Credit Card Fees for Businesses

Monday, June 11, 2012 at 9:50pm by Site Administrator

What Kind of Fees Can I Expect With my Business Credit Card?

Small business owners have several options when it comes to separating personal from business finances and tracking business spending. A business credit card is one of the better-known options partly because of the large amount of money lenders put into advertising these cards. A credit account will provide advantages, such as increased spending limits over personal cards and rewards programs on expenses your business incurs anyway.

Every business account, even those from the same lender, is different. Comparing several interest, rewards, and fee structures can be time-consuming. Some may waive the annual fee the first year or only charge this fee under specific circumstances. Other cards charge exorbitant fees for late payments or specific type of transaction while others will be more lenient. There is a best credit card for your business, and the search begins with learning to recognize the common fee categories.

Balance Transfer Fee

Some cards entice customers with no-fee balance transfers, and this can be a good deal for your business. Other cards actually charge a balance transfer fee, which may be termed an introductory fee, to new customers. This fee is typically a percentage of the total transfer and will be capitalized the same as interest on a continuing balance. If you are opening a new account with the intention of transferring large balances into a zero percent grace period, pay close attention to the balance transfer fee in small print.

Annual Fees

A large number of the most heavily advertised cards use a lack of annual fee as a selling point. It sounds good in theory because few owners are interested in paying a lender for the privilege of spending money that will then face interest charges. An annual fee should not automatically discourage potential customers. Often, this fee is either waived the first year or only required in the absence of any transactions for the entire year. Annual fees can range from less than $10 to hundreds of dollars for more elite cards.

What does the annual fee signify? In some cases annual fees are associated with top-notch customer service. Other cards use the annual fee as a type of membership charge for their rewards program. Depending on the nature of your business and the card, it can be worth it to accept this fee. Reviews from the card’s customers will give you more clues.

Transaction Fees

This type of fee generally applies to only foreign transactions or cash advances. If you have a business requiring foreign travel or purchases from vendors using foreign currency, it is best to look for cards without foreign transaction fees. The fee is expressed as a percentage of the transaction, and it can become excessive with regular use.

Cash advance fees are common to every business credit card, but not all cards offer the ability to withdraw money without making a purchase. This transaction fee can be expressed as a percentage of the withdrawal, flat fee, or both. It is often stated as a dollar amount or percentage of withdrawal, whichever is greater. If you anticipate using cash withdrawals, read carefully because this information is often tucked away in the fine print.

Employee Cards

Small business cards are often marketed to owners with the assumption that additional cards will be unnecessary. It is possible to obtain cards for employees, but this service is not always free. For an established business with good credit, it is worthwhile to consider finding a new lender or a new card with the same lender to avoid fees on employee cards. For newer businesses, it is best to remember that unless the business card is obtained using only the business credit score, the lender is likely to request a credit report on every employee with a card.

The fee itself is typically only charged on issuance of the card, but it may be charged again for replacement. It can range from $10 to $30 or more per card. If you anticipate the need, many options are available without this fee.


With even one late payment or any other infraction of the rules, your lender can indefinitely raise interest rates to the maximum amount. They are not required to give notice of this either. This is a strong incentive to stay on top of payments. Another incentive is penalty fees. Lenders may impose any type and any amount of penalty fees. No one expects to miss a payment, but it is best to be familiar with the policy before signing an agreement.

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