Safeguard your personal liability and financial autonomy by securing a business credit card that’s not linked to your social security number. When filling out business credit card applications with only an EIN the pros certainly outweigh the cons. A few viable approval options without using your SSN include retail store cards, gas cards, and prepaid business credit cards.
EIN Only
How can you get business credit without a DUNS Number or your Social Security Number? The answer is your use your EIN instead on the credit application.
When applying for business credit, the majority of creditors will ask you to provide an SSN or DUNS number. These are required for tracking your financial information and whether or not you have the ability to pay for the amount that you borrowed.
How limited are your business credit options with using an EIN over a DUNS Number? In many cases, using an EIN will limit your available options for the best corporate credit cards, retail store cards, gas cards, and prepaid business credit cards.
Depending on the lender, even with an EIN, you might still need to provide your SSN, so you have to be careful of this when you apply. Always inquire if it’s the only requirement to apply, as wherever possible you want to avoid any business credit association that has security tied to your Social Security Number.
Business Credit Cards
The options below are similar to corporate cards in that they offer high-spending limits, but with a bonus that they don’t require a personal guarantee to get approval. If have at least $50,000 in your business bank account, you could also qualify for a Brex Corporate Card.
Divvy
Businesses of all sizes can be granted access to the funding they need through Divvy. Similar to a corporate credit card, they offer a smart credit line that comes with unlimited physical and virtual credit cards and an app that manages all of your employee spendings.
Normal business owners can receive credit limits up to $50,000, but it’s the all-in-one expense management solution that keeps them coming back. The fully-featured Divvy mobile app is available to all cardholders and will help you easily manage your business budget.
Divvy card purchases can are automatically categorized with a few taps and can help do away with out-of-pocket reimbursements and manual expense reports. Budgets can be built with admins and users, funds divided as needed with spending controlled and tracked in real-time.
All Divvy customers are also protected by account security protocols such as proactive fraud protection, PCI DSS certification, and SOC2 Type 1 compliance.
KleerCard
As a small business owner, you can apply for a KleerCard in about 5 minutes with no personal guarantees required. This all-in-one platform similar to Divvy is designed to manage your spending, credit building, and automate your accounting from within a single, easy-to-use system.
A KleerCard is best suited for growing businesses aside from being a credit card you can use to make purchases anywhere, it’s a great expense management tool. You can create separate physical and virtual cards for all of your employees, as well, as control spending and access to them individually.
As purchases are made on each card, the automated accounting files everything within the system and allows you to review, categorize, and sync it.
Secured Credit Cards
There are a few prepaid business card issuers that small business owners should look into. The secured business credit cards below offer easy approval and offer monthly payment reports to multiple business credit bureaus.
Be forewarned, even though these credit cards are secured and tied to your business, they may still require a personal guarantee to get approval, and will usually only do a soft pull.
Proper Usage
To receive a D&B PAYDEX score of 100 per transaction, you must pay off your purchases on invoicing Day #1. Try not to buy anything on these cards that you can’t pay off in full within 24-48 hours.
Doing so will also ensure your personal credit utilization ratio is never compromised, and by adding a larger security deposit, it may even be possible to lower your CUR at the same time.
As long you follow the instructions above and pay invoices early rather than late, you can build business credit fast without harming your personal credit score when using secured business credit cards.
Typically within 6-9 months of well-managed usage, you will start to receive pre-approved offers from these very same business credit card issuers. Your secured credit card would then be the stepping stone that helped get approved for a get 0% APR business credit card or high-paying rewards card.
Capital One Spark
Secured Business Credit Card
The Business Spark Classic is a great small business credit card that offers easy approval, even for those with fair credit. Most importantly purchases on your Spark Classic card will earn you 1% cashback, and all payments will get reported monthly to Dun & Bradstreet, Experian, and Equifax.
The catch-22, however, is a secured business credit card. To get your application approved, you will need to make a security deposit of at least $200, which in turn, will become your credit limit and be held until you no longer need this card.
Retail Store Cards
These are the bread and butter of tier 2 business credit as you can obtain quite high limits from several corporate store credit cards. As long as you manage their usage properly and don’t make any business credit-building mistakes, they can be a stepping stone to obtaining business loans and credit lines.
Sam’s Club MasterCard
Many small business owners already shop at Sam’s Club, so it makes sense to make this your first application stop. There are many perks to owning Sam’s Club Business credit card such as member rewards and being able to use the card at Walmart too.
You will need Sam’s Club membership to apply, as a new business, you should think about doing a month or two of shopping before applying. On the application, it will say a personal guarantee is required, but you can still submit without it. It’s best to do this in-store, so you can have the rep contact their credit department for you. You can read more about how to apply for a Sam’s Club Business MasterCard in our review.
Gas Cards
There are numerous gas cards and fleet cards that will approve your credit application with just your EIN, but there are a few catches.
First off, new businesses typically need to have at least 5-8 active tradelines from tier 1 credit vendors before they can apply. These are easy to get, but they can take 30-60 days to start reporting.
Secondly, while they might forgo a personal guarantee, some corporate gas cards may require a security deposit of $200-$400 to waive it. If you get denied instant approval online you can always call their credit department and ask about adding a security deposit or what else you might require to get approved.
Some of the easiest application requirements can be found at AtoB and Fuelman.
Pros
There are many reasons why you should only use your EIN when filling out a business credit card application. The most important advantage of all is to simply remove personal liability from all business purchases paid with credit.
Business Separation
When you keep your personal and business finances separate, you not only add an extra layer of personal protection, this tax-efficient system will make your accounting a lot easier too. Interests paid on business debt are also tax-deductible, which is reason enough to apply for business credit with your EIN only.
