Having a business credit card is important for growth. It’s one of the easiest unsecured lines of credit to access and use. When you’re in a cash flow pinch, it’s a good backup. You should know creditors require some personal information for approval, but what they require varies. Business owners may be wondering, "Can I apply for business credit card with DUNS number?"
Others may not have a clue what a DUNS number is. Some business credit cards use your DUNS number, corporate tax ID and/or social security number for approval. This guide will touch on business credit, forms of business identification and which companies use that ID to issue business credit cards.
The D-U-N-S Number and Building Business Credit
Not all entrepreneurs are yet familiar with how business credit works. Let’s take a few minutes to review business credit and discuss the DUNS Number. When you obtain debt financing, most creditors begin reporting activity on your business credit. Business credit bureaus also maintain a business credit score. This is important to gain access to more lending options in the future.
Top Business Credit Bureaus
Like with personal credit, certain bureaus collect and maintain data for business credit activities. Whenever a business secures a loan or line of credit, the bureau records it. These records are public, meaning anyone can conduct a search on the business and review their credit activity. Some businesses also add their own information, such as trade references, to their file.
There are several business credit bureaus out there, but the most common are Dun & Bradstreet, Equifax Small Business Enterprise, and Experian SmartBusinessReports™. Dun and Bradstreet is the leader in business credit reporting. Their database holds files for over 70 million businesses worldwide. The company is also creator of the DUNS number.
What is the D-U-N-S Number for?
Dun and Bradstreet, the Data Universal Numbering System, or D-U-N-S number was established in the early 60s. The main purpose is for businesses who want to conduct business with the U.S. Federal government to obtain grants or contracts. Businesses of all types can apply for a separate nine-digit number for each location. The number tracks your D&B business data.
Federal Tax Identification Numbers, Social Security Numbers and Credit
Most businesses have an EIN, also known as a Federal TIN. The identification is required to establish a business entity in the US. Businesses use it to keep up with financial transactions from company to company and internally. This is mainly for tax purposes. Other reasons for a corporate TIN are to:
- Open business bank accounts
- Apply for business licenses/permits
- Establish business credit separate from personal
The social security numbers (SSN) started off to collect and distribute taxes. It has now grown to become a means of identification for many other transactions. It’s connected to your personal credit file and financial information. Even so, growing entrepreneurs depend on it to establish business credit. Most creditors won’t touch startups without a personal guarantee.
How the D-U-N-S Number Relates to Credit Cards
Once you’ve established some business credit, you can work on separating your personal and business financials. To do this, you need to make sure your EIN is setup properly and connected to your business entity. You also need to apply for a D-U-N-S number. The number can connect potential lenders with your business file showing your creditworthiness.
D & B goes through a validation process before issuing your DUNS number. While it only takes about 24 hours, it helps to have accurate information ready for them.
You’ll need the following:
- Name of business as registered
- Any other names or DBA (Doing Business As) for the business
- Business physical and mailing address
- Name, phone number and title of contact person
- Amount of business employees
Business Credit Cards that Accept D-U-N-S Number
If you ask a creditor, can I apply for business credit card with DUNS number, some of them may say "yes." You can get many business credit cards with a DUNS number. That means you won’t have to keep relying on your social security number for business funds. You also won’t have to overextend your personal credit.
Some creditors require a DUNS along with your EIN. Along with them, banks and financial companies, and even SBA lenders use DUNS numbers for their approval process. The real question should be if your business credit file is sufficient to get approved for credit. To make sure you get approved, there are a few things you can do before applying with your DUNS number.
Steps to Establishing Business Credit to Qualify for Credit Cards
If you’re at the step of using your DUNS number to apply for credit, you should have already completed the first few steps.
- Register your business entity (corporation, LLC, anything outside of sole proprietorship).
- Obtain an EIN through the IRS.
- Apply for your DUNS number.
- Get a business checking account. At this stage of the game, you’ll already have one but the new account will be a little different. You will attach not only your EIN, but also the D-U-N-S number. That way D&B will add it to your credit file.
- Get a business savings account. It will help you open more doors for financing. Banks will see the savings account as an asset. That means you may be able to get a secured loan using the collateral.
- Start putting everything you can in the business name. Not your personal or home expenses of course, but things you truly use for the business.
- Maintain good credit activity. Make your payments on time and keep your credit utilization low. Don’t go beyond 30% usage on your business credit cards.
Can I Apply for Business Credit Card with D-U-N-S Number?
By now you know the short answer is yes, if you put in the work to meet the requirements. The first step is working from the beginning to distinguish your business credit from personal credit. Use the steps above to establish a business credit file. Try to work with lenders who will accept your EIN and DUNS versus your SSN. Make sure creditors report your good activity to bureaus.
Consult with an Expert to Start Building Business Credit
It’s recommended that you consult with a business credit expert before applying for any type of business credit (e.g. loans, credit cards and vendor credit, etc.). If you need funding for your business, the best business credit expert will be able to guide you on obtaining startup or working capital and building your business credit history and score in the process.
