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Looking to apply for a business credit card but have average credit? Here's the best choice for you

While many business credit cards require excellent credit to qualify, one stands out for people with average credit: Capital One Spark Classic for Business.

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The Capital One Spark Cash for Business is no longer available to new applicants; however, Capital One has launched 3 new business cards for small business owners. Click here to learn more. Terms apply to American Express benefits and offers. Visit americanexpress.com to learn more.

A business credit card can serve as a great way to help separate your company expenses from your personal ones, as well as another opportunity to earn more sign-up bonus offers. For example, new cardholders of the Capital One Spark Cash for Business can earn a one-time $500 bonus once spending $4,500 in the first three months.

But during uncertain times like these when your company may be cash-strapped, a business card can also step in to help you stay afloat.

If you've been shopping around for the best business card to apply for, you may have noticed that most require applicants to have excellent credit in order to qualify. However, Select ranked the best small business credit cards, and one stands out for people with fair credit.

Below, we take a look at the Capital One Spark Classic for Business* and break down why it is the best choice for business owners with fair credit. (See our methodology for more information on how we choose the best cards.) But first, we look at who exactly can apply for a business credit card.

Who can apply for a business credit card?

While applicants do need to have a business in order to be able to apply for a business credit card, what legally qualifies as a business varies. 

Generally, if you are doing something to earn a profit, whether full-time or on the side, it is considered a business. You can still be a business owner even if you don't have any employees working for you; you are thus acting as a sole proprietor.

What are some examples of this? Below, we list some entrepreneurial businesses or side hustles that you may be surprised qualify for a business credit card.

  • Doing freelance writing or photography
  • Dog walking
  • Tutoring
  • Consulting work
  • Babysitting
  • Selling crafts or goods online, such as on Etsy or eBay
  • Rating products at home as an influencer
  • Filming content for a YouTube channel
  • Running a soccer league or teaching piano lessons
  • Driving for Uber or Lyft in your free time

Why the Capital One Spark Classic for Business* is the best credit card for business owners with average credit

Not only does the Capital One Spark Classic for Business* allow business owners with average credit to qualify, it also comes with no annual fee and the option to add any additional cards for your employees at no cost.

According to Capital One's credit level guidelines, you may have average credit if you have defaulted on a loan in the past five years or if you have limited credit history (credit in your name for less than three years). This may include students, those who are new to the U.S. or authorized users on someone else's credit card, the issuer's website states.

In addition to allowing those with average credit to apply, the Capital One Spark Classic for Business* is also a cash-back card that lets users earn an unlimited 1% cash back on every purchase for their business, with no minimum to redeem. This means that you can cash in at any time and for any amount, whether as a check or a statement credit applied to your balance.

Spark Classic* cardholders will also receive Capital One business benefits like accounting services (downloading your purchase records to Quicken®, QuickBooks® and Excel®) and customized spending limits for employee cards. You will also be eligible to receive Visa® business benefits, including 24/7 travel assistance and auto rental damage waivers.

The good news is that if you use this card to help build a better credit score, you can eventually qualify for other business cards that offer luxury perks, such as The Business Platinum Card® from American Express, or that help you finance new purchases, such as The Blue Business® Plus Credit Card from American Express.

Capital One Spark 1% Classic

Information about the Capital One Spark Classic has been collected independently by CNBC Select and has not been reviewed or provided by the issuer prior to publication.
  • Rewards

    Earn unlimited 5% cash back on hotels and rental cars booked through Capital One Travel and 1% on all other purchases

  • Welcome bonus

    None

  • Annual fee

    $0

  • Intro APR

    None

  • Regular APR

    30.74% variable

  • Balance transfer fee

    None

  • Foreign transaction fee

    None

  • Credit needed

    Average

Terms apply.

Pros

  • No annual fee
  • Free employee cards
  • Average credit may qualify
  • Redeem cash back for any amount at any time
  • No fee charged on purchases made outside the U.S.

Cons

  • No welcome bonus
  • No introductory 0% financing offers for purchases or balance transfers

Our methodology

To determine which business cards offer the best value, Select analyzed 21 of the most popular credit cards available to U.S. business owners. We compared each card on a range of features, including annual fee, employee card fee, rewards, welcome bonus, introductory and standard APR and foreign transaction fees, as well as factors such as required credit and customer reviews when available. We also considered additional perks, the application process and how easy it is to redeem points.

The main criteria in our ranking were the rewards rates and added benefits, such as redemption bonuses, insurance coverage and expense management features. The more perks a card had, the higher it ranked on our list.

Co-branded business cards, such as airline or hotel-specific cards, did not make our final list due to their often complex reward systems and potential to limit your travel options to a specific brand.

*Information about the Capital One Spark Cash for Business has been collected independently by Select and has not been reviewed or provided by the issuer of the card prior to publication.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
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