Should I get a business credit card?
FLD is not a lender or a credit broker and does not arrange credit. This is general information, not advice to borrow. Any representative APR shown is an example, not a personal quote: the rate you are offered depends on your circumstances and may be higher.
Important: This guide provides general information, not personalised financial advice. Financial products, rates and eligibility rules can change, so check the provider’s current terms before applying. You can check a firm’s details on the FCA Register.
Quick answer
A business credit card can help if you’ll clear it in full each month: you get up to 42–56 days interest-free on many cards, separate business spending, employee cards and sometimes cashback. It’s a poor fit if you expect to carry a balance — the interest usually costs more than any reward.
Our pick for a limited company that clears its balance monthly: a no-fee cashback card such as Capital on Tap. Our pick for a business that wants to pay in full every month by design: a charge card such as American Express Basic Business Card (no annual fee).
Card versus the alternatives
| Option | Good for | Watch out for |
|---|---|---|
| Business credit card | Short-term spending cleared within the interest-free period; employee cards; rewards | Interest if not cleared; fees; personal guarantees |
| Charge card | Spending you’ll always pay in full; no ongoing interest | Must be paid in full each month; generally outside Section 75 |
| Business debit card | Day-to-day spending from money you already have | No interest-free period; no credit |
| Overdraft | Short gaps in cashflow | Arrangement fees and interest; can be withdrawn |
| Business loan | Larger, planned costs repaid over time | Fixed repayments; may need security or guarantees |
General guide only. Provider details on linked pages are as of 3 October 2026.
Who it’s for
- Businesses with regular costs that can be cleared monthly
- Companies needing employee cards with limits
- Owners who want business spending separate and easy to reconcile
- Businesses buying online or abroad where a card is easier
Who should skip it
These are general points to weigh up, not advice. You may want to look elsewhere if:
- Cashflow is tight and you’d likely carry a balance
- You can’t give a personal guarantee if asked
- Your spending is small and a debit card does the job
- You’re already struggling with debt — speak to a free debt adviser
Full explanation
Three questions to ask
Will you clear the balance every month? Would the interest-free period genuinely help cashflow?
Do the rewards or controls outweigh any fee? If the answer to the first is “not always”, look hard at the interest rate — see Business credit card APR and fee comparison.
Who can apply
Some cards are company-only (Capital on Tap), and some need you to hold the issuer’s business account (NatWest). Check Business credit card eligibility before applying, because several hard searches close together can affect your credit file.
Using a card well
Set up a Direct Debit for the full balance, give staff cards with limits, and link the card to your accounting software if you can. Read The catch with business credit cards before you sign.
More: business credit cards explained and Business credit card FAQs.
The catch
Interest is expensive. Barclaycard’s own example: £1,200 repaid over 12 months at 25.5% APR costs £148.90 in interest.
You may be personally on the hook. Sole traders are personally liable; company cards often need a personal guarantee.
Protection is thinner than on personal cards. Section 75 of the Consumer Credit Act often doesn’t apply to business cards, especially for limited companies. Sole traders and small partnerships may be covered on a regulated card, for single items priced between £100 and £30,000.
Thinking yes? Compare the options:
FAQs
Is a business credit card a good idea for a small business?
It can be if you clear the balance monthly. If you’d carry a balance, the interest usually outweighs the benefits.
How long is the interest-free period?
It varies — up to 56 days on NatWest’s card and up to 42 days on Capital on Tap, if you pay in full and on time.
Will a business card affect my personal credit?
It can, especially for sole traders and directors giving a personal guarantee.
Is a charge card better than a credit card?
A charge card forces you to pay in full monthly, which avoids interest but gives no flexibility. It generally falls outside Section 75.
Can I get a business card as a new business?
Sometimes. Capital on Tap says active companies of any age can apply.
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