Secured business credit cards can report to some business credit bureaus to build business credit, but some don’t report directly to business bureaus. And much like unsecured business credit cards, each card issuer has their own policy about what they report to personal credit bureaus. For example, the Wells Fargo Business Secured Credit Card does not report to personal credit bureaus, so it won’t build personal credit. On the other hand, it reports business credit information to the Small Business Financial Exchange, which then licenses that information to business credit bureaus.
Most people with secured credit cards are using them to rebuild damaged credit. If you want a secured business card to build your business credit, it’s advisable to call and ask about the card issuer’s business credit reporting policy. Keep in mind that business credit is built differently than personal credit, and you may need to take extra steps to effectively build credit for your business.
On the other hand, if you are looking to rebuild your personal credit score with a secured business credit card, you should call the card issuer to make sure they report to personal credit bureaus. Or just use a general-purpose secured credit card.
Business credit can affect personal credit, but how much of an impact it has depends on the credit card issuer. A little more than half of all major credit card issuers report business credit card information to consumer credit bureaus, according to WalletHub research. But they all handle business credit reporting a little differently.… read full answer
Capital One and TD Bank regularly report business credit card information to both consumer and commercial credit bureaus.
American Express only reports negative information about business credit cards to consumer bureaus, and reports all information to commercial bureaus.
Chase and Discover only report information to consumer bureaus if the account becomes seriously delinquent.
Bank of America, Citibank, Barclays, and Wells Fargo only report business credit information to commercial bureaus, leaving consumer bureaus out of the loop.
At this point, it’s important to note that business credit scores and personal credit scores are compiled in different ways, using information from different credit bureaus (or at least separate divisions within a bureau). For example, Experian and Equifax both have business and consumer wings, but information isn’t shared between business and consumer files.
Nevertheless, there is a fundamental connection between business credit and personal credit scores. Most business credit cards require a personal guarantee, which means the primary cardholder will be personally liable for any debts incurred by the business. That’s the real reason why business credit affects personal credit to begin with. A business credit card user’s personal finances are relevant when it comes to an issuer’s ability to collect repayment for any future balance. As a result, most business credit cards ask for both an EIN and a Social Security number in order to assess both an applicant’s personal and corporate credit histories during the application process. And that, in turn, explains why applying for nearly any business credit card will put a hard inquiry on your personal credit report.
That said, having a business credit card that affects your personal credit report can also be a good thing, if you use the card responsibly. If your business credit card issuer reports all information to your personal credit report, it can help your score to have the positive information reported on a regular basis.
The only secured business credit card that reports to D&B is the Wells Fargo Business Secured Mastercard. It offers 1.5% cash back on all purchases, charges an annual fee of just $25 and requires a security deposit of at least $500.
There are just two other secured business credit cards available right now: the BBVA Compass Business Secured Visa and the Metro Credit Union Visa Secured Card. Those two report to the three major consumer credit bureaus – Experian, Equifax and TransUnion – but not to D&B, at least not directly. Dun & Bradstreet often incorporates information from the other bureaus’ reports.… read full answer
Here’s what you should know about secured business credit cards that report to D&B:
1 of the 3 available secured business credit cards reports to Dun & Bradstreet: Wells Fargo Business Secured Mastercard.
All major secured credit cards report to the three consumer credit bureaus: Equifax, Experian and TransUnion.
D&B, Experian and Equifax are the three major business credit bureaus.
Dun & Bradstreet reports are geared more to credit agreements with vendors, bank loans and annual revenue data.
Your personal credit history is much more important than your business’s credit history when it comes to getting approved for a business credit card.
Small business owners are personally liable for debt on nearly all business credit cards.
Although opening a credit card is the easiest way to build credit personally, it’s not as efficient with business credit.
If you want to build business credit, your first step to be to register for a D-U-N-S Number from D&B. This will get you on Dun & Bradstreet’s radar, at the very least. You should also open a business bank account using your Employer Identification Number. That will help establish a financial identity for your company that’s separate from you as an individual. And then you need to ask your vendors to report your payment history to D&B using your D-U-N-S.
That’s at least what Dun & Bradstreet recommends. Tracking so-called trade credit is one of the most important things business credit reports do that personal reports don’t.
There are some business credit card issuers that will not report small-business credit card activity to consumer credit bureaus: Bank of America, BBVA, Citi and Wells Fargo. The rest may report negative information only if your account is seriously delinquent.
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