| 5 min read

Best Business Credit Cards for Bad Credit

Starting a company can be a risky business.  Especially when it comes to finances.  Few owners start out with a big pile of cash or major venture capital funding.  Most will face a broad range of challenges that can tank their credit score and put a severe pinch on a company’s ability to grow -- or even survive.

Issues that can crater your company’s credit

  • Limited or Inconsistent Cash Flow

You’re making sales, but not enough to cover all your expenses or you’re crushing it in Q4 but the rest of the year, sales are flat.  In the meantime, the bills keep coming in.

  • Not Using a Budget

It’s easy to get in financial trouble fast if you don’t know what your expenses are.  Figuring out upfront what you expect to have to spend to keep the lights on every month is essential.

  • No Preparation for Unforeseen Expenses

Everything is going along fine and then your laptop dies. The furnace in your workshop blows up. Or the cost of energy drinks to stock your cool company kitchen suddenly skyrockets. If you don’t have at least a small cash cushion set aside, you could be in instant trouble if something happens.

  • Not Raising Enough Capital

While it’s tempting just to dive in on a venture without raising much money, it isn’t wise.  If you have cash upfront to pay for things like office equipment, furniture, and initial inventory, you won’t have to take the risk of financing the cost.

  • Too Much Debt

See “not raising enough capital” above.  Taking out loans to start your business immediately puts you in the hole. Carrying a lot of debt once you’re established eats into your profits and can prevent you from scaling.

  • Neglecting Necessary Reporting

Like not having a budget, to begin with, not tracking sales, cost of goods, and expenses can lead you into a blind alley of financial woes.

  • Poor Tax Compliance

Neglecting to charge sales tax, miscalculating quarterly estimated taxes, or failing to file on time can financially catch up to you in very damaging ways.  And while you can sometimes put off creditors, you can’t put off the government.

  • Not Paying Bills on Time

Whether you’re delaying because you’re waiting for an invoice to be paid to have the cash to pay on time, or you’re just not on top of your accounts payable schedule, late or missed payments can trigger extra charges and damage your credit score.

2021 Recommendations for the Best Business Credit Cards for Bad Credit

So you’ve gotten yourself in a financial jam and your credit score is in the toilet -- below 640. If you’re not planning to close up shop and quit, you’re going to need some kind of financial instrument to help you get back on track.

Business credit cards for bad credit are credit cards designed for small business owners who personally have bad credit.  Unfortunately, right now, there are very few business cards available to new applicants.

The good news is that there are personal credit cards for business owners with bad credit that WalletHub has selected from among  1,500+ business and consumer credit card offers because of their reasonable approval requirements and solid terms.

Secured?  Or Unsecured?

When it comes to credit cards, there are two main types: secured and unsecured. Secured credit cards can be great for business owners with bad personal credit as they give you control over your limit while also being low-cost when compared to most other options out there.

In addition, unlike an unsecured card where the bank takes on all responsibility in case of a purchase not made from money that belongs to you or someone else who is responsible for repaying debts incurred by those purchases, even if this happens with cash advances using a secured card – which typically means borrowing against your own equity -you will still have some protection because these loans come at high-interest rates.

Secured credit cards also report information to the major credit bureaus like Experian, Equifax, and TransUnion each month. So on-time payments will help you build the kind of credit needed to qualify for a really good business credit card down the road

What Is a Secured Business Credit Card?

Secured credit cards are designed for people who have a bad credit score or who don’t have a very long credit history. For many companies, credit cards of any kind are an essential part of their business activities.  They can help you build your credit scores and credit history, and they can help you access the money you need to run - and grow your business. 

A secured credit card is a lot like a regular credit card with one difference.  It requires you to make a  payment of a refundable deposit to open your account. In most cases, the amount of your deposit will be equal to the credit limit you’ll have on the card. 

The security deposit will let lenders know that, despite your lack of good credit, they will have no exposure if you don’t pay your bills.  But if you manage the card properly and pay for your charges, you can receive the security deposit back.

