What’s the Difference between a Business Credit Card and Personal Credit Card?

Everything you need to know to pick the right credit card for your small business's financing needs.

We are committed to sharing unbiased reviews. Some of the links on our site are from our partners who compensate us. Read our editorial guidelines and advertising disclosure.

Credit cards are a top form of financing for most businesses—whether you’re looking for more startup capital or a simple way for employees to charge their office supply runs.

But business credit cards differ from personal credit cards in a few key ways. Not only do credit card companies offer different perks and rewards on business cards, but they also offer different protections to the cardholder. Your spending is also much more closely tracked on a business credit card, and it can affect your credit score differently.

So what are the exact differences between a business credit card and a personal credit card? Here’s what you need to know before you get started.

Find your next business credit card with Nav's marketplace
Get the working capital you need using Nav's easy-to-navigate credit card marketplace.

Pros and cons of business and personal credit cards

Business credit cards

Business credit cards often feature higher credit limits than personal cards, so they’re a decent financing solution for small-business owners who don’t have the credit history to secure a loan. And because most card issuers understand how seasonal fluctuation can affect business revenue, many business card companies offer flexible repayment terms and bonuses for cardholders who pay their bills early.

Rewards programs on small-business cards also cater to business needs, so businesses are more likely to get rewards for office supply charges and shipping expenses than they would on a personal card. Plus, the payouts on business rewards programs tend to be more lucrative.

The downside is business credit cards are less regulated than personal cards, which means legally, your credit card company could double your annual percentage rate (APR) overnight without notice. Less regulation also allows credit card companies to charge higher fees.

pro Business credit growth
pro Tailored payment terms
pro Easier tax prep
pro Bigger category bonuses
con Fewer protections for borrowers
con Stricter application limits
con No effect on personal credit
con Personal liability if your business fails

Personal credit cards

Personal credit cards, on the other hand, are pretty heavily regulated, which gives cardholders a lot of protections. For instance, credit card issuers can’t revoke your introductory APR offer or start charging new transaction fees without giving you 45 days notice.1 They’re also limited in terms of how much they can charge for late fees, over-the-limit fees, and penalty fees.

That makes personal cards a bit safer for small-business owners, but it doesn’t really outweigh the drawbacks of using personal cards for business use.

Personal cards tend to have lower credit limits than small-business cards, so they cap your spending power. Rewards on personal cards don’t really compare to bonuses on business credit cards either. And using a personal card for business expenses can be a nightmare come tax season when you have to parse through every single transaction to figure out which charges were business purchases and which were personal expenses.

pro Looser application limits
pro More protections for borrowers
pro Personal credit score growth
con Stricter personal credit requirements
con Less valuable rewards payouts
con No effect on your business credit score
Small Business Loan Requirements Checklist
Applying for a small-business loan soon?
Our free checklist can help you understand what lenders are looking for.

By signing up I agree to the Terms of Use.


So let’s talk about using personal credit cards for business expenses.

Businesses tend to spend and make more money than individuals, so credit card companies tend to offer higher credit limits on business cards than on personal cards. Translation: if you’re hoping to use your credit card as a means to get startup capital, a personal card may not cut it.

But let’s face it; not every business needs thousands of dollars in spending money. If you’re planning to use your card for small transactions only, a personal credit card may be completely adequate.

That being said, we’d strongly advise against using a personal card if you’re planning to authorize other employee cards on your account. Personal credit cards are reported to the credit agencies under your name, so if an employee uses the card to charge thousands in personal transactions, you’re still individually liable for that debt.

Limitations on business credit card spending
FYI: business credit cards cannot be used to pay your property lease, payroll, and certain types of invoices. So if you’re planning to use your business credit card to get your company up and running, you’ll need to find other financing for those expenses.


So how do credit scores work with business and personal credit cards?

Well, when you apply for a personal credit card, you don’t need to have a minimum income to get approved. But the credit card company does a hard check on your personal credit score (which is influenced by anything from your debt repayment history to whether you carry a balance on your existing credit cards). Your credit score is the main thing credit card companies use to determine your eligibility and the interest rates you qualify for.

