How long does it take to get a business credit card?

Depending on the provider, it could take a few days or a couple of weeks for the business credit card to arrive in the post. Once you submit your application it will need to be reviewed by the card issuer but that is normally approved quickly.

Is my credit record checked for a business credit card?

Yes, when you apply for a business credit card, credit card providers will typically assess both your business's credit record and your company’s overall financial health. If your business has limited or no credit history, the card issuer may also check your personal credit score to evaluate your creditworthiness.

Does using a business credit card affect my personal credit record?

Using a business credit card could affect your personal credit card, particularly if you're the main account holder. It's best to use a business credit card sensibly, as you would a personal credit card, If you're worried about repayments you should speak to the card provider as soon as possible.

Can I get a business credit card with rewards?

Yes, business credit cards with rewards are available. These cards often offer cashback, allowing you to earn a percentage of what you spend back. Other rewards may include air miles, travel points, or shopping vouchers, depending on the card provider. Choose a business credit card with rewards that aligns with your business's spending habits to maximise the benefits.

Can several employees have their own card?

Yes, you can get multiple corporate credit cards under one account, which allows selected employees to have their own cards while the business receives a single bill. Many providers also offer spending controls, so you can set limits and monitor expenses for each card.

Do I need a business current account to apply?

No, a business current account is not a requirement to apply for a business credit card. However, having one can simplify managing your finances, making it easier to pay your bills and keep business transactions separate from personal ones.

Can I get a business credit card as a startup?

Yes, startups can apply for a business credit card, and it can be a useful tool for managing cash flow during the early stages. However, since your business is new, you may be asked to provide additional information to prove your ability to meet repayment requirements. This could include a personal credit check, company financial statements, and details of any assets, which will help the provider determine your credit limit.

Can I check my eligibility before applying for a business credit card?

Many providers let you check your eligibility online before applying. This typically involves a soft credit check, which won’t affect your credit score, and will give you an idea of your chances of approval prior to any application.

Are business credit cards interest-free?

Business credit cards aren’t usually interest-free. However, many providers will offer an interest-free period on purchases if you pay off the balance in full each month. If you carry a balance, interest will apply, so it’s important to check the terms.

Can I get a business current account with bad credit?

Yes, it’s possible to get a business current account even if you have bad credit, though it may be more challenging. Some banks and financial institutions offer business accounts specifically designed for people with poor credit histories. These will sometimes come with fewer features, but can still help you manage your business finances effectively. To improve your chances of being accepted for an account, you can take steps to enhance your credit history, such as paying bills on time, reducing outstanding debt, and regularly checking your credit report for errors.

How long does it take to open a business bank account?

Opening a business bank account typically takes between one and four weeks, though the process can be faster depending on the bank and your business type. Some banks even offer same-day account opening. Factors that can affect the timeline include your business structure (sole traders usually take less time), your relationship with the bank, and the application method. Some banks offer faster services, and non-residents or high-risk businesses may experience longer processing times. Once your application is submitted, the bank will conduct background checks and may contact you for additional information.

Can I use a personal current account for my business transactions?

While it’s technically possible to use a personal current account for business transactions, it’s generally not recommended. Keeping personal and business finances separate helps you stay organised, track expenses more easily, and simplify tax reporting. If you run a limited company, using a business current account is a legal requirement because your company is considered a separate legal entity. Sole traders aren’t legally required to have a business account, but opening one can provide tailored features, such as accounting tools.

What fees can I expect with a business current account?

The fees for a business current account can vary depending on the bank and the account type. Common charges to look out for include: Monthly maintenance fees: A fixed charge for maintaining your account. Transaction fees: Costs for deposits, withdrawals, and payments. Overdraft charges: Fees for accessing overdraft facilities. International transfer fees: Charges for sending or receiving money abroad. Debit card usage fees: Costs for using your business debit card, especially abroad. Some business accounts may offer free banking for an introductory period, so it’s essential to carefully review the fee structure to find an account that matches your business needs and budget.

Are business bank accounts protected by FSCS?

Yes, business bank accounts are protected by the FSCS up to £85,000, provided the bank is FCA or PRA-authorised. For small businesses or limited companies, protection applies if the bank fails. Sole traders have combined protection with personal accounts under one £85,000 limit. For more complex claims, eligibility may vary depending on your business type. Check with your bank for specific coverage details.

Can I have multiple business current accounts?

Yes, you can have multiple business current accounts. This can be useful for managing different aspects of your finances, such as separating operational expenses from tax savings, or tracking revenue for different projects. If you run multiple businesses, separate accounts for each can simplify accounting and financial reporting.

