Business credit cards

A business credit card works just like a personal credit card – it’s a simple way of gaining access to working capital, improving cash flow during slower periods, or helping build a credit score for future loans.

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In similar way to a personal credit card, a business credit card is often the first lending product a business might use. Lenders often want to see some form of credit history when lending larger amounts, so a business credit card might be an easy way to prove your reliably as a borrower. It can also be a handy tool in covering short term unexpected costs when you know you have the money coming in within the repayment period receiving money through the repayment period. If you are looking for a better way to manage your business spending and to boost your company’s credit profile.

Business credit cards available through Swoop:

Capital on Tap business credit card example

Capital on Tap

  • Credit facility of up to £100,000
  • Up to 56 days interest free on card purchases
  • No FX or UK ATM charges
  • UP to 10 free suppements cards

What is a business credit card?

How does it work?

Charge Cards

Which one shall I choose?

Why choose a business credit card?

Quick facts about business credit cards

Is it suitable for SMEs?

Pros and cons of a business credit cards

Have you also considered?

What is a business credit card?

Business credit cards, also known as corporate credit cards, work in the same way as supplemental personal credit cards. They come with a set credit limit and you can roll over your balance from month to month, though your spending will accrue interest, based on the APR for which you qualified.

A business credit card is a simple way of gaining access to working capital, allowing you to improve your company’s cash flow during slower periods or free up cash to fund the expansion of your business.

Most business credit cards have an interest-free period of up to three months; any money borrowed that is paid off before this point does not accrue interest, making this an inexpensive option if you’re able to reliably pay off your debts. Your credit limit is applied on a rolling basis, so once any debt has been paid, you can begin loaning up to the credit limit again.

How does it work?

A business credit cards works like a personal credit card, the difference is that the credit is in the name of the business. Funding through a business credit card is a unsecured loan, and can be seen as an emergency lending if you are not eligible for other funding types or you need to improve your company’s cash flow during slow periods.

Business charge cards explained

If you are at a very early stage and have limited credit history, some business credit card companies may encourage you to start with a business charge card. This is done to prove your creditworthiness. With some smart money management and prompt repayments, you will build your credit history and be ready for a credit card in no time.

So how do they work? a business charge card lets you make purchases without debiting the money directly from your business bank account. It has no pre-set spending limit, but the full statement balance must be paid back in full every month. With this, you can over time show that your business has a good payment history and build your credit score. This also marks one of the key differences between the two types of cards – with a business credit card you can pay your balance over time and not have it due by the end of the billing period.

Which business credit card is right for my business?

When you have decided that a business credit card is right for you, the next decision is which provider to use. Which one will work best for you and your business is individual since different providers offer different rewards with, so you need to think about what you need from your business credit card.

  • One with low APR or an interest free period – if you know you will need it to borrow money through it;
  • Cards for several employees – make sure the provider is offering multiple cards per account;
  • Great discounts or benefits – some offers cashback, discounts on certain stores, reward points or a whole other benefit that suits you;
  • Travel benefits – does you employers need to make foreign transactions or maybe you need travel insurance as one of your perks some providers offers that;
  • Do employees need to make overseas trips? Some cards offer favourable exchange rates and include travel insurance;

Why choose a business credit card?

Perhaps you’re a small business owner who’s found it difficult to get a traditional business loan. You can of course hit up your network of deep-pocketed friends… but if they aren’t forthcoming, a business credit card can be a good option. Like a revolving credit line, a business credit card can be your emergency lending, up to a limit. This limit will depend on the your credit rating, trading history, turnover and profit.

A business credit card is a useful way to manage cash flow when you don’t have enough working capital. It’s also useful for keeping track of the expenses your staff might incur (several cards can be used on the same account though the credit limit will remain the same).

Once you’ve set up your credit card, you can improve your business credit rating by observing the credit limit and paying back the balance each month and on time.

Otherwise you can roll over your balance from month to month, paying only the minimum amount required (if there is a minimum), and accruing interest based on the effective APR for which you qualified.

Quick facts about business credit cards









APR and monthly fee



Same day if you are already a customer


Short-term working capital, to help you manage cash flow

Suitable for

Suitable for

All businesses

Are they suitable for smaller businesses?

If you run a small company, a business credit card is a simple and flexible way of managing your expenses and ensuring you always have access to working capital.

However, the relatively low credit limits and high interest payments mean that other financing options may be more attractive. Merchant cash advances, for example, offer lump sums repayable via a percentage of your card takings – so if your takings drop, your repayment rate will drop too, ensuring repayments don’t eat into your profits.

Pros and cons of a business credit card

Unlike business loans or credit lines, application for a business credit card is fairly simple – if you have a good credit history and you have established a successful business, you should not find it difficult to qualify. This is of particular benefit to smaller businesses, as they are more likely to experience cash flow issues, and a business credit card offers instant access to extra funds that can be used to purchase stock or equipment, ensuring your business remains profitable.

An additional benefit of a business credit card is that it allows you to build up your business credit – if a lender sees that you reliably pay off your business credit card, they will be more inclined to approve you for a bank loan or an increased credit limit in the future. Some lenders even offer perks such as air miles and cashback offers and, because business credit cards are unsecured, there is no risk to your home in the event that you are unable to pay back your debts.

As with all financing options, it is important to be aware of the potential drawbacks. Interest rates on business credit cards tend to be higher than other forms of working capital finance and, along with the annual fee for owning the credit card and fees for late repayments, can prove an expensive option.

The amount you can borrow via a business credit card is also likely to be lower than other financing options, so if you require a lump sum to cover a one-off payment or investment, you may wish to consider other working capital finance possibilities.

What other business finance options do I have?

You might also want to consider other types of working capital finance.

Within these different types of business loan – of course there is some overlap between them – you’ll find some that better suit your particular situation, e.g. you might be looking for start-up finance, equipment finance or working capital finance.

Depending on how long you think you’d take to repay the loan you can consider:

  • business overdraft
  • short-term or medium-term business loan (i.e. working capital loan)
  • short-term business loans – usually between 3 and 18 months (often referred to as working capital loans)
  • ‘term’ loans – usually between two and five years (‘term’ means medium- or long-term)
  • very short-term loans – including revolving credit facilities and other business overdraft alternatives.
  • long-term loans – these can run from three to 30 years, require monthly or quarterly payments from cash flow or profit, might restrict other financial commitments (e.g. debts, dividends or principals’ salaries), and can require an amount of profit set aside for loan repayment.
  • balloon loans – relatively small monthly payments, ending with final ‘balloon’ payment to pay off the remaining loan balance.

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