Corporate Credit Cards: How They Work, and Differences vs. Business Cards

Corporate cards are less risky for individual cardholders, since responsibility for debt is tied to the company the card is issued to (and possibly employee cardholders who make unauthorized purchases) — not any one individual.

That said, you should only get a corporate credit card if you are a major corporation who can easily meet the eligibility requirements for a corporate card. All other business owners should opt for a business credit card, which is largely the same, but requires a personal guarantee.

Corporate credit cards vs. business credit cards

What are corporate credit cards and how do they work?

Corporate credit cards are designed for companies with numerous employees and enormous annual revenue, usually requiring a minimum of $4 million. These cards anticipate a high number of authorized users and don't require a personal guarantee, meaning that if the company goes under, no single individual is responsible for debt accrued; instead, it's on the business itself.

Stricter eligibility requirements

For example, corporate credit cards can only be acquired by S-Corporations, C-corporations and LLCs with a pre-established business credit score. You'll also typically need to have a certain amount of employees, and a high annual revenue, as we mentioned previously.

Analytics tools

Corporate credit cards are often equipped with powerful analytics tools that allow company accountants and managers to keep a better grasp of where money is being spent. Banks such as Capital One or American Express allow their business clients to set up different tracking options — whether it be by department or different vendors. Having this level of control is also important when it comes to reconciliation and reimbursement.

Because corporate credit cards are often issued to a large number of employees, keeping track of the different spending can become difficult. As your company grows and expands, corporate credit cards are designed to scale with it, making sure your company doesn't lose any control of its expenditures.

Rewards geared for large corporations

Much like with business credit cards, corporate credit cards often earn rebates and rewards on their spending, in the form of cash back, points or miles, and can come with perks like airport lounge access, Global Entry and TSA Precheck credits and more.

These rewards, however, are typically credited back to the main company account. Most issuers also offer non-rewards options, specifically meant for large companies and nonprofits (with revenue of more than $10 million) that have internal corporate policies preventing them from taking in this kind of revenue or price reduction benefits.

What are business credit cards and how do they work?

Business credit cards allow small business owners and their authorized users to charge all their business expenses to a business account. The primary difference between business credit cards and corporate credit cards is that business credit cards typically require a personal guarantee, meaning the business owner is personally responsible for all expenses charged to their card.

The most rewarding "]business credit cards offer rewards and benefits to their cardholders, much like personal credit cards. However, business credit card rewards tend to be more lucrative and credit limits are typically higher than personal credit cards because businesses generally spend more. Many business credit cards offer valuable business perks like free employee cards, for which you can set spending limits and earn rewards on card spending. You may also receive access to helpful accounting tools and resources that will help you stay on top of your financials.

While corporate credit cards have strict eligibility rules, business credit cards are available for any type of business, including:

In order to be approved for a business credit card, you'll typically have to undergo a credit check and proof of business ownership.

What are the best business credit cards?

There are numerous business credit cards available for small business owners. The "]best small business cards will provide strong rewards and business perks that can be valuable for your company.

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