Best Credit Cards for Your Nonprofit Business Expenses
Every nonprofit needs a credit card, to simplify vendor payments or just to pay for office supplies. Another great benefit of using a credit card for your nonprofit can be establishing business credit – provided you seek out a credit card company that reports to business credit reporting agencies.
In order to find out if a bank reports to business credit or consumer credit agencies on a specific card they offer, you will have to read the small print (and call customer service). A bank may issue a card with your nonprofit’s name on it, but report as if it were your personal credit card; this will not establish any business credit history and even put your personal credit at risk if you have irresponsible group members use your account.
Note that most banks will require a personal AND business credit check anyway, but you have to make sure the bank reports business credit if your goal is establishing business credit for your nonprofit.
Hundreds of credit cards have special deals for nonprofits that can not only make your finance administration easier, but also can save your organization money. In some cases, you can get donations paid back to you from your purchases!
Best small business credit cards
To banks, nonprofits are businesses, large or small. Hence for the small nonprofit or start up, it helps to think of your organization in those terms as well when picking a card for which to apply. You should consider that these cards require good or excellent credit, and you might have to put the card in a person’s name to start with, using your Board Chair’s or your Executive Director’s credit score to qualify.
Often small businesses are forced to do the same, at least until they build a track record with a good credit line. Here are some good small business cards to consider if you can conjure an excellent credit rating.
Please note that credit card companies change their products all the time and some of the offers below may have changed by the time you read this.
- Discover it® Card
If you make a lot of online purchases at common retailers, you might consider the Discover it® Card. It offers 5% cash back on rotating categories quarterly and double rewards in the first year, with no annual fee. If you use Discover’s online shopping system, you can earn up to an extra 20% rewards for popular stores including Best Buy and Walmart.
- Capital One® Spark® Rewards Cards
Capital One has a series of “Spark” cards for small businesses.
- The “Classic” only requires average credit and is a good option for a smaller nonprofit. It has no annually fee and offers 1% cash back on all purchases to help with your bottom line.
- The Spark Cash Select has no annual fee, offers 1.5% cash back along with a $200 cash back bonus on your first $3,000 in purchases. Better yet, if you need to purchase supplies and wait for your grant funding to come through in a few months, there is no APR for practically a whole year, and it can be as low as 12.9% if you have excellent credit!
- US Bank Business Edge®
If you have excellent credit and need to delay the cost of initial purchases, for a startup or new project, an even better offer than the Spark Cash Select is US Bank’s Business Edge card. It offers no APR for the first 9 billing cycles, and then a variable APR of only 11.9-17.9%. US Bank gives you 3% cash back on business purchases such as cell phones, gas, and office supplies, and 1% on all other purchases. It even gives you a 25% annual cash back bonus of up to $250, with no annual fee!
- SimplyCash® Business Card from American Express
For possibly the most cash back of any small business card, consider the American Express SimplyCash Card. It offers 5% back on wireless and office supply stores, 3% cash back on a list of categories of your choice, including shipping costs and media advertising, and 1% cash back on all other purchases. It has no annual fee and a variable APR of 12.24% to 19.24% based on your credit score.
- Chase Ink® Cash Business Card
The introductory rate on the Chase Ink card is 0% for the entire first year, with no annual fee. It offers 5% cash back on basic business expenses such as office supplies, phone, and cable, and 2% back on restaurant and gas purchases. You get a $200 bonus on the first $3,000 spent as well! It is great if you have different levels of employees that need cards, too. It allows you to set limits for different card holders, sends instant alerts for purchases, and provides a mobile app to instantaneously file receipts.
A credit card designed for nonprofits
- Visa® Community Credit Card
A few years ago, Visa introduced a new option of a community credit card specifically aimed at nonprofits. Banks across the United States have embraced it, offering different avenues to establish credit and qualify. Its main benefits include:
- High credit lines.
- No annual fees.
- Help with managing cash flow and expenses.
- Multiple cards for employees.
- Rewards program for nonprofit specific goods and services.
Fulton Bank’s Community Credit Card can be applied for using two years of financial statements only; they look for nonprofits that pay their bills and have a record for mindful bookkeeping and cash flow. If credit might be a problem for you, this could be the card to consider! First County Bank offers the card as well.
Credit cards for groups with little or no credit
If you have no credit history or a bad credit history as well as no financial statements (or bad financial statements), but you want to have some sort of credit option to pay vendors online, you might consider prepaid cards (that function more like a debit card) or cards that take on risky clients.
- Capital One® QuicksilverOne® Cash Rewards Credit Card
Possibly the only drawbacks to this 1.5% reward card that readily accepts applicants with little to no credit history is the high 22.9% APR and $39 annual fee. Capital One will offer you a higher credit line after only 5 months and starts at a 0% interest rate for 9 months! You need to have average credit or no credit history to apply.
- Western Union® NetSpend® Prepaid MasterCard®
Another option is to get a prepaid card which you can get from just about any bank. It functions more like a debit card but with all the security and ease of using a credit card. Western Union’s is a good choice. You can recharge it by adding cash at any Western Union location globally. They won’t check your credit score.
- PayPal™ Prepaid MasterCard®
Similar to the Western Union card, another useful prepaid choice is PayPal, especially if you already use PayPal for your online donations or bank-based vendor payments. The card, issued by Bancorp Bank, even offers cash back on select stores. You can load it via direct deposit, Netspend, or Western Union.
If you have credit, and it is excellent, dozens of good opportunities are available to you, and you probably want to pick a small business based card that can reward you. If you don’t have credit or don’t want to put an individual leader out on a limb for your nonprofit, try a debit-card option or one especially designed to accept nonprofits. Then start charging!
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>> Read more articles by Devon Reeser
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