Do I need to maintain a minimum account balance?

Whether you need to maintain a minimum balance depends on the specific business current account you choose. Some banks may require a minimum balance to avoid fees or to access certain account features, while others may be more flexible. Review the account’s terms and conditions or ask your provider directly if you're unsure.

Are there any limitations on the number of transactions or cash deposits I can make?

Many business current accounts have limits on free transactions or cash deposits each month. Exceeding these limits may incur fees. Some accounts also cap the maximum cash deposit per day or month. To avoid extra charges, review the account terms and choose one that suits your transaction volume.

What happens if I close my business?

If you close your business, notify your bank and close your business current account. The bank will guide you through the process, which will typically involve settling any outstanding payments or fees. Any remaining funds can be transferred to a personal account or another business account.

Am I guaranteed an overdraft with a business account?

No, getting an overdraft with a business current account isn’t guaranteed. Just like with personal accounts, you’ll need to pass a credit check to be approved, and the overdraft limit offered will depend on both your financial circumstances, and the bank’s assessment of your business. If you need an overdraft, it’s a good idea to speak directly with your account provider to explore available options and understand the terms, including any fees and interest rates that could apply.

Is my business eligible to use the Current Account Switch Service?

Your business may be eligible to use the Current Account Switch Service if it meets the following criteria: Fewer than 50 employees Annual turnover of £6.5 million or less Both your current and new banks are part of the switch guarantee scheme If you're unsure whether your business qualifies, contact your new bank for confirmation and guidance on the switching process.

Can I have a business current account if I'm a sole trader?

Yes, sole traders can open a business current account, just like partnerships and limited companies. Having a dedicated account is smart as it separates personal and business finances, simplifying income tracking, expenses, and tax management. Many banks offer accounts tailored to sole traders with features like accounting integrations, invoicing tools, and business support, helping you manage cash flow and prepare tax returns more easily.

Can I use my business current account for personal transactions?

Generally, it’s not advisable to use your business current account for personal transactions. Keeping business and personal finances separate helps maintain clear records, avoid tax complications, and ensures compliance with accounting standards. Mixing personal and business expenses can lead to confusion and potential legal issues, especially when it comes to taxes and audits. Additionally, it's worth noting that many banks prohibit the use of business accounts for personal purposes.

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Card payments explained: a complete guide for small businesses

Small business guide to card payments

Q: How can I make sure I receive card payments securely?

There are a few things you can do: Use a trusted payment provider – Choose a reputable payment processor with strong security measures Enable encryption – Use encryption to securely transmit payment information Use 3D Secure – Implement additional authentication, such as Verified by Visa or Mastercard SecureCode for online transactions Monitor for fraud – Regularly check for unusual or suspicious transactions Keep software up to date – Ensure your payment systems and devices have the latest security updates installed Use secure payment terminals – If accepting in-person payments, use chip and PIN terminals to reduce fraud risks

Written by Kyle Eaton, Contributing writerEdited by Joe Phelan, Business finance editor, 31 March 2025

Fact Checked

Customers expect businesses to offer payment options that suit them, so those that don’t accept card payments may see significantly reduced revenue.

A card payment is a transaction made with a card instead of cash or a cheque.

Card payments are customers’ preferred payment method. They’re more convenient and secure than cash, meaning many of us no longer hit the shops with notes and coins. Understanding how card payments work and the benefits they offer can position your business for success. Here’s everything you need to know.

Key takeaways

Card payments offer convenience and security for both businesses and customers
Choosing the right payment provider and understanding fees are key to smooth card payment processing
You should avoid charging customers extra fees for card payments to stay compliant with UK regulations

Choose the best business bank account for your company with features including no set up fees.

Compare business bank accounts

What is a card payment?

A card payment is simply a transaction made with a card instead of cash or a cheque. It enables customers to pay in person at a point-of-sale (POS) terminal in a shop or online. The process is quick, as card details are processed electronically. This helps businesses accept more payments and provides security and convenience for customers.

How do card payments work?

You can process card payments in person at a POS terminal or online.

