Yes, acquiring startup business credit cards with no personal credit checks is absolutely a thing. However, there are a few hoops through which a budding entrepreneur must jump through to accomplish this feat.
Here are some options to consider in order to make it happen for your business.
Find a Credit Partner
Working with someone who has an established credit history can be a good approach to this concern. Maybe your business partner is in better shape credit-wise. Sharing a card for which that person can qualify is a good way to get credit cards for your new businesses without creditors checking your personal credit history. Your partner applies for the card and adds you as an authorized user in this scenario.
The benefits of this approach include:
• Getting the card you need to conduct business transactions
• Personal credit score will benefit
• You may get more favorable credit terms
The downsides include:
• You could lose the card if your partner leaves the business.
• Both of you will be responsible for debts incurred, regardless of who made them.
• You may have to answer to the primary cardholder for purchases.
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Have Payments Recorded by Credit Bureaus
Every business has certain fixed expenses, such as rent if you’re in a facility you don’t own. Getting the property owner to register with RentTrack will have your rent payment reported to Equifax, Experian, and TransUnion.
The benefit of this approach:
The opportunity to build a positive credit history for your business, assuming you always pay your rent on time — of course
The downside of this approach:
The time required to establish history to qualify your business for a credit card
Get a Secured Credit Card
Limited only by the amount you’re willing to place as a deposit, a secured credit card is backed by the money you provide the card issuer as collateral. The financial institution will then have the right to use those funds to satisfy any outstanding balances should you fail to meet the stipulations of the cardholder agreement. The deposit will be returned after a prescribed period of time, as long as the account is maintained in good standing.
Otherwise, a secured credit card functions just like any other card. You can make purchases up to the card’s limit, which is governed by the amount of your deposit. Your activity with this card will be reported to the credit bureaus, which can help your fledgling enterprise develop a credit history.
The benefits of this approach include:
• The opportunity to build a credit history
• Security deposit is returned after a certain amount of time
• Potential to earn points toward rewards
• Ease of approval
The downsides include:
• Spending is limited by the size of your deposit
• Some secured cards impose maintenance fees and annual fees
• Interest rate is likely to be high
In Summary
You can get business credit cards without a personal credit check by using one of the approaches above. As noted, each strategy has its pros and cons, so you’ll need to decide which tactic is most conducive to setting your company up for success.
