As you (hopefully) know by now, the quickest way to earn miles and points and “hack” your way to free travel is to sign up for travel credit cards. But most people only apply for personal credit card offers, and they don’t realize that they could also be earning the welcome bonus from small business credit cards. Many of these cards offer big sign-up bonuses and unique perks not found with personal cards. So, if you’re not signing up for small business credit cards, you’re missing out on a lot of value.
You may have never considered applying for a small business credit card before because you didn’t think you could get approved. If that’s you, I have good news! It’s easier to qualify than you might think, and in this post I want to explain how almost anyone with a side hustle and a good personal credit score can get approved for a small business credit card.
Who Can Qualify For a Small Business Credit Card?
Many people hold back from signing up for business credit cards because they assume that only large and established businesses are eligible. However, that’s not the case at all — the term “business” can actually be used quite broadly. Basically, anyone who’s generating (or at least trying to) extra income outside of their day job can apply. Here are some examples of who may qualify:
- Someone that sells things online (Amazon, eBay, Etsy, etc.)
- Someone who does any type of freelance work (graphic design, programming, writing, etc.)
- Ride-sharing app drivers
- Food couriers
- Craftsmen (home improvement, sewing, baking)
Misconceptions About Small Business Credit Cards
Before we dive deeper into this post, I wanted to ease your mind from a few of the major misconceptions that people get hung up on when applying for their first business credit card. Remember, you just need a side hustle. You don’t need to a be a big business.
- You DO NOT need a legal business name with an EIN (Employer Identification Number) to qualify.
- Your business DOES NOT need its own address.
- Your business DOES NOT need to be profitable.
- Your business DOES NOT need to have employees.
- Your business DOES NOT need to fit into one of the categories listed on the credit card application.
Although small businesses eventually establish their own credit history, in most cases, card issuers will review your personal score to determine your company’s creditworthiness. As long as your personal credit score is good, you should have a decent shot of getting approved.
For example, Kara and I have both been approved for business credit cards for our YouTube channel, and I can almost guarantee you that they based their decision on our personal credit history and not the merit of our “YouTube business”.
Tips for Filling Out Your Application
Now I want to spend some time looking at a standard business credit card application. I’ll point out the spots where a lot of people get hung up, and I’ll give you guidance on how to fill it out. However, before we go any further, I want to stress the importance of being honest on your application!! DO NOT lie on your application to try to increase your odds of getting approved. It’s illegal. Ok, now that’s out of the way, let’s go!
1. Legal Business Name & Business Name on Card
If you’re operating a small side hustle you probably haven’t gone through the process of setting up a business entity with a legal business name (if you do have a legal business name, obviously put it in this field). If your business doesn’t have a legal name, just put your full name on this part of the application. Your “business name on card” can be your personal name or business’s legal name.
2. Tax Identification Number
This section is where a lot of people get hung up. If you’ve gone through the process of getting a legal business name for your business, you probably have an EIN. Add that here. If you don’t have an EIN, just add your social security number to this section on the form.
3. Type of Business
Obviously, if you’ve structured your business a certain way, select the corresponding business structure. For the side hustlers who used their personal name and social security at the beginning of the application, select Sole Proprietor.
4. Annual Business Revenue
Since the bank will most likely fall back on your personal credit history to approve your application, you’ll want to include the revenue from your business and your personal income in this section. For example, if you make $50,000 at your job, and your side hustle will make $10,000 in revenue this year, add them together and put $60,000 in this section.
5. Everything Else
Don’t put too much pressure on the rest of the application. Just answer the questions as honestly as possible. If you’re the only person that works at your business, just put 1 employee. You can use your personal address as your business. Plenty of people operate their business from home. Don’t stress about which category your business fits into, just pick the closest one or choose other. None of these answers are going to stop you from getting approved.
What Happens If You Aren’t Instantly Approved?
Keep in mind, it’s rare to be instantly approved for a business credit card. Most of the time your application will move to “pending” before being approved.
If you apply for a card and you get a message that your application is pending, the best thing to do is hold tight and wait for a decision. I normally recommend calling the reconsideration line immediately, but with business credit cards you may have a better chance of getting approved if you wait it out.
The thinking behind not calling the reconsideration line is that you still have a chance to get auto-approved within the system. If you get auto-approved, congratulations! You just successfully signed up for your first business card. If you get denied…
You’ll need to call the reconsideration line to give them more information and help them to better understand your business. To find the phone number for the credit card reconsideration line, just google “name of the bank + business credit card reconsideration phone number.” For example, if you applied for a credit card through Chase Bank, search “Chase Bank Business Credit Card Reconsideration Phone Number.”
When you call the reconsideration line, you can expect the phone rep to ask standard questions like:
- What’s the name of your business?
- What products do you sell?
- How long have you been in business?
- What’s your job title?
- How many employees do you have?
- Why do you need a business card?
There’s also a chance they’ll ask more in-depth questions like:
- What’s your annual revenue and expenses?
- What was your revenue last year?
- Are you currently operating at a profit or a loss?
- What is your expected revenue next year?
You shouldn’t be intimidated by these questions, just answer them honestly. However, before you make your phone call to the reconsideration line, make sure you’re prepared with answers to these questions.
Even if you’re a bit nervous when making the call (which is totally understandable), it’s important to know this information about your business. If you don’t know the answers to these questions, it could come off as irresponsible, and no bank wants to extend credit to an irresponsible business owner.
Additional Benefits of a Business Credit Card
Putting tangible benefits aside (e.g. welcome bonuses, spending bonuses, etc.), business cards are great because they make it easy to keep business expenses separate from personal ones, and they can give your business the spending power it needs to grow.
Plus, it’s important to understand that the new line of credit you’ll be opening remains separate from your personal one. So you won’t be hurting your personal credit score if your utilization ratio increases.
The best part for all of the travel hackers out there? Chase doesn’t add business cards towards your 5/24 count. However, if you are already over 5/24, you can’t get approved for this card.
Top Business Credit Cards
Hopefully, by now you’re ready to apply for your first business card. Now the question becomes which card is best for you? Our goal is to make this decision as easy as possible for you! Each month we round up the top 10 business credit cards that will help you travel more in a post called:
If you read through this post, and you still need help choosing a card, we’d be more than happy to recommend a card (or two) for you! All you need to do is fill out this form.