Some alternatives to a secured business credit card are regular secured credit cards, small business loans and personal loans that approve applicants with damaged credit, and unsecured credit cards for bad credit. Most business owners looking for a secured business credit card want to rebuild their credit, and these alternatives can help toward that end. Unsecured business credit cards for bad credit are virtually nonexistent. But there’s no rule saying you can’t use a regular consumer credit card for business expenses - and if you go that route, get the best card you’re qualified for.
The best alternative to a secured business credit card is a regular secured credit card. Regular secured cards for consumer use have similar approval requirements as secured business cards, and there are a lot more consumer secured cards to choose from. Plus, you can find a few consumer secured cards that don’t charge annual fees, which you probably won’t find on the business side. Consumer cards also tend to have lower minimum deposits, and some have ongoing rewards for purchases, too.
Another option is to find a lender that caters to business owners with damaged credit. Some of these lenders, such as Fundbox and Headway Capital, have an annual business revenue requirement of $50,000 or more. But they accept applicants with less-than-good credit, so if your business fits the requirements, it may be worth looking into. Similarly, you might be able to get business funding with a personal loan, though the interest rates will likely be high if you have bad credit. And if you have a credit score under 550, you may not have much luck getting a personal loan.
Unsecured credit cards for bad credit are another alternative to a secured business credit card, though they are not the best option. The unsecured cards you’ll qualify for with bad credit tend to have higher interest rates and fees than secured credit cards. Such a card will help you build good credit history if you use it responsibly, but there are definitely cheaper ways to build credit.
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