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The Ultimate Guide to Secured Business Credit Cards

Secured Business Credit Cards

A secured business credit card can be a great tool for establishing or rebuilding business credit. With a secured card, you make a refundable security deposit that becomes your credit limit. As long as you make your payments on time, a secured card reports your activity to the business credit bureaus, helping you establish a positive payment history. In this comprehensive guide, we’ll cover everything you need to know about secured business credit cards, including:

What is a Secured Business Credit Card?

A secured business credit card works just like an unsecured card, with one key difference – you have to make a refundable security deposit that acts as collateral and determines your credit limit. 

For example, if you deposit $500, you will have a $500 credit limit on the card. The card issuer holds onto your security deposit while you use the card, and releases it back to you once you close the account in good standing.

Secured cards are designed for those trying to establish or rebuild credit. They allow you to access revolving credit to make purchases while minimizing the risk for the card issuer since your deposit covers the credit line.

Make sure you only use a secured card specifically designed for business use, not a consumer-secured card. Using consumer cards can harm your business credit profile.

How Secured Business Credit Cards Help Build Credit

The major benefit of secured business credit cards is that they report your payment activity to the business credit bureaus – Experian, Equifax, and Dun & Bradstreet. 

This helps establish a positive payment history in your business credit reports, which is one of the most important factors in determining your business credit scores.

Here are some key ways secured cards can build your business credit:

  • Establish credit history If you’re just starting a business, you likely don’t have any credit history. A secured card helps establish initial positive payment activity.
  • Rebuild poor credit If you have delinquencies or other negative marks on your business credit reports, a secured card can help demonstrate you now manage credit responsibly.
  • Qualify for unsecured credit After 6 months to a year of positive payment history with a secured card, many issuers will graduate your account to an unsecured card.
  • Increase credit limits – Responsible use of a secured card may prompt issuers to increase your credit limit, further boosting your purchasing power.


The key is using the card responsibly by making all your payments in full and on time. This establishes positive payment behavior in your credit file.

Also Read: PayPal Business Loans – Fast Financing for Your Business

Pros and Cons of Secured Business Credit Cards

Secured cards come with unique advantages and disadvantages compared to traditional unsecured credit cards. Here are some of the key pros and cons to weigh:


  • Easier to qualify – Issuers take on less risk since your deposit covers the credit line.
  • Establish credit history – This can help build a positive file with the business credit bureaus. 
  • Rebuild credit – A way to reestablish positive payment behavior after financial difficulties.
  • Graduate to unsecured card – Responsible use may lead the issuer to graduate your account and refund your deposit.


  • Upfront deposit – You have to put down a deposit equal to your credit limit.
  • Lower limits – Credit limits are directly tied to your security deposit, usually starting around $200 to $500.
  • Annual fees – Annual fees range from $29 to $99 per year typically.
  • Security deposit is tied up – Your funds are not accessible until you close the account in good standing.
  • Authorized user tradelines only – Some secured business card issuers report authorized user tradelines rather than primary tradelines.


For most starting or trying to rebuild credit, the pros outweigh the cons. Just make sure you understand the terms so your expectations align with how the card works.

Secured Business Credit Card Options

Several major issuers now offer secured business credit cards. Here are some of the most popular options:

Wells Fargo Business Secured Credit Card

  • $0 annual fee
  • Credit limits from $500 to $10,000  
  • Reports to Experian and Dun & Bradstreet as the primary cardholder
  • May graduate to unsecured card in as little as 6 months

Capital One Spark Classic Secured

  • $0 annual fee
  • Credit limits from $200 to $2,000
  • Reports to Equifax and Dun & Bradstreet
  • Cash rewards program

Brex Corporate Card for Startups

  • $0 annual fee
  • Credit limits from $1,000 to $100,000
  • Reports as the primary cardholder
  • Great for high-value spends with 12x points on rideshares

Deserve Pro Mastercard for Business 

  • $0 annual fee
  • Credit limits from $200 to $10,000
  • Reports as the primary cardholder
  • No SSN required to apply 


As you can see,  Wells Fargo Credit Card, Capital One, Brex, and Deserve all offer compelling secured cards tailored for rebuilding business credit. Consider costs, credit limits, and cardholder benefits as you evaluate your options.

Eligibility Requirements

Since secured business credit cards still involve a credit approval process, you may be wondering – how can I qualify for a secured card if I don’t have good credit yet?