With a business credit card, the card issuer does a hard check on both your business credit score and your personal credit score. So if your business has bad credit or no credit, your personal credit score affects your eligibility for certain cards (not to mention loans).

If your business has bad credit or no credit, your personal credit score affects your eligibility for certain cards.

Once you’ve been approved, personal credit cards report everything to personal credit bureaus. That means you get rewarded for both good credit behavior (like paying more than the minimum amount due) and bad credit behavior (like missing payments). Business credit cards, however, report to business credit bureaus, so your business gets all the credit when you manage your account well. Granted, there are a couple of card issuers that report positive behavior to personal credit bureaus. But they tend to be the exception rather than the rule.

Most credit card companies make you sign a personal guarantee when you sign up, which means you’re personally liable for the debt on your business card if your company fails. So negative reporting on your business card does affect your personal credit report.

Now, there are some business credit cards that don’t report to personal credit bureaus at all. Unfortunately, these corporate credit cards are available only to companies that make over $1 million in revenue per year. So unless you’re on the ball with your business card payments, your credit score will likely take a hit.

You should also keep in mind that many website builders offer free hosting as part of your plan. But in general, we advise against hosting your site with your website builder. Website builders tend to focus more on offering a quality builder than on delivering the best uptime rates and page load speeds, so your customers will likely have a better experience if you pay for your web hosting and website builder separately.

Credit effects of business credit cards vs. personal credit cards

Business credit cards
Personal credit cards

Runs hard check on business credit



Runs hard check on personal credit



Reports to business credit bureaus



Reports to personal credit bureaus

Varies by card issuer


Don't qualify for a business loan due to your credit score? Get a personal loan instead.
Got a low personal credit score?

Don’t despair! Some business credit cards cater to bad-credit applicants. For starters, you could sign up for a secured credit card (like the Wells Fargo Business Secured Credit Card), which gives you business card privileges after you pay an up-front security deposit. Or you could opt for a charge card, which requires you to pay off your balance in full each month. Either option is a great way to build your business credit and get the funding you need.


Both personal and business cards offer rewards programs, but there are some differences you should know.

Rewards programs on both business and personal cards allow you to earn rewards points (which can be redeemed for airline miles, travel perks, cash, and statement credits), but each card varies when it comes to spending categories, bonus offers, and rewards.

In general, though, business credit cards tend to offer bigger payouts for cardholders—but you have to spend more to get them.

Just take these two Chase Ultimate Rewards cards as an example: With Chase Sapphire Preferred (a personal card), you get 60,000 membership rewards points after you spend $4,000 within the first three months. But with the Ink Business Preferred Credit Card (a business card), you get 80,000 rewards points on the first $5,000 you spend within the first three months.

So if you’re all about maxing out your rewards and know you’re going to be using your credit card a lot, a business credit card might be the best way to go.


With any type of credit card, you’ll have to deal with interest rates and fees. And naturally, those rates and fees vary depending on the card you use.

Pretty much every credit card will charge you over-limit fees if you charge more to your card than your credit limit allows. In addition, many credit cards charge transaction fees, annual fees, and foreign transaction fees—though some card issuers opt to waive these fees as a perk.

Most business credit cards feature lower APR offers, but legally, they can change their rates and fees overnight—with no notice.

Whether you use a personal credit card or a business credit card or a personal credit card, it usually pays to scope out the best credit card offers for your needs before you apply. For instance, if you work with a lot of overseas clients, you may want to rule out credit cards that charge extra for foreign transactions.

You’ll also have to think about which cards offer the best annual percentage rate (APR). In general, business credit cardholders are able to get lower APR offers than personal credit card users,2 and business credit cards are more likely to offer low introductory APR when you first open your account.

The downside? Business credit cards aren’t subject to regulation under the Credit Card Act of 2009, so your card issuer can change your APR without notice and charge exorbitant fees. So if the thought of unscheduled rate hikes gives you a panic attack, a personal credit card may be the better option for your business.


