If you’re a small business owner looking to build your business credit, you may be considering an EIN credit card, also known as an employer identification number credit card. These cards can be a great financing option for businesses. But it’s important to understand the differences between them and traditional personal credit cards.
One key difference is that EIN credit cards may require a personal guarantee. Meaning that you are personally responsible for repaying any charges made on the card. This is in contrast to traditional business credit cards, which are issued to the business and the business is liable for any charges.
Another essential factor to consider is that EIN credit cards can be a helpful tool for building your business credit, as long as you use them responsibly. By making timely payments and keeping your balance low. You can improve your business credit score and increase your chances of qualifying for a business loan in the future.
It’s worth noting that EIN credit cards are not linked to your personal credit score or social security number. So they do not affect your personal credit. However, if you are a small business owner with an Individual Taxpayer Identification Number (ITIN) instead of an EIN. You may still be able to qualify for a business credit card.
When considering an EIN credit card, it’s significant to compare offers and understand the fees and interest rates before applying. You should also be aware of any limitations on how the card can be used, as some EIN credit cards are only accepted by certain merchants or can only be used for cash advances.
What Are EIN-Only Credit Cards?
These cards only offer a cash advance. They are perfect for those who want to add a little extra money to their paycheck without needing to maintain a large revolving balance on a card. This card type is ideal for people with lower incomes, small business owners, and freelancers.
Types of Business Credit Cards with EIN
Business credit cards with EIN come in a variety of types. Each type comes with its own benefits, but there are some standard features on all the ones you should consider getting. Read below to figure out the main types of credit cards that you can get.
Corporate Business Cards
Corporate credit cards are swimming around the firm liability. While the big firms may have their own cards, smaller organizations often don’t have such luxury, and in turn, they need to adopt one of these two options. Fortunately, an individual is not responsible to pay back the credit.
Additionally, corporate business credit cards provide the inside financial team with a detailed look at all spending and other analytics to ensure money is being spent wisely.
The application process for corporate cards is more rigorous. A few types of businesses are usually eligible, and you may need to earn a certain profit margin every year. It is common for issuers to extend business credit simply based on a company’s EIN, but only U.S.-registered C-corporations, S-corporations, LLCs, and LLPs are eligible. Choosing the right corporate card for your business might be a bit more challenging for a sole proprietor.
Corporate Gas Cards
Gas cards for corporations are flat-rate cards. In addition to covering fuel costs, corporate gas cards cover employee travel (including airline tickets!) As with regular corporate credit cards, approval requires good business credit. Nonetheless, you can’t use them for just any business purchase. A corporate gas card is specifically used for fuel purchases at the pump and sometimes for vehicle maintenance.
We provide an executive gas card that gives you full coverage for gas and tolls for your business or fleet. No more calling around for rates! Our Corporate Gas Card is fully flexible, so you can use it on any tank of gas or fill it up wherever and whenever you need to.
Corporate Store Credit Cards
Corporate Store Credit Cards are designed to meet the credit card needs of small and large businesses with varying types of customers. They are offered several payment options, including Visa, MasterCard, and Discover. A corporate store credit card reduces your company’s risk by enabling you to offer convenient rewards programs, redemption discounts, and other perks to your customers.
Moreover, corporate credit cards offer an even better way to reward your employees. They let you reward them with points they can redeem on future purchases or redeem them at a discount later on. This can be especially handy for bonuses or incentives around the time of year when you have volunteers coming in from different parts of the country to help with the holiday rush.
Prepaid Business Credit Cards
Prepaid cards are ideal for small business owners who want to start a credit line. You’ll get cash back and balance transfers when you use your card, making it easy to rebuild your credit after making payments on time. No fixed APR can change over time, so you know exactly what your rate will be each month. But even with all its benefits, the perks are available only to business owners. It’s important to remember that prepaid cards are not for those looking for easy access to their funds. The best way to choose a prepaid card is to determine if its annual fee is in line with your needs, as well as its other fees, such as monthly fees and late fees.
The Real Benefits of EIN-Only Credit Cards
Apply with a Low Credit Score
Although, having a high credit score is always recommended. Plenty of people are accepted into the EIN-only credit card because they either can’t get approved for a regular credit card or their current banks aren’t willing to give them one. So it’s unnecessary to have an excellent credit score to apply for something like this.
Separate Business Finance
While business credit cards can be a great way to get access to credit and fund your business, they are not without complications. Mixing personal and business finances, co-signing or guarantying a loan, and having multiple cards open at the same time… are just some of the obstacles that come up when using business credit. Moreover, the biggest benefit of business credit is that it allows you to keep your personal and business finances separate. You won’t have to mix personal and business expenses or bank accounts, reducing the potential for tax fraud, identity theft, and other problems that can arise from mixing personal and business finances.
What is SSN, and How Does It Affect EIN-Only Credit Cards?
SSN is a unique number assigned to an individual. It determines your credit card issuing bank and can be used only for credit cards. Some banks require SSNs when applying for a new credit card; others do not, so it’s best to check with the bank of your choice to see if they require an ssn!
Without an SSN, you are unlikely to qualify for a business credit card. If your business cannot pay off the debt, you become personally responsible for it. Small business credit cards require personal guarantees. This is why credit card issuers often check your personal credit before granting you a business credit card, and they need your Social Security number to do so.
Pros and Cons of EIN-Only Credit Cards
Pros
-
No Personal Liability
EIN-only credit cards are designed to provide you with the peace of mind that comes from knowing there are no financial obligations on your part. If you have a problem with your EIN card, you have nothing to worry about.
-
No Negative Impact on Personal Credit Score
EIN-only credit cards offer No negative effects on personal credit scores. This may provide an opportunity to build up your credit with EIN–only credit accounts, so you may be eligible for EINs later if you require one. This can sometimes help when a creditor gives you a loan that ties your traditional score to their internal scoring system, where they do not consider your EIN. The underlying philosophy of using QCCs is to focus on the good economic picture that is reflected in the combined EIN/QCC combination and minimize the impact of any large negatives on your credit score caused by extended utilization.
-
No Hard Checks on Personal Credit Reports
EIN-only credit cards offer No hard checks on the personal credit report. So you can open them with no stress and use them immediately. All your payments can be online. We don’t collect any hard documents or do not need to submit them to credit reporting agencies.
Cons
-
Strict Requirements for Approval
Strict requirements exist for EIN-only credit cards to be approved. They are not open to everyone, nor do they just work like any other credit card. Before submitting an application to the bank, getting a second opinion is always a good idea.
-
No Positive Impact on Credit Score
EIN-only credit cards offer No positive effects on personal credit scores and have no relationship to rewards.
-
Minimum Lenders
Credit cards of this type are not available at all lending institutions and banks, so applying for them is a bit difficult.
In Conclusion
Overall, EIN credit cards can be a useful financing option for small business owners, but it’s important to carefully consider your business’s financial needs and compare your options before applying. Don’t forget to also explore other financing options, such as business loans, to find the best solution for your business.
Business credit card stacking with BitX Funding refers to the practice of opening multiple business credit cards with 0% introductory interest rates and using them to finance a startup business or working capital.
Issuance of EIN-only credit cards from BitX Funding is much more reliable and easy. Because our policies are not as tough as others. Not only this, we give you a chance to get your application approved within 3 days and do not ask for a huge amount of money to obtain an EIN card. Therefore, visit our website today, apply for a business credit card, and let the game begins.