The issuer will likely make you link your bank checking or savings account.  That way the initial deposit can be deducted directly.  However, a few card issuers will let you send the money to them after you’re approved for the card.

The good news is that just like a regular credit card, make purchases and charges with a secured credit card. But be aware, just like with unsecured credit cards the major credit bureaus will get reports on your payment history.  So making on-time payments and carrying very little, if any debt will help with your credit score.  If you are conscientious about paying on time, after a year you may be able to get approved for a regular unsecured card. 

The Pluses and Minuses of a Secured Business Credit Card

Just like with any financial tool, there are both pros and cons to take into consideration with a secured business credit card.


  • A great way to build or rebuild your personal or business credit.

  • If you pay on time you can move up to an unsecured business credit card.

  • Your bad credit score won’t keep you from qualifying.


  • Your interest will probably be very high.

  • Your credit limit will be low at first.

  • You run the risk of maxing out the card because of your low credit limit. 

How to Choose the Right Secured Business Credit Card 

In order to identify the right secured business credit card, you should do a number of things. First, take a look at the card's benefits, fees, and rewards.

Then check out the minimum and maximum security deposits they require. Ideally, it should be an amount you can afford, but still generous enough to allow you to buy the things you need.

You should also consider the interest rate and fees you’ll have to pay. Some secured cards have no annual fee,  Others charge relatively low fees. It’s not common, but some cards offer rewards like cash back, which can help offset the costs of the card.

The Best Secured Business Credit Cards

Your choices on this are not going to be as expansive as they would be if you were shopping for an unsecured business credit card.   With that in mind, the best place to start to decide what type of business financing tool would be right for you is to get a hold of your free personal and business credit scores to see what you can qualify for.

You can use a service like Nav to not only see each credit score for both personal and business, you can also identify which small business credit cards and loans you might be eligible for.  Here are Nav’s picks for the Best Secured Credit Cards as of February 2022.

Wells Fargo Business Secured Credit Card

This secured business credit card charges no annual fee and gives you 1.5% cash back reward on every $1 you spend. If you qualify, you can enjoy a credit line of $500 to $25,000. As a bonus, there are no foreign transaction fees. 

First National Bank Business Edition® Secured Visa® Card

This is a business secured card that has a credit limit of between $2,000 and $100,000, which goes up in multiples of $50. They require a security deposit that is  110% of the credit limit that you request.  The good news is that you’lll earn interest on the deposit. The bad news is that there is an annual fee of $39.

Union Bank® Business Secured Visa® Credit Card

This is a secured card for small business owners that has a limit that’s as low as $500 and as high as $25,000. It charges a low APR of just 13.99%. Variable. However, they charge a $30 annual fee.

The Best Personal Secured Credit Cards

If your low credit score is making it hard to qualify for a business credit card you have another option.  You may want to consider getting a personal secured credit card. A personal secured card will help you build your credit history and as long as you pay on time, boost your credit score.

Citi® Secured Mastercard®

Unlike a debit card, this card helps you build your credit history with monthly reporting to all three major credit bureaus. Minimums are low. You can open an account with a deposit of as little as $200 or as much as $2,500.  This deposit equals the amount of your credit line. You’ll pay a standard APR of 22.74% (Variable) with no annual fee. As a bonus, it also gives you a free monthly FICO score.

Platinum Secured from Capital One®

This card comes to you with no annual fee and a starting credit line of $200. But be aware your refundable deposit can be $49, $99, or $200, depending on your creditworthiness. On the plus side, it also offers automatic credit line reviews. That means you could be eligible for a higher credit line within six months. Another good thing is that there are no transaction fees.

Lots of businesses struggle with bad credit.  But having bad credit now doesn’t mean your business won’t succeed in the future.  The responsible use of a secured business or personal card can help you build your credit back up in less time than you think.  The sooner you start, the faster you’ll get back to where you want to be.

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