Business Credit Cards are those that are used towards business expenditure and not for personal use. The Business Credit Cards are specifically designed for entrepreneurs, proprietors and MSMEs to manage business finances more efficiently. These cards help keep company expenses separate, support the building of a business credit profile and may offer higher credit limits to aid business growth. Normally, for small business cards, the liability stays with the user, but in case of a corporate business card, the liability will be either with the individual or company.
What is a Business Credit Card?
A Business Credit Card is a credit facility issued specifically for business-related expenses. It is designed for start-ups, small businesses, and large corporations to manage operational costs such as travel, inventory purchases, marketing, and vendor payments. Unlike a personal Credit Card, a Business Credit Card helps track company expenditures separately and may offer higher credit limits along with tailored rewards. Depending on the card type, liability can rest with the employee, the organisation, or both.
Types of Liability in Business Credit Cards
Individual Liability –
The employee using the card will be held accountable for the expense and in return, should pay the bill when generated. He can raise a reimbursement request with his/her company’s finance team, and he/she will be paid the amount spent. In case of a default, the employee will be questioned.
Corporate Liability –
Employees will spend money from this card and submit the expense to the finance team. The liability, in this case, stays with the organisation, and they are expected to clear dues and pay bills on time.
Joint Liability –
In some cards, the liability is shared both by the employee and the company. These terms are cleared when the card is issued. One should also be clear about the terms in order to avoid any future conflicts.
ICICI Bank Business Credit Card Benefits and Advantages in India
For Business-Specific Benefits
Business Credit Cards have a different set of benefits which are similar yet different to personal Credit Cards. You get rewards when you spend money on advertising through the card, for booking flights and hotels, for shipping and other purchases related to business. A business Credit Card also gets a higher credit limit compared to a personal Credit Card.
Tracking spends is easier
A business Credit Card allows you to bifurcate your expenses into personal and business. Your personal and business expenses remain separate, allowing you to track your expenses easily.
Helps in building business credit
Just like your personal Credit Card, a business Credit Card helps you in building a credit history for your business. This credit history helps you in availing of loans, credit line, leasing and even get insurance policies for your business. However, ensure that your history stays positive as missing or skipping any due will directly impact your business score.
Eligibility Criteria for Business Credit Card
Business Credit Cards are ideal for entrepreneurs, start-up founders, self-employed professionals and established business owners who want to manage company expenses efficiently. While specific criteria may vary, applicants are generally expected to:
- Own or manage a registered business or professional practice in India
- Demonstrate stable business income and financial track record
- Maintain satisfactory credit history
The Bank may also assess additional parameters such as business vintage, turnover and overall financial stability before approving the application. If you run a registered business with consistent income, you can check your eligibility and apply online with ease.
Documents Required for Business Credit Card
Once you meet the eligibility criteria and select a suitable Business Credit Card, keeping the required documents ready can help speed up the approval process. Documentation requirements may vary depending on the constitution of the business, such as proprietorship, partnership or company.
An indicative list of documents includes:
- Business Registration or Incorporation Certificate
- Proof of registered business address
- Financial documents such as recent Bank Statements, Audited Financial Statements or GST Returns
The Bank may conduct additional verification or request further documents based on the financial evaluation and internal due diligence process.
How to get a Business Credit Card?
One can apply for a Business Credit Card online or visit the branch of any nationalised bank to obtain one. The application process is also like any other personal Credit Card. You need to mention your occupation type, mobile number, annual income, etc. and the bank will generate the ideal Credit Card for you.
Learn more about Business Credit Card and apply online.