3 Common Misconceptions About Corporate Cards for Startups

It’s no secret that difficulty accessing corporate funds is a common challenge for many startups in Canada. Whether you can’t seem to get enough funds for your growing team or are unable to get approved for credit, it’s not as daunting as it seems. We’ve lined up 3 Common Misconceptions About Corporate Cards for Startups in this article to set the record straight with the answers you need.

The Truth Behind Corporate Cards for Startups

Myth #1: All Corporate Cards Are Created Equal

Think again! Corporate cards come in all shapes and sizes, each with its own set of perks and drawbacks.

• Purchase rates vary widely
• Card limits can be generous or restrictive
• Annual fees? Some have ’em, some don’t

Here’s the truth: while traditional banks might take weeks to approve your application (and slap you with high fees), modern fintech solutions are changing the game. Take Float, for example. They offer:

• Quick 3-day approval process
• No purchase rate or annual fee
• 1% cashback on all purchases
• Automated spend management software

So, next time someone tells you all corporate cards are the same, you’ll know better!

Myth #2: Startups Can’t Get Corporate Cards

Rubbish! While it’s true that traditional banks often give startups the cold shoulder, times are changing.

Many startups struggle with:

• Lack of credit history
• Limited collateral
• Perceived high risk

But here’s the good news: prepaid corporate cards are swooping in to save the day. These cards:

• Don’t require personal guarantees
• Have simpler application processes
• Allow you to issue multiple cards quickly

Pro tip: Look for providers that only require an active business bank account. You’ll be surprised how quickly you can get your team spending responsibly!

Myth #3: Personal Credit Cards Make Good Alternatives for Early Stage Startups

Hold your horses! Using personal cards for business is a recipe for disaster.

Why it’s a bad idea:

• Blurs the line between personal and business expenses
• Increases fraud risk
• Complicates expense management
• Doesn’t build business credit

Instead, consider a dedicated business card. It’ll keep your accountant happy and your finances crystal clear.

FAQs About Corporate Cards

Q: Can startups really get corporate cards? A: Absolutely! While traditional banks might be hesitant, many fintech companies offer corporate cards tailored for startups.

Q: Are prepaid corporate cards the same as credit cards? A: Not quite. Prepaid cards use your own funds, while credit cards involve borrowing. Both have their place in business finance.

Q: Do corporate cards help build business credit? A: Some do, some don’t. Traditional corporate credit cards often report to credit bureaus, while prepaid cards typically don’t. Check with your provider to be sure.

Q: How quickly can I get a corporate card? A: It varies. Traditional banks might take weeks, but modern providers like Float can get you set up in just a few days.

The Bottom Line: Corporate Cards for Startups Demystified

Corporate cards aren’t one-size-fits-all. There are indeed tailored built products for Canadian Startups, like Float. Thousands of Canadian Startups like Knix, Neo, and Clutch have replaced their old cards with Float’s solution. See our customer stories and hear what our customers have to say about Float for yourself!

Ready to get a corporate card that let you scale? Book a demo with Float today to learn how we can make this process easier for you as you grow and scale.

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