Here are some typical eligibility requirements to qualify for a secured business credit card:

  • Time in business – Most want to see at least 6 months to 1+ years in business. This establishes you have an operating company.
  • Gross annual business revenue – Requirements range from $1,000 to $100,000+ in yearly revenue.
  • No recent bankruptcies – Bankruptcies usually must be discharged at least 12 months prior.
  • Social Security number (some lenders) – Providing your SSN helps verify your identity and expedite approval.
  • No history of fraud or outstanding bad debt – These raise red flags for credit decisions.

The approval criteria are designed to verify your business is up and running and that you have the means to make monthly payments. As long as you meet these requirements, approval odds are very high.

How to Apply for a Secured Business Credit Card  

Ready to move forward with a secured card for your business? Here are some tips for a smooth application process:

  • Compare cards – Consider the costs, credit limits, reporting methods, and benefits of the top-secured business card options above. 
  • Gather documents – Have the following ready to submit: photo ID, tax ID, business license, bank statements, and a voided check (some lenders).
  • Check requirements – Verify you meet the minimum time in business, revenue, and other eligibility criteria before applying.
  • Apply online – Applying through the issuer’s website is quick and easy. Make sure to provide accurate information.
  • Secure card ASAP– Once approved, complete any final steps required and secure your card right away to start establishing a positive payment history. 
  • Use responsibly – Careful, on-time payments will help build your credit profile over time. Keep utilization low by paying in full each month.

With the right preparation, you can apply for and obtain a secured card smoothly. Then it’s up to you to leverage it strategically in rebuilding your business credit.

Also Read: How To Choose Between Paypal Vs Stripe Merchant Accounts

Graduating to an Unsecured Card

The ultimate goal with a secured credit card is to demonstrate responsible use that prompts the issuer to graduate your account to an unsecured line of credit. This refunds your security deposit and boosts your available credit.

Here are some tips to graduate from a secured card to an unsecured line as quickly as possible:

  • Pay on time, every time – Perfect payment history is key. Set payment reminders to avoid ever missing a due date.
  • Keep utilization low – Using 30% or less of your credit limit shows you’re able to manage higher limits responsibly. 
  • Avoid unnecessary hard inquiries – Limit new accounts to reduce credit checks that could impact graduation decisions.
  • Ask for reviews – Request reviews every 6 months and ask what else you can do to graduate the account. 
  • Get employee referrals – Ask to be referred to credit graduation teams who can evaluate your account for an upgrade.


Meeting graduation requirements typically takes 6 to 12 months of perfect payment activity. The sooner you graduate, the sooner you can get your deposit back and access higher credit limits.

Rebuilding Business Credit with Secured Cards 

If you’ve struggled with business credit missteps in the past, secured cards present an opportunity to reset your profile and demonstrate you’re a responsible credit manager moving forward.

Here are some final tips for leveraging secured cards to rebuild from past mistakes:

  • Open 1-2 secured cards so you can manage accounts responsibly. Too many new accounts can be seen as risky.
  • Charge small purchases each month and pay balances off in full and on time. Even a $5 monthly charge will establish a positive history. 
  • Once your secured card graduates, keep the account open and apply for new unsecured business credit. New accounts grow your total credit limits.
  • Continue perfect payments as you take on new credit. This shows positive behavior.


When choosing a business credit card, it’s important to consider your credit history and qualifications. For newer businesses or those without an extensive credit profile, secured business credit cards can be a good option.

Secured cards require a refundable security deposit, which becomes your credit limit. This allows you to build business credit from scratch and qualify for a card even with poor personal credit. Making on-time payments with a secured card demonstrates creditworthiness and can help establish positive business credit over time.

One great secured business card option is the Secured Mastercard® from 5 Star Processing. It is an established merchant services provider that offers comprehensive payment solutions for businesses, including credit card processing, POS systems, mobile payments, and more.

The Secured Mastercard from 5 Star Processing requires a minimum $500 security deposit to get started. It offers 24/7 US-based customer support, free additional cards for employees, and tools to help track business expenses. With competitive fees and rates, this secured card can help you build your business credit profile while benefiting from 5 Star Processing’s secure payment technology.

No matter where you apply, secured cards allow entrepreneurs and startups to access credit cards they may not qualify for otherwise. Building good business credit opens up more options in the future for credit cards, loans, and other financing needed to grow your company. Be sure to make payments on time and keep utilization low to demonstrate creditworthiness. With responsible use, a secured credit card can be the first step toward unlocking your business’s financial potential.

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