Keeping your personal finances separate from your business finances sounds like a good idea. Business credit cards are one of the best ways to separate finances. A business credit card is indispensable for many business owners as it helps them run their business efficiently and keep cash flowing. So, can you get a credit card for your business without an SSN or a personal guarantee?
Here, we cover how to apply for a business credit card with just an EIN. Why a dedicated business credit card is a good option? Despite the importance of this step for separating finances, we’re here to discuss whether it’s feasible to apply for a business credit card without an SSN.
We’ll also explore what an EIN is, whether it’s possible to get an EIN-only card, the pros and cons, the types of credit cards you can get using an EIN, why some issuers don’t accept EIN-only, and the other alternatives that will help you keep your finances separate.
What is an EIN?
The Employer Identification Number, or EIN, is a unique nine-digit number issued by the Internal Revenue Service (IRS) for any business entity. Its purpose is to help businesses report their taxes. EIN is different from the individual taxpayer identification number. The taxpayer identification number is issued to individuals and not to companies. Besides tax reporting, EIN enables businesses to apply for credit cards and open a business bank account.
Can You Get a Credit Card for Your Business With Just Your Ein?
There is no easy answer to that question. While getting an EIN-only business credit is possible, it’s not always easy. Also, the rules don’t apply to many businesses, especially for small businesses. We’ll explain later why some card issuers don’t approve applications with only an EIN.
Let’s see who can apply for a business credit card with EIN. Established corporations can easily apply for a business credit card with an EIN only. After all, they have significant assets, high revenue, and history. They are also considered a low financial risk to issuers. Small businesses are not eligible for business credit cards with EIN only.
Benefits of Using Just an EIN When Applying for Business Credit Cards
No Personal Liability
The benefit of using an EIN when applying for business credit cards is avoiding personal liability and limiting liability to the business alone.
Separate Business Expenses
Separating business expenses from personal expenses also helps businesses stay organized and helps with tax reporting.
No Effect on Credit Score
If you’re late in paying your business credit card, your personal credit score won’t be affected when you apply with your EIN only.
Building a Business Credit History
Applying for a business credit card with an EIN helps you establish a business credit history. As your business grows, so does a healthy credit history, which will help you secure funds to expand.
Using a personal credit card for your business robs you of a perfect opportunity to establish a credit history for your business.
Having Poor Personal Credit
If your personal credit report is not great, it won’t help when you apply for a credit card for your business with an SSN.
No SSN
No SSN is a fantastic option for non-US residents who don’t have an SSN, as they can easily apply for a business credit card through an EIN.
Cons of Business Credit Cards with just your EIN
Since business card issuers want to limit risk in case a business fails. They don’t issue business credit cards to new or small businesses. Most of the time, they issue EIN-only business credit cards to corporates, or in other words, to established businesses with high revenue.
So, although an EIN-only business credit card is a fantastic solution for businesses for various reasons, unfortunately, many businesses don’t qualify for that solution.
What Business Credit Cards Can You Get With Only an Ein?
Let’s discover some business credit cards you can only get with an EIN and which businesses qualify.
Corporate Credit Cards
Corporate credit cards are for large and trusted corporations with high revenue and many employees and pose no risk for card issuers. Established businesses can easily apply for a corporate credit card with no EIN.
Corporate Gas Cards
Fuel cards help you with filling up your fleet with gas. You can’t purchase anything else with a fuel card. For this card, you qualify with your business profile. Your personal credit is not needed. No personal guarantee is required.
A corporate gas card is for businesses with high revenue: a million dollars or more. You save money because you earn rewards whenever you fill your tank with gas. The Shell Small Business card is a good option.
Secured Business Credit Cards
A secured business credit card is a good option if you want to apply for your credit with EIN only. It is easy to get because it comes with lower risk for the lender as businesses place a security deposit. A secured business card is easier to get with an EIN only. It is different from other unsecured business cards.
Why Would a Small Business Need a Business Credit Card With Just an Ein, Not an SSN?
For various reasons, a small business would want a business credit card with only an EIN. Separating personal finances from business finances is the main reason. Building a business credit score is another. And finally, not allowing a bad credit score to interfere with your business.
Since this option is not available for small businesses, there are some alternatives to separate your finances, which we’ll get to later in the article.
But first, let’s see why some issuers don’t approve applications with only an EIN, and do you proceed with applying for a business card using your SSN?
Why Some Issuers Don’t Approve Applications With Just an Ein?
It all comes down to risk. Card issuers want to limit risk. Many small businesses fail and blunder, and credit card issuers want guarantees that the applicant will pay the debt. Card issuers use the SSN to review the applicant’s credit score and record to verify the applicant’s ability to pay the debt if the business undergoes problems.
Should You Apply for a Business Credit Card Using Your SSN?
Sometimes, a small business owner can’t apply using only an EIN. Business owners have to apply for a business credit with an SSN. Here are some things you should consider.
- Before you apply for a business credit card with your SSN, make sure you have a good personal credit history and personal credit reports.
- When applying using an SSN, pay your business card on time so late payments don’t affect your credit score.
Other Alternative Options to Keep Your Business Finance Separate
If applying for a business credit card with your EIN is not possible for you, let’s explore some alternative options so you can keep your business finances separate.
