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 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.

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.

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.

Is it worth having more than one business credit card?

The number of business credit cards you should have depends on your business's needs. If your business has varied expenses, like travel or supplies, multiple cards can help manage these categories and maximise rewards (e.g., cashback or travel points). However, it’s important to manage credit limits carefully to avoid high credit utilisation, which could affect your credit score. Multiple cards can also help with cash flow management by spreading out payment due dates, but make sure you can track and manage each account effectively. Ultimately, choose the number of cards that fits your business spending and financial management capabilities.

How do business credit cards impact business taxes?

Purchases made for business purposes using your credit card, such as office supplies or travel expenses, can typically be claimed as business expenses when filing your taxes. It's important to keep detailed records of all transactions to ensure they are valid tax-deductible expenses. Business credit card statements can be a helpful tool for tracking and categorising these expenses for your self-assessment or corporate tax returns. However, interest paid on outstanding balances is generally not tax-deductible, so it's crucial to manage payments and avoid carrying a balance. It’s generally a good idea to consult with an accountant to ensure you're complying with tax laws and making the most of available deductions.

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

Approval times vary by provider. Some offer instant decisions, and you may even receive a digital card the same day. If additional verification is needed, approval can take a few days, and the physical card typically arrives within 5–10 working days. To speed up the process, have the following information ready: Business name and trading details Company registration number (if applicable) Financial figures (e.g., annual turnover) Personal details for directors or partners

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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What is the cheapest way to accept card payments in the UK?

What is the cheapest way to accept card payments in the UK?

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

Fact Checked

Businesses that accept card payments are hit with fees from all sides, so how can you keep them to a minimum?

You can reduce card payment costs by choosing the right payment method for your business

There are many factors to consider when it comes to card payments, all of which affect the fees you pay. Customers can pay online, in person or over the phone, for instance, while businesses can accept payments through providers offering pay-as-you-go plans or subscriptions.

However, the charging structure is far from straightforward – some providers charge upfront fees, while others take a percentage of each transaction. With so many choices, finding the most suitable and affordable option can be challenging.

Our guide can steer you in the right direction and help you reduce card payment costs.

Key takeaways

Pay-as-you-go payment providers offer low-cost options with no monthly fees, making them ideal for small businesses
Online payments eliminate the need for expensive hardware and long-term contracts
In-person payments offer a cost-effective option if you opt for a mobile card reader and pay-as-you-go pricing

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

Compare business bank accounts

Types of card payment fees

If your business accepts card payments or plans to, expect to encounter fees. It’s helpful to understand the fees charged, so you can plan accordingly. Here are the most common:

Transaction fees

These typically range from 1% to 3.5%, sometimes with an additional flat fee on top. This fee varies depending on the provider, and costs between 10p and 30p per transaction.

Monthly fees

Some providers charge a fixed monthly fee for access to their payment platforms. This is priced from £10 to over £50, depending on transaction volume. Others offer pay-as-you-go pricing with no monthly fees.

Chargeback fees

If a customer disputes a transaction and wins, the provider charges a fee on top of the refund. This ranges from £15 to £25 per chargeback, although some providers may refund this if you successfully dispute the claim.

Refund fees

Some providers keep the original transaction fee when processing refunds. If you issue a lot of refunds, check this policy before choosing a provider.

Hardware costs

Mobile card readers, terminals and POS systems may come with an upfront or rental fee. Costs vary significantly based on the equipment needed and rental duration.

Settlement fees

Some providers charge extra to transfer funds to your account faster than the standard processing time. If you need quick payments, check the provider’s policy.

Currency conversion fees

If a customer pays in a foreign currency, providers may charge a 1% to 3% or higher conversion fee. If you process a lot of foreign transactions, compare providers to find the best rate.

The cheapest card payment methods

While some fees are unavoidable, there are ways you can reduce costs by choosing the right payment method – whether in person, online, by bank transfer, or over the phone.

In-person transactions

If you run a shop, bar or restaurant, in-person transactions are inevitable. And, because they carry a lower fraud risk, they are one of the safer ways to take a payment, meaning providers often charge lower fees.