By making sure your company purchases get reported to business credit bureaus, you will start to quickly build business credit. Just remember to specifically target business credit cards that Capital One Spark that report payment history to multiple credit bureaus.
No Personal Liability
When adding your Social Insurance Number (SSN) to a credit application, you’re likely to also sign a personal guarantee for any and all debts incurred. Even if your business declares bankruptcy, you will be personally responsible to ensure all money borrowed, plus interest is paid back. If you’re unable to pay these debts, creditors can then start garnishing your wages and placing liens on your personal property.
As long as you don’t offer a personal guarantee, even if your business ever goes into debt or defaults on loans, it will have zero effect on your personal credit scores and liability.
Higher Credit Limits
It is much easier to get $50,000-$500,000 credit limits for your business than it is secure this personally. Businesses in general, tend to spend more money, and as such, as given higher credit limits. Even startups and recently established businesses get instantly get thousands of dollars just by applying for easy approval net 30 vendors.
If you have revenues to qualify for corporate credit cards like Divvy, you might even get easily get approved for up to $50k instantly.
Personal Credit Protection
By not submitting your SSN, you deny credit underwriters permission to review your personal credit files at Transunion, Experian, and Equifax. Many lenders will do hard pull when you apply for business credit, and each HP will cause a negative ripple effect on your personal credit scores.
By only applying with your EIN, you can ensure there will be no personal credit checks, and that even if you are denied credit, it will not affect your personal credit files in any way.
Avoid Personal Credit Checks
At times, you may simply want to avoid lenders knowing if you might have bad personal credit. Even if you have excellent credit scores at all three personal credit bureaus, removing a possible hard credit or bad payment report will help keep your personal credit in good standing.
Avoid Identify Theft
Keeping your social security number secret from as many people as possible is the best way to avoid identity theft. You never know which lender might one day get hacked, so the less personal information you submit on a business credit application, the better.
To combat this issue, we highly recommend you consider subscribing to Nav Business Boost ($40/mo), as you will receive access and alerts to changes in both your personal and business credit files, along with receiving $1M in identity theft protection insurance.
Cons
When applying for business credit using your EIN only, it’s not always going to be coming up roses. While you’ll limit personal liability, you’ll also alienate many lenders who will not be willing to extend you credit.
Limited Options
Unfortunately, almost all business credit cards available today require applicants to provide a personal guarantee and require a hard pull of your personal credit score. Credit lenders request this, because 50% of businesses will fail within the first five years, and there’s simply too much risk when not asking for personal liability.
You can, however, seek out, corporate business credit cards, corporate fleet, and fuel cards, as well as retail store cards that can approve your application based on your business credit history alone.
Application Denial
Even if you have a PAYDEX score of 80 or higher, and good to excellent credit scores with Experian Business and Equifax Business, you can still get denied credit approval. Some lenders simply won’t take the risk, but also try speaking directly to the credit department to see if they will wave the personal guarantee before you agree to it.
Lower Scores
If your credit applications are consistently getting denied based on your current business credit history, this perception of overextending may cause a drop in your business credit scores. Simply put, you should not be applying for any type of business credit that you’re unlikely to meet the application requirements.
If your business is recently established, you should first apply to net vendors for new businesses like Nav Business who will approve anyone with an EIN. After you’ve been in business for 30 to 90 days and have some tradelines reporting, you then can then start applying to the remaining Tier 1 credit suppliers.
Once you have 5-8 active tradelines and at least 90 to 180 days in business you can then move on to Tier 2 credit vendors which include many retail stores like Home Depot, Staples, and Sam’s Club. Only once you’re there and have 8-12 tradelines should you look into getting a good 0% ARP business credit card or cashback business reward card.
EIN vs SSN
Why is it better to apply for credit using an EIN (Employer Identification Number) over an SSN Social Security Number? Using an EIN to get business credit is better because it allows for easier approval and avoidance of personal liability.
There are two kinds of credit scores, one for business (tied to your EIN or DUNS Number) and one for personal credit (tied to your SSN).
When using an EIN on your credit or loan application, approval will be mainly based on your business’s financial status rather than your personal financial status.
Unless you have poor business credit, it will always be better for your business’s financial status to be evaluated and to limit your personal liability. If you need to build up your business credit, then you may still need to provide your SSN when applying for credit to tack on some personal security. Without an EIN, however, every dollar of credit you apply for will need to be personally secured.
If you have bad personal credit and use your SSN on the application, this can also be a reason for denial. Poor personal credit scores will reflect badly on your business, even if your business credit score is good.
EIN vs DUNS
Is using a DUNS number vs EIN better when applying for business credit? Unfortunately, there is no real comparison here, as your tradeline, business credit, and loan opportunities will increase exponentially if you have a registered DUNS Number.
Credit reports from Duns & Bradstreet are well respected and positive ratings in our report will open up a lot of doors for you, especially when it comes to applying for business credit and loans.
With that being said, the second most viable option to get business credit beyond a DUNS Number is to use your EIN.
While your options will be limited when only using your EIN, you’ll still be able to apply for:
- Some corporate credit cards, like Brex
- Some store cards, like Office Depot or Home Depot
- Most gas cards
- Most pre-paid business credit cards
Getting business credit through a DUNS number will limit your risk and really, all you have to do to get one is register at the Duns & Bradstreet website.
Your business credit options will be limited when not using a DUNS Number or an SSN, but there are a few that only require an EIN to apply. A Brex Corporate Card is a good example where you can get approval without the need for any other business or personal identification number.
Other options include store cards, gas cards, and pre-paid corporate credit cards, which at times, can be more than enough to your business up and running.