Business owners can apply with card issuers that do not report to credit bureaus. Note that you’ll still submit your SSN so that they judge your creditworthiness. The application will start a hard credit inquiry without reporting to consumer credit bureaus. Some card issuers report to consumer credit bureaus, so it’s best to verify with business credit card issuers.
They might, however, report non-payment, affecting your credit score.
Best Business Credit Cards
Let’s see some of the best credit cards for small business owners or corporations.
#1 Shell Card for Small Business
Shell is a small business credit card that gives business owners payment flexibility and the option to carry a balance. It is a fuel card you can use only to buy fuel from Shell.
Pros
- No card fees
- You can use the card at nearly 13,000 Shell and participating Jiffy Lube® locations nationwide.
- 15% Discount at participating Jiffy Lube locations
- Purchase controls and detailed reporting
- This card offers rebates of up to 5 cents per gallon, depending on monthly spending.
Cons
- No custom networks for maintenance or fuel
URL: https://www.businessfleetsolutions.com/shell-fleet-solutions/
#2 Wells Fargo Business Elite Signature Card
This card is not suitable for small businesses. Only businesses with over $1 million in annual sales can apply for this card. Also, you should have a good credit score (700 – 749) to get this card. This card offers reporting and employee spending control.
Pros
- No card fees in the first year
- Travel Insurance
- No foreign transaction fees
- Spending control and reporting
Cons
- $125 annual fees after the first year
- Not suitable for small businesses
URL: https://www.wellsfargo.com/biz/business-credit/credit-cards/
#3 The Blue Business® Plus Credit Card from American Express
This card is perfect for businesses that spend less than $50,000 annually. Also, for the first 12 months, 0% intro APR on all purchases.
Pros
- No annual fees
- 0% APR on all purchases in the first year
- High rewards rate
- You can use credit beyond its credit limit
- Many airline transfer partners
Cons
- Foreign transaction fees
Check for more info here.
#4 Brex 30 Card
With a Brex 30 card, you don’t have to make a personal credit check before you apply because this business card doesn’t require a credit check or personal guarantee. You must link your business to a business bank account with a balance of $ 50,000 or more to get this card.
Pros
- No credit check and no personal guarantee
- No annual fee
- Unlimited virtual credit cards to team members with the ability to limit amounts for each card.
Cons
- Carrying a balance is not an available option.
- This card is unsuitable for small businesses as you must link your business to a bank account with a balance of $ 50,000 or more.
Apply from here.
#5 Bank of America® Business Advantage Unlimited Cash Rewards Secured Credit Card
This card is the only secured business credit card on this list and probably a unique card for small business owners with not-so-good personal credit scores. You have to make a security deposit to get a secured card.
Pros
- No annual fees.
- 1.5% cash back on all purchases
- Ability to upgrade to an unsecured version
- Minimum secured deposit is $1000
Cons
- Foreign and balance transaction fees on every transaction.
Check for more info here.
#6 Revenued Business Card
It’s not difficult to apply for a credit card with a bad credit score. The recommended credit is only 300 – 670 (bad to fair). So, your credit history won’t affect your approval for this card, unlike many traditional credit cards.
Pros
- 3% cash back on all card purchases
- The issuers of this card issuers don’t care about the perfect credit score
- No application or annual fees
- Cash flow determines your spending limit
Cons
- Hard-to-fulfill business revenue requirements that some small businesses can’t qualify for
Apply from here.
In Conclusion
Applying for a credit card for your business is a good step. We recommend you check the rules and regulations of each card.
You should ask about any personal guarantee and liability. You should ask if they report to consumer credit bureaus.
Do you need any personal credit checks? Do they report to personal credit bureaus or business credit bureaus? Will your business credit card account history show on your personal credit reports?
Many business credit cards suit the business needs of corporations and small businesses. We hope this article has helped you understand more about the options. Read rules and regulations, ask questions, and choose what suits your business.
FAQs
Can I get a credit card for my business using my EIN?
Yes, you can. However, this service is mainly for corporations with high revenue, so it is not for new or small businesses.
What’s the easiest credit card to get for your business?
There is no one-size-fits-all all. It all depends on the requirements of the credit card issuer and whether or not you fulfill those requirements.
Some credit cards, however, don’t need a personal guarantee or a good credit score like the Brex 30 Card.
What are some of the alternatives to separate personal from business finances?
One of the good options is to apply for business credit cards where issuers don’t report to consumer credit bureaus to keep both finances separate. Another way is to apply for a secured credit card and add a security deposit.
Does your personal credit score affect your business credit card application?
Yes, if you apply with your SSN. So, if you’re going to have a business credit card with an SSN, you should keep a good credit score.
Can you get a business credit card when you first start your business?
Yes, you can, but if you open the business credit card with your SSN, you’re responsible for any debts or charges.
What’s the difference between applying for a business credit card with SSN and EIN?
The difference is that you will help keep your business and personal finances separate with an EIN.
What are gas cards?
Fuel or gas cards are credit cards issued mainly for fuel only that you can use at gas stations. They are suitable for businesses with large fleets.
Is a secured business credit card a good option?
It’s a good option for small businesses with not-so-perfect credit scores. There are not many available secured credit cards.
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