To keep costs down further, consider buying a mobile card reader for a one-off fee and using a pay-as-you-go provider. This can avoid long-term contracts and rental fees.

Online transactions

If you work online and rely less on face-to-face sales, online transactions can be cheaper. You don’t need hardware, and many providers offer pay-as-you-go pricing, so you only pay when you make a sale.

However, you need a payment gateway – a service that securely processes card payments by transmitting transaction data between your business, the customer’s bank and the payment provider. Gateways charge a percentage per transaction, sometimes alongside bank fees. That said, some all-in-one services bundle these costs into a single bill for ease and potential cost-cutting.

Phone transactions

Mail order/telephone order (MOTO) payments usually carry the highest fees due to the risk of fraud. If your business relies on phone payments, you may have limited options.

To reduce costs, consider an online payment provider that supports MOTO, as this can be cheaper than using a dedicated phone payment system.

Bank transfers

Bank transfers generally avoid transaction fees, making them a cost-effective option. This can work well if you’re a freelancer or a service-based business, but it may not be as convenient for customers making quick, one-off purchases.

Pay-as-you-go versus subscription models

Most providers offer two types of payment models: pay-as-you-go and subscription. This comparison can help you decide which model might work best for your business.

Pay-as-you-go

Advantages

Lower upfront costs: No set-up fees or long-term contracts, making it budget-friendly and flexible
Only pay when you sell: No fixed monthly fees, so costs align with income
Best for low-volume businesses: Ideal for startups, freelancers, seasonal businesses and market traders who don’t process high transaction volumes

Disadvantages

Higher per-transaction fees: Businesses often pay more per sale than with subscription-based models
Less predictable costs: Monthly expenses fluctuate, which can make budgeting harder
Limited advanced features: Some providers restrict access to extra services, such as invoicing or detailed reporting

Subscription

Advantages

Lower per-transaction fees: Monthly fees often mean reduced transaction rates, making them cost-effective for high-volume businesses
Predictable costs: Fixed monthly fees can make budgeting easier
Best for high-volume businesses: Ideal for retailers, hospitality businesses and service providers with consistent transaction levels

Disadvantages

Fixed monthly costs: You pay a fee even if you don’t process many transactions
Long-term commitment: Some providers require contracts, limiting flexibility
Potentially higher overall costs: If transaction volume is low, monthly fees may outweigh any transaction rate savings

Five tips to reduce credit card processing costs

Now you know how to reduce the costs associated with card payments, here are five tips to keep in mind:

Compare providers: Rates and fees vary, so shop around for the best card payment solution based on your transaction volume and business type
Use the right pricing model: Pay-as-you-go typically works best for low-volume businesses, while subscription plans are better for high transaction levels
Minimise chargebacks: Clear refund policies and strong fraud protection help reduce costly disputes
Keep security up to date: Using fraud prevention tools and keeping any hardware up to date can prevent extra fees caused by security breaches
Encourage lower-cost payment methods: Offer bank transfers or debit card payment options to avoid the higher fees

FAQs

Is there a free way to accept credit card payments?

No. However, some providers offer low-cost options with no set-up or monthly fees. While transaction fees still apply, these options can lower the overall cost.

Do businesses get charged for accepting debit cards?

Yes, though they generally pay lower fees for accepting debit cards than credit cards. Debit card transaction fees can range from 0.2% to 2.9%, depending on the payment provider. Some might charge a fixed fee per transaction instead of a percentage.

What is the cheapest way for a small business to take card payments?

The most cost-effective method for small businesses is using a pay-as-you-go provider with no monthly fees, as this avoids upfront costs and only charges per transaction.

For online payments, use a payment gateway that doesn’t require expensive hardware or long-term contracts. For in-person payments, consider purchasing a mobile card reader with a one-off fee and opt for pay-as-you-go pricing.

Both options avoid upfront costs and charge only when you process a sale, ideal for small businesses with low to moderate transaction volumes or if you’re just getting started.