNBC, Forbes, Money, and many others. She is the author of “The Million-Dollar, One-Person Business,” a look at how solo entrepreneurs are scaling to seven-figure revenue without hiring employees. She is a former senior editor at Fortune Small Business magazine and co-founder of www.200kfreelancer.com, a website for independent professionals. Can a business get a credit card without a personal guarantee?If you don't want to take this risk, then you can opt for a business card that doesn't require a personal guarantee. An established small business with substantial annual revenues can usually qualify for business credit cards without a personal guarantee. Your options include charge cards, store cards, and debit cards.
Can I use my EIN to get a credit card?In some cases, corporate credit cards don't require an SSN, meaning you can get a business card with an EIN only. Corporate cards have stricter application rules. In most cases only certain types of businesses are eligible, and your business may need to earn a certain profit margin each year.
Does Capital One business card require personal guarantee?Capital One® Spark® Classic for Business* vs.
That's because the card doesn't require a personal guarantee and instead relies on your company's cash flow and financial backing to determine credit limits.
What is the easiest business gas card to get?What business gas card is easiest to get?. Capital One Quicksilver Student Cash Rewards Credit Card.. Discover it® Secured Credit Card.. Shell | Fuel Rewards® Mastercard. ®. Techron Advantage Visa Credit Card.. |