Best no-fee business credit cards for UK businesses
A no-fee business credit card helps keep your costs low. Discover the options available and alternative ways to fund your business finance needs.
0
min read
A no-fee business credit card helps keep your costs low. Discover the options available and alternative ways to fund your business finance needs.
0
min read
A business credit card can be a sensible first step for building up a credit profile and improving your company’s cash flow management. But are there really business credit cards with no annual fee? And what’s the best no-fee business credit card?
Let’s take a look at how credit cards for small businesses work, and why having no annual fee is a distinct advantage when you’re starting out as a new business.
A no-fee business credit card is a card that offers no annual maintenance fee for holding the card. These no-fee cards work just like a regular business credit card:
Why is having no annual fee an advantage? When the business credit card has no annual fee, this reduces your fixed overheads – something that’s particularly helpful when you’re a startup or smaller businesses with limited cash flow.
Be careful, though. It’s important to watch out for other charges, such as late-payment fees, interest on balance and charges for foreign currency purchases.
Yes, you can get a business credit without any annual fees. But it’s important to check if the ‘no fee’ benefit is permanent, or just a promotional offer.
Some banks will offer business credit cards that waive the fee for the first 12 months only. After the first year, you’ll then need to pay an annual fee to use the card.
Look out for other ad-hoc fees too. You may be charged for foreign transactions, cash advances and late payments, even if there’s no annual fee for the card.
If you’re looking for a business credit card with no annual fee, there are plenty of no-fee credit cards to choose from in the current UK market.
The card that’s best for your business will be defined by the specific needs of the company. But there are some stand-out no-fee business credit cards to consider. We’ve picked three different credit cards to demonstrate the features to look for when reviewing your credit card options.
Note: Information accurate as of 01/07/25.
The Barclaycard Select Cashback Business Credit Card is a no-fee business credit card from one of the world’s biggest credit card providers. Unlike cards from some of the Big Four banks, there’s no annual fee for the entire life of the card. This contrasts with the ‘free for the first 12 months’ offers that are common with many banks.
Here’s a rundown of the main features:
The Capital on Tap Business Credit Card comes from this UK-based challenger in the credit card marketplace. Founded by two startup owners who found it difficult to access credit as a growing startup, this no-fee card aims to support new businesses by extending a line of credit to manage your company’s expenditure.
Here’s a rundown of the main features:
The Metro Bank Business Credit Card is a no-frills, no-fee card that could be ideal if you just need a basic card to open up a line of credit.
Here’s a rundown of the main features:
All three of these business credit cards offer no annual fee, but it’s worth noting that the additional features, tools and benefits vary greatly.
It’s vital to do your homework and to look at the features, benefits and terms and conditions for the card, before you sign up for any no-fee credit card.
When choosing the best no-fee business credit card for your business, it’s important to explore the whole market, especially cards from new challenger providers.
Look for the features that add most value for you, at this stage in your business growth. And check there are no additional fees when using the card.
Here’s a quick checklist to guide your research:
If you use your no-fee business credit card to make purchases in a foreign currency, some card providers will charge you. But the good news is that there are business credit cards that offer zero foreign transaction fees, especially from the growing number of digital banks and specialist providers.
For example, the Capital on Tap Business Credit Card we mentioned above offers no foreign exchange fees with their basic no-fee business credit card.
If you’re using overseas suppliers, or make plenty of trips abroad on business, having zero fees for foreign purchases is a major bonus.
Always check whether the ‘no foreign transaction fees’ benefit is a permanent offer, or only available for an introductory period. And be aware that some ‘no-fees’ business credit cards do charge for foreign currency transactions.
Many no-fee cards offer extensive additional benefits to card holders. Features like cashback on purchases, loyalty points when travelling, or discounts on business services and suppliers are all common bonuses.
Always check what extra features your card offers and make sure you’re proactive about maximising the potential value these offer for your business.
To get the best from your card:
No-fee business credit cards tend to offer interest-free periods of between 42 to 56 days. During this period, if you pay off the accrued balance in full, you pay no interest. But the interest rates on credit cards with no annual fees do tend to be higher – this is how the banks and credit providers make money from offering the cards.
However, there are business credit cards with annual fees that offer lower interest rates on your balance. For example, the Lloyds Bank Business Credit Card requires a fee of £32 per cardholder after the first 12 months, but offers a low interest rate of 14.9% on purchases you make (accurate as of 01/07/25).
In some circumstances, this can be a good way to spread the debt and manage your credit balance more sensibly.
So, how do the two kinds of credit cards compare?
Your decision needs to factor in your cash flow style and how long you want to have this debt on the books.
Not all businesses will be eligible for a no-fee business credit card. Banks and credit providers will want to see evidence that your company is creditworthy and a viable business before they will extend a line of credit.
Requirements typically include having :
Some lenders will offer business credit cards to startups based on personal creditworthiness, if the startup has little or no credit profile. But this will require you having a solid personal credit history and no red flags like previous insolvencies etc.
Other providers may require a minimum trading period or projected revenue statements, so the bank can fully understand your ability to make repayments.
Digital-first providers, like Capital on Tap, are typically more startup-friendly.
Once you’ve been approved for a business credit card with no annual fees, it’s a good idea to be sensible with your credit usage and to manage the card professionally.
Common errors from new card users can include:
Although no-fee cards don’t charge an annual fee, many do still charge foreign transaction fees. These fees can typically be 2–3% of the purchase cost, so it’s important to limit your foreign purchases if transaction fees will be charged.
Some specialist cards offer both no annual fee and no foreign transaction fees — but they’re less common. For example, the no-fee Metro Bank Business Credit Card offers free foreign transactions for purchases made in most European countries – but will charge 2.99% on transactions made in the rest of the world.
No-fee business credit cards are a great way to manage your day-to-day business expenses, especially when spending is frequent but relatively small. However, there will be occasions where you need specific funding to boost your working capital.
Short-term business loans are a good way to access larger lump sums, especially for one-off costs like stock purchases, equipment upgrades or bridging cash-flow gaps.
Knowing the distinction between a business credit card and a small business loan helps you decide which is better suited to your current business needs.
Let’s look at the key differences:
For larger funding needs, or when cash flow timing matters, a short-term loan might offer more predictable repayments and lower total costs.
At iwoca, we know the importance of fast, straightforward access to working capital, especially when your business is at a pivotal point in its growth cycle.
Our Flexi-Loans make it easy to take out a short-term loan, whether you need funding for expansion, or capital to reinvest in new equipment.
With a Flexi-Loan, you can: