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Do Business Credit Cards Affect Personal Credit Score?

So you want to borrow and make it possible for your business to grow? Getting a business loan can be a lengthy process — the access to business credit cards is much less rocky and can set you up quickly to access the funds you need. However, conscientious business operators know that business credit cards can affect your personal credit if you're not careful.

Either through high amounts of debt or late repayments, careless use of a business credit card will cause the personal credit score of the business owner to be negatively affected. It’s an important point to consider, as employees with access to company cards aren’t risking their personal scores through their spending. Even if you find a business credit card provider who doesn’t report to consumer credit bureaus, the owner remains personally liable for all costs if your business defaults on its debt.

The flip-side of this coin is that, by choosing the right business credit provider, you can maintain responsible borrowing and develop a business credit that will empower your business down the road. Here are some ways that using a business credit card can impact your personal credit score.

The Low Down - How do Business Credit Cards Affect Personal Credit Score?

There are two main ways that your personal credit score is affected by your business spending. First, most business credit card providers will also do a personal credit score check at the moment of application, which can negatively affect your credit score. Additionally, the reporting of any delinquencies may also have an impact.

Credit inquiries when applications are submitted

When you apply for a loan or a credit card for your business, banks can make a hard inquiry into your personal finances and judge if you are financially capable of making repayments. On average, people who make frequent applications for various types of credit are the most likely to declare bankruptcy. So, each time you make one of these inquiries, you are potentially harming your personal credit score by a few points.

This minor loss of points will remain on your personal credit history for two years. So don’t just apply for any option you can find, do your research and find the right lender for you.

If you are a business with irregular income, you might need to pursue more flexible repayment options. There is less chance of being reported for missing repayments but high penalties and potential damage to your personal credit score. If you can rely on regular cash flow into the business, then you can choose a business card lender like Archa that doesn't need to make invasive checks into your personal history. Empower your business without putting your personal credit score on the line — get in contact with Archa today.

Reporting any delinquency

Bank policies require them to report any late or unpaid credit. In fact, a lot of banks will report all credit behaviour to a relevant credit agency. Regardless, if your business goes through a lean period and has high debt or is late to make payments, your personal credit score will suffer because of poor performance.

As a business operator, it may benefit you to do some shopping around and find a business credit card provider that only reports to commercial agencies. Additionally, there are cards out there that don’t require any personal guarantee, so it eases a lot of the risk to your personal credit score. But, again, it is about making the choice that best suits your cash flow needs and offers you the least risk personally should anything go awry with the business.


Regardless of what it seems, business credit cards can affect your personal credit score. When using credit, it is important to keep this in mind, as most companies will report all spending and repayments on the card to a relevant credit agency. From the point of application, right through the life of the card, reckless behaviour will result in a downgrading of your personal score. On the other hand, if you are responsible in your borrowing, there is the potential for gain, especially if you lack any personal credit history yourself.

You must practice smart spending habits before you acquire your business credit to use the credit reporting to your advantage. If you can pay on time, keep your credit balance low and be smart in how you spend, you could make a business credit card work for your personal credit score rather than against it.

Archa is a business credit solution that doesn't require a specific personal credit check to access business credit. Through our monthly fees and repayments, you are able to enjoy all the benefits of business credit cards without having to worry about impacting your personal credit score. Contact our team today and start the onboarding process, so we can start you on your journey into business credit today!