Small-business cards offer a lot of perks for business owners, including bigger rewards, higher credit limits, and lower interest rates. However, business cardholders miss out on many of the protections available to personal credit card users.

In the end, though, it comes down to how you intend to use your credit card and what your credit goals are. If you want to build your business credit, a small-business card is definitely the way to go. But if your primary goal is to rebuild your personal credit, we’d recommend sticking with a personal card.

Want to learn more? Check out our step-by-step guide to applying for a business credit card.


At Business.org, our research is meant to offer general product and service recommendations. We don't guarantee that our suggestions will work best for each individual or business, so consider your unique needs when choosing products and services.


  1. Consumer Financial Protection Bureau, “Can my credit card company change the terms of my account?” July 10, 2017. Accessed July 27, 2022.
  2. ValuePenguin, “Average Credit Card Interest Rates (APR).” Accessed July 27, 2022.

FAQs about business and personal credit cards

If you have bad credit, it is still possible to get a business credit card. However, a low personal FICO score may limit the card options available to you. It may also negatively affect your interest rates and the perks available on your card.

If you have bad personal (or business) credit, you may want to consider building your business credit with a business checking account and debit card. Or you can apply for a charge card, which requires cardholders to pay their balance in full at the end of each billing period. Some card issuers also offer secured business credit cards, but you’ll need to pay an up-front security deposit (just in case you miss payments down the road).

If none of those solutions work for your situation, you may want to check out other ways of financing your business with bad credit.​

Business credit cards are great for building your business credit. Your personal credit report? Not so much.

While some credit card companies do report positive activity on your business card to the personal credit bureaus, most don’t. But most business card issuers require you to sign a personal guarantee, which makes you liable if your company defaults on its business card payments. If that happens, the credit card company will report those failures to the personal credit bureaus, and those negative reports will affect your personal score.

In other words, your business gets all the credit when you keep your spending below your credit limit and make payments on time. But if you miss payments, it’ll ding both your business credit score and your personal credit score. Bummer.

Good news: business credit cards are available to anyone who is earning income for their services or goods. So you can qualify for a business card even if you’re a freelancer, an Uber driver, or an Etsy seller—no EIN required.

Just be aware that business credit cards are supposed to be used for business spending only. Businesses that violate this rule may lose access to their business card perks, or the card issuer may decide to close the account. So unless you’re really planning to use your business card for office supply runs and other pertinent business expenses, you may want to use a personal card instead.

A business line of credit is something in between a business loan and a business credit card.

Business lines of credit are like business credit cards in that they allow you to withdraw and repay funds as long as you don’t go over your credit limit. But business lines of credit tend to offer higher credit limits than business cards, and you can use them for working capital expenses like payroll and property leases (which you can’t do with a business card).

The only drawback is most business lines of credit require good credit history, a minimum annual revenue, and at least three months of business history. So small businesses that have been around for less than a year should plan on sticking to small-business cards—at least for the time being.

Learn more about the difference between these types of revolving credit.

Courtenay Stevens
Written by
Courtenay Stevens
Courtenay cut her teeth (and occasionally her tongue) on the world of business when she was eight years old, licking envelopes to help her dad mail calendars to his clients. Ever since, she has fostered a passion for entrepreneurship, which makes small business one of her favorite topics to write about. When Courtenay isn’t writing, she enjoys podcasting about pop culture and attempting to keep up with her hellspawn (aka children).
Recent Articles
Best Fast and Easy Business Loans in 2020
Best Fast and Easy Business Loans in 2023
Get funding for your business today or tomorrow with these fast, simple business lenders. Best...
Lendio, Fundera, and Funding Circle offer some of the best small business loans
Best Small Business Loans
We researched more than 60 online and traditional lenders to come up with our list...
The 5 Best Startup Business Loans of 2023
Business.org reviews Lendio, Bluevine, and other top lenders for startups. Best overall Lendio Borrower requirements:...
Lendio, BlueVine, and Fundbox offer some of the best small business loans for women
10 Best Small-Business Loans for Women in 2023
Female business owners get rejected for loans at higher rates than their male counterparts.1 These...