How to Decide Whether to Get an Instant Approval Business Credit Card

Maddie Shepherd

Staff Writer at Fundera
Maddie Shepherd is staff writer at Fundera. Beyond her deep knowledge of small business financing, Maddie's specialty is business credit cards—she'd love to help match your business with the credit card that benefits you most!
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When you’re searching for a business credit card, time is of the essence. It’s easy to be intrigued at the concept of instant approval business credit cards—especially when you have emergency purchases to make and little fires everywhere to extinguish.

We’re positive that this ultimate resource for navigating instant approval business credit cards will help. They’re tricky financial waters to wade in, sure, but after this, you’ll be well equipped with knowledge on instant approval business credit cards, what they’re best for, and all of your best alternatives.

OK, First: What’s an Instant Approval Credit Card, Exactly?

Before digging into all things instant approval business credit cards, let’s make sure we’re clear on exactly it means for a credit card to be “instant approval.” It’s not quite as straightforward as it sounds, and business owners look for them for any number of reasons.

Instant approval business credit cards have a seemingly quick approval turnaround. “Seemingly” is the operative word here, unfortunately. Credit card issuers that offer instant approval typically issue a preliminary approval while they do a more thorough underwriting process. And that process isn’t instant.

Additionally, some card issuers might offer an instant approval business credit card in the form of a “preapproved offer.” This means that they’ve performed a soft pull of your credit score and think you might be a good cardholder.

However, pre-approval works much like the preliminary approval we just went over—basically, if you express interest in claiming the offer, the card issuer will continue a more thorough underwriting process before officially extending you credit. And, even after you are formally approved for a credit card, you’ll need to patiently await your card as it travels to you via snail mail.

Not so instant, right. So, although instant approval does mean faster than usual in most cases, and lets you get a picture of what could be a good match for you, it’s not magic. As much as it hurts to say, going into your search for instant approval business credit cards expecting credit in the blink of an eye will only leave you disappointed.

What Kinds of Credit Cards Can Be Instant Approval?

Certain types of instant approval credit cards are only available to those with the highest personal credit scores. Because of their quick, preliminary approval, unsecured instant approval credit cards are really only an option for those that offer the most attractive qualifications for card issuers.

On the other hand, credit cards can also be instant approval if they’re low-risk for the card issuer, making your qualifications as a borrower less pertinent. This means that secured credit cards are often considered instant approval, since many don’t require a certain creditworthiness to qualify for them.

In other words, instant approval credit cards often occupy opposite ends of the spectrum of accessibility. So, while certain unsecured instant approval credit cards have much tougher standards for cardholders, other secured instant approval credit cards get their title of “instant approval” from how easy it is to qualify for them.

The good news? That means you have options.

What’s the Story with Instant Approval Business Credit Cards?

While a few business credit cards are widely advertised as instant approval, they’re almost all secured cards. Generally speaking, if you’re preapproved for an unsecured instant approval business credit card, it’s a highly desirable one, and you’ve got a high credit score that the issuer thinks would qualify you for the card.

For the rest of business owners who aren’t in that position, though, you can find a few instant approval business credit cards that are available regardless of your creditworthiness. And, again, the difference is that they are all secured business credit cards. You’ll have to put down a security deposit of at least 90%—if not all—of your credit line’s worth.

Because they’ll likely require that security deposit, most instant approval business credit cards aren’t much use when it comes to freeing up your business’s cash flow. In fact, tying up your funds in a security deposit is pretty counterintuitive when running a business.

instant-approval-business-credit-cards

What are instant approval business credit cards good for, then? The short answer is simply building credit.

If you lack the personal credit to access other unsecured business credit cards, then an instant approval business credit card might be your only credit option. Accessing a secured credit line with an instant approval business credit card—though it might require a security deposit—provides the opportunity for credit-challenged business owners to spend responsibly and build credit.

Eventually, by building credit with an instant approval business credit card, your credit options will open up to other business credit card options. And maybe, with a little due diligence, you can build a credit score that will make credit card issuers reach out to you with pre-approved instant approval business credit card offers.

Finding a More Effective Alternative to Instant Approval Business Credit Cards

The main function of instant approval business credit cards is building credit now to access better business credit cards later—we’ve got that. But there’s probably a more effective way to do it if that’s what you need.

Maybe you’re already run into this as you’ve been applying for cards, but even business credit card issuers will rely heavily on your personal credit score when deciding whether or not you qualify. In fact, in most cases, your personal credit score will be the only factor in determining whether or not you qualify for a business credit card.

So, why get an instant approval business credit card when your main goal is to actually build your personal credit score? That’s where the secured personal credit card really becomes essential.

For a Better Way to Build Credit, Look to the Capital One Secured MasterCard

If your personal credit is below 550, then your very best option for building personal credit is the Capital One Secured MasterCard.

This secured credit card will be in your name only and, as a result, will be more direct in enabling you to build (or rebuild) your personal credit. Plus, the Capital One Secured MasterCard is one of the most flexible secured credit cards on the market.

While other secured credit cards require that you provide a security deposit of at least 90% of your credit line, the Capital One Secured MasterCard allows for security deposits as small as 25% of your credit limit, depending on your creditworthiness.

And, if you’re unable to pay your security deposit in one lump sum, the terms of this card will also let you pay it in installments, as long as it’s paid in full within your first 80 days of your approval. Even better, unlike many secured cards, this card won’t charge you any annual or hidden fees to build credit with it.

Instead of attempting to open up your business credit card options by improving your credit history with an instant approval business credit card, opt for this secured personal credit card to more efficiently build personal credit.

The Next Step After Instant Approval Business Credit Cards

What will you have to look forward to as you build your personal credit? Business credit cards with even better perks.

If you build your personal credit to at least 550, then you’ll be eligible for lots of unsecured business credit cards that’ll offer you rewards for your business spending. And don’t forget that you can reach that threshold far more efficiently with a secured personal card than with an instant approval business credit card.

The Capital One Spark Classic

To get a more concrete idea of what you’ll be able to access more efficiently by building credit with something other than an instant approval business credit card, let’s take a look at one of your top business credit card choices for fair credit—the Capital One Spark Classic for Business.

This business credit card is available to business owners with personal credit scores of at least 550. As you do your business spending with the Spark Classic, you’ll not only gain access to an unsecured credit limit, you’ll also earn an unlimited 1% cash back for your business spending.

Plus, the Spark Classic reports directly to personal credit bureaus, so as you spend responsibly with this card, you’ll be improving your personal credit score even more. Eventually, by building your credit with the Spark Classic, you’ll be able to access business credit cards that will reward your business spending at an even higher rate.

Before your know it, you’ll graduate from the Spark Classic into a business rewards credit card that’s even more lucrative for your business.

The Bottom Line for Instant Approval Business Credit Cards

After reading through this guide to instant approval business credit cards, you should be familiar with why they seem too good to be true—more often than not, they are.

You should hesitate on jumping on board with any kind of instant approval business credit card not only because they’ll often take just as long to obtain than any other business credit card, but also because there are far better options for building credit.

If you opt to build or rebuild your personal credit by spending responsibly with the Capital One Secured Mastercard, the Spark Classic, or both, then you’ll be on a straight-shot to gaining access to the top business credit cards on the market.

With a little savvy and a few smart credit card choices, your improved personal credit will take you to the opposite end of the instant approval business credit card spectrum—the one where business credit card issuers reach out to you.

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.

Maddie Shepherd

Staff Writer at Fundera
Maddie Shepherd is staff writer at Fundera. Beyond her deep knowledge of small business financing, Maddie's specialty is business credit cards—she'd love to help match your business with the credit card that benefits you most!

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