POS terminal

Also known as a card machine, a POS terminal is a card reader. It is typically fixed next to a till or connected via Bluetooth for transactions away from its base. Here’s how it works:

The customer presents their card by tapping, inserting or swiping their card at the POS terminal
The terminal processes the payment details and securely sends payment details to the customer’s card issuer
The transaction is approved or declined by the card issuer after checking customer funds and any fraud risks. If approved the:
Payment is confirmed. Once the transaction goes through, the terminal generates a receipt
Payment is transferred to the business’ account, usually within a few days

Online

Online, instead of a POS terminal, a payment gateway sends the payment details. Here’s how:

Customer enters card details: The customer inputs their card information when they reach the online checkout
Payment is sent: A payment gateway securely transmits the details to the card issuer
Approval or decline: The card issuer checks funds and fraud risk, then approves or declines the transaction
Confirmation is shown: If approved, the website confirms payment and the order is processed
Fund settlement: The payment transfers to the business’s account, usually within a few days

What are the different types of card payments?

Businesses can accept payments with a credit card or a debit card. But there are different types of each, so find out what they are so you can take payments with confidence, no matter what type of card a customer hands over.

Credit cards

A credit card allows the user to borrow money from a bank or lender to make purchases up to an authorised limit. The user repays the amount, often with interest, either in full or over time. Some of the common types of credit cards include:

Standard credit card: A basic card, often used for everyday spending
Rewards credit card: Offers points, cashback, air miles or other rewards when used
Balance transfer credit card: Allows users to transfer existing debt, often with 0% interest for an introductory period
0% purchase credit card: Offers 0% interest on purchases for a set period
Store card: Issued by retailers, store cards may offer discounts or rewards when used in store
Student credit card: Designed for students, typically with lower credit limits
Business credit card: Tailored for business expenses, they usually offer tools for expense management and reporting
Charge card: Allows the user to make purchases up to a set limit but requires full repayment of the balance by the end of each billing cycle

Debit cards

A debit card enables the user to spend money directly from their bank account, with funds deducted immediately. There are fewer variations compared to credit cards, but there are some different types available:

Standard debit card: These link to a current account and allow for everyday spending and ATM withdrawals
Business debit card: Issued to businesses through their business bank account, it helps manage company expenses and transactions
Prepaid debit card: Requires users to load funds on to the card in advance

What benefits do card payments offer my business?

Offering the option to pay by card provides a range of benefits. These include:

Increased sales

Card payments make purchasing easier for customers, boosting your sales potential.

Improved cash flow

Card payments process quickly, ensuring prompt access to funds.

Convenience for customers

Many customers prefer paying by card for its ease and security. It’s better not to put up barriers to payment.

Reduced risk of theft

Handling less cash lowers the risk of theft or loss.

Enhanced security

Card payments use encryption and fraud prevention measures, giving you and your customers peace of mind.

Global reach

Accepting card payments allows your business to serve international customers as well as those closer to home.

Better record-keeping

Card payments provide clear transaction records, which makes accounting less complicated.

How much does it cost my business?

The amount depends on the transaction method and payment process. You can expect to pay a small percentage per transaction as a processing fee, usually around 1-3%. Fixed monthly or pay-as-you-go fees may apply for the payment gateway or terminal rental, too, with additional charges for chargebacks, refunds or certain card types.

The benefits of increased sales and customer convenience often outweigh the costs. Either way, it’s a good idea to look out for the cheapest ways to accept card payments so you don’t pay more than necessary.

How do I set up card payments?

To accept card payments, find a provider that offers payment solutions suited to your business. Watch for potential costs, such as one-off set-up fees or long contracts, and proceed only when you’re satisfied with the terms.

FAQs

Can I accept card payments without a business bank account?

Yes, by using a payment facilitator to process transactions and hold funds for you. Services such as PayPal can handle this, but they may charge a fee for doing so.

Can businesses set a minimum spend for card payments?

Yes, and many businesses do to offset processing costs. However, be careful not to set it too high, because customers may go elsewhere.

Is it illegal to charge for card payments in the UK?

Yes, you cannot charge customers a fee for paying with a debit or personal credit card. However, you can charge fees for certain transaction types, such as those made with business credit cards or for services such as foreign currency exchange.

How can I make sure I receive card payments securely?

There are a few things you can do:

Use a trusted payment provider – Choose a reputable payment processor with strong security measures
Enable encryption – Use encryption to securely transmit payment information
Use 3D Secure – Implement additional authentication, such as Verified by Visa or Mastercard SecureCode for online transactions
Monitor for fraud – Regularly check for unusual or suspicious transactions
Keep software up to date – Ensure your payment systems and devices have the latest security updates installed
Use secure payment terminals – If accepting in-person payments, use chip and PIN terminals to reduce fraud risks

What is a payment gateway?

A payment gateway securely processes online card payments – think of it like an online POS terminal. It encrypts and transmits payment details between the customer, business and bank, ensuring quick, safe approval.