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Unsecured Business Credit Cards for Bad Credit and Other Funding Options

Reviewed by Ty Crandall

November 15, 2023


unsecured business credit cards for bad credit Credit Suite

If you need unsecured business credit cards for bad credit, you may feel like you’re out of luck. There are options though.  There are a few credit cards, but other options exist as well. 

How to Get Unsecured Credit Cards for Bad Credit, and What to Do If It’s Not Enough

When you get unsecured business credit cards for bad credit, you will likely see that you still need more funding to accomplish your goals. It will probably not be enough to do what you need to do. They can be a great tool for managing day to day expenses however. 

Unsecured Business Credit Cards for Bad Credit: Brex Card for Startups

The Brex card for startups is one of the few true options if you are looking for business credit cards with bad credit and no personal guarantee. Even a FICO as low as 300 may qualify.  There is no annual fee, and you can apply with your EIN rather than your SSN.

Discover our Get Business Credit guide, with everything you need to know about building credit for your business.

Business Revenue Lending

Another option is business revenue lending.  The minimum credit score is 500, so not having great credit is fine.  The trade off is your business must earn annual revenue of $120,000 or more, and it must do more than 5 small transactions each month.  If your business brings in at least $15,000 monthly, then 6 months in business is ok.  You will have to fill out an application and provide 6 months worth of bank statements. 

Unsecured Business Financing: Credit Line Hybrid

If the Brex card isn’t enough, the next best thing is a credit line hybrid. This is unsecured business financing stacking a number of credit cards.  It allows you to fund your business without putting up collateral, and you only pay back what you use, just like a single credit card. 

However, you do need a credit score of at least 700.  In addition, you can’t have any liens, judgments, bankruptcies or late payments.  Furthermore, in the past 6 months you should have less than 4 credit inquiries, and you should have less than a 45% balance on all business and personal credit cards.  It’s also preferred that you have established business credit as well as personal credit.

So, how is this the next best thing to an unsecured business credit card for bad credit? I mean, if you are looking for that, you probably do not meet the credit score requirement.  Here is the secret. You can take on a credit partner for this type of funding. Many business owners work with a friend or relative to fund their business. 

If a relative or a friend meets all of these requirements, they can partner with you to allow you to tap into their credit to access funding. 

The best part of this type of funding is that it reports to your business credit report, regardless of whether you use your personal credit to apply or that of a credit partner. That means, you get your funding and build your business credit at the same time. As a result, you will no longer have to worry about finding funding for bad credit, as long as you pay consistently on-time that is. 

Discover our Get Business Credit guide, with everything you need to know about building credit for your business.

A Word About Security: It Might Be Worth Itunsecured credit cards for bad credit Credit Suite

No one wants to use their personal assets or their business as a whole as security for business funding. However, if you have bad credit, your options are limited. These secured business funding options are much less harsh than standard secured business loans, and they work even with bad credit. 

Real Estate Financing

Likewise, you probably will not be financing real estate with business credit cards, even if it is 0 interest. You can get real estate financing in amounts up to $10 million with terms from 6 to 60 months and interest rates as low as 6%. 

You will need a 500 minimum credit score, and there are a few other requirements. 

Equipment Financing

If you need equipment, it might be better to consider equipment financing.  You will put up your existing equipment or the new equipment you want to purchase as collateral.  Amounts are available up to $10 million with terms ranging up to 60 months. You will  need a credit score of at least 550. 

You wouldn’t likely be able to fund either of these endeavors with an unsecured business credit card, nor would you want to. In these cases, using your purchase as collateral may be necessary to get over the bad credit hump.

Account Receivable Financing

To get this type of funding, you have to have open receivables from another business or government agency, not individuals.  In addition, you need to have been in business for at least one year. The minimum credit score is just 500.

You can get up to 80% of receivables advanced in as little as 24 hours. Even though you are using your invoices as security, it works more like a cash advance on money you have already earned. 

Merchant Cash Advance

If you accept credit cards payments, you may qualify for a merchant cash advance.  You only need a credit score of at least 500.  To qualify, your business must bring in $100,000 or more per year in credit card sales.  Typical approval amounts equal one months’ credit processing volume.  In addition to the application, you’ll need 3-6 months bank and merchant statements. 

Discover our Get Business Credit guide, with everything you need to know about building credit for your business.

Secured vs. Unsecured Business Funding

If you have bad credit, there are not a ton of business funding options available. Take what you can get, use security when you have to, and work on improving credit at the same time. If you need to have collateral, trying using whatever it is you are buying. This works especially well for real estate and equipment.  Then, you can save your unsecured business credit cards for bad credit and other unsecured options for day to day expenses.

Consider A Business Credit Expert

The best way to get rid of bad business credit is to work with a business credit expert. While it is possible to do it on your own, it’s not wise. Typically, it’s downright ineffective. Here’s why.  First, you have to be sure your business is fundable. Fundability is a complicated, tangled web and if you aren’t sure of every strand, a lot of things can slip through the cracks.

An expert can help you unravel each strand of the web and find issues with Fundability you likely never knew existed, and tell you what to do about them. 

Also, it is impossible to build credit without first having credit, unless you can find vendors that will report payments to business credit reports without checking credit history first. These do exist, but they do not necessarily make that knowledge public. 

The right business credit expert can save you a lot of time and money by pointing you toward the vendors that will work best for your business right now, and show you how to build on the credit they extend. 

There is a Time and a Place Use Unsecured Business Credit Cards for Bad Credit

It’s true. For short-term financing of day to day operations, or even smaller equipment, unsecured business credit cards for bad credit can work well. They are a great tool to have in your tool box. However, there may be times when you need more than this type of financing can offer. Not only that, but for larger equipment purchases and real estate, using security may be the only thing that makes sense.

Try using a business credit expert to help you decide which options will work best for you in your specific situation.  You’ll be glad you did. 

About the author 

Faith Stewart

Faith has a BBA with a major in Accounting, and a combined 20 years of experience in the fields of finance and account.

Before switching to writing, she spent 10 years working in various areas of small business and personal finance and accounting, including working as a public auditor at BKD, LLP, Financial Director at Central Arkansas Development Council, and Commercial Credit Analyst at Farmer's Bank and Trust.

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