When times are lean, or payments are slow, many contractors turn to credit cards to help float their expenses. But certain credit cards might fit the needs of the construction industry better than others. The good news is that we did the research for you, collecting the eight best credit cards for contractors in one easy-to-peruse article.
The credit challenge for contractors
Let’s be honest: Payment challenges in the construction industry means that contractors are constantly forced to float expenses while they wait to get paid. Between slow-paying owners and general contractors, schedule delays, and other general hiccups, there can be a lot of stress on a contractor’s bank account.
Occasionally, construction businesses need a little help making ends meet until the next progress payment comes in. That’s the nature of the industry. But keep in mind: Credit cards are not a cure-all for cash flow problems. Using a card to keep your head above water while you have receivables piling up can actually end up increasing your costs.
Read first: The construction business guide to getting paid
When used wisely, the right credit card can help contractors earn points and rewards can actually strengthen their bottom line. Different cards provide different benefits — not all contractors have the same needs or wants. There’s no “best” card for everyone, so we broke them down into categories, depending on what you’re looking for.
The 8 best credit cards for contractors
Below is a list of the best credit cards for contractors when they need a bit of extra breathing room — or just want to get a little extra back. You’ll find benefits like cashback and sign-on bonuses, and points that you can use for rewards.
As a caveat, credit rates can fluctuate based on credit history and other terms. All we can offer is the window your rate will be in if your application is approved. But remember, while a credit card can buy some temporary room when payments are slow, it’s best to pay off the balance every month to avoid paying interest at all.
Best credit card for unexpected expenses
American Express Blue Business Cash Card
Benefits:
- Annual fee: $0
- 0% introductory APR on purchases for 12 months
- Variable 13.24% to 19.24% rate after introductory period
- 2% cashback on eligible purchases up to $50,000 a year, 1% after that
- Flexible buying power
Contractors have to be flexible, and the American Express Blue Business Cash Card knows it. It features AMEX’s Expanded Buying Power program that allows you to use more than your credit limit to make expensive purchases when they arise. The amount you can exceed your credit limit depends on your payment and credit history, as well as your financial resources and other factors.
You’ll also receive 2% cashback on eligible purchases for the first $50,000 each year. You can leverage that cashback to pay your bill — or put that cash back in your pocket.
Best credit card for an easy cash bonus
Capital One Spark Cash Card for Business
Benefits:
- Annual fee: $0 for the first year, $95/year thereafter
- One-time $500 cash bonus when you spend $4,500 on purchases within the first three months
- 20.99% APR
- Unlimited 2% cash back
- You can spend above your limit
If you’re a contractor with a lot of expenses and the cash flow to handle them, you can really benefit from the Capital One Spark Cash Card for Business. With this card, you’ll receive unlimited 2% cashback, which can easily offset the $95 annual fee. You can even spend above your limit while still earning cashback but without incurring over-limit fees.
Best credit card for contractors who love to travel
American Express Blue Business Plus Credit Card
Benefits:
- Annual fee: $0
- 0% introductory APR on purchases for 12 months
- Variable 13.24% to 19.24% APR after introductory period
- 2X membership reward points on the first $50,000 in purchases each year, 1X thereafter
- Flexible buying power
If you prefer to reap the benefits of your hard-spent credit card purchases for points, check out the Blue Business Plus Credit Card from American Express. You’ll receive 2X points on the first $50,000 in purchases each year, and 1X afterward. You’ll get the most bang for your point with airline miles, which might be particularly attractive for contractors that tend to travel quite a bit.
Best card for contractors’ business travel expenses
Capital One Spark Miles for Business
Benefits:
- Annual fee: $0 for the first year, $95/year thereafter
- One-time bonus of 50,000 miles after spending $4,500 within the first three months
- 20.99% APR
- Earn 5X points on hotels and rental cars
- $100 credit for Global Entry or TSA Precheck
Contractors and construction consultants that find themselves on the road often will get a lot of use out of the Capital One Spark Miles for Business.
This card helps you accrue 5X the points on hotels and rental cars, allowing you to put a crew up in a project-local hotel while building your redeemable points bank in a hurry. Plus, the TSA Precheck credit certainly sweetens the deal.
Best credit card for contractors who like cashback
Chase Ink Business Cash Credit Card
Benefits:
- Annual fee: $0
- 0% introductory APR on purchases for the first 12 months
- Variable 13.24% to 19.24% APR after introductory period
- $750 cashback after spending $7,500 in first three months
- 5% cashback on the first $25,000 each year on office supplies, internet, cable, and phone services
- 2% cashback on the first $25,000 each year at gas stations and restaurants,
- 1% unlimited cash back on all other purchases
If your company tends to work with fewer expenses, the Ink Business Cash Credit Card could be the card for you. It offers 5% cashback on everyday purchases like office supplies, business internet, and phone services. It also offers 2% cashback at gas stations and restaurants, allowing you to make a little back when you fill your tank or take a client out for dinner.
Best credit card for tools and materials
Lowe’s Business Rewards Card from American Express
Benefits:
- Annual fee: $0
- 0% APR for the first six months
- Variable 15.74% to 24.74% APR after introductory period
- 5% discount at Lowe’s on all purchases
- 3X Points at restaurants, office supply stores, and wireless telephone services
- 2X Points at Lowe’s
- 1X Points on all other purchases
- Redeem points for Lowe’s or AMEX gift cards
- One-time $100 cash back upon approval
- Access to Lowe’s ProServices
Whether you love the big-box home centers or not, there’s no sense denying the big benefits you get with the Lowe’s Business Rewards Card from American Express. You’ll enjoy a $0 annual fee and a 5% discount on tools, lumber, and any other purchase at Lowe’s. You’ll also rack up five times the points on office supplies, restaurants, and wireless services — all expenses you’re paying for anyway.
If 5% discounts on purchases and redeemable points weren’t enough, you’ll also get access to Lowe’s ProServices. You’ll be eligible for discounted deliveries, bulk rate pricing, and Lowe’s Business Replenishment Program.
Best credit card for contractors who need flexibility
Plum Card from American Express
Benefits:
- Annual fee: $0 first year, $250/year thereafter
- $500 cashback after you spend $15,000 within the first three months
- Unlimited 1.5% cashback on payments made within 10 days of the due date
- Flexible payment terms
If you’re considering an AMEX card, but you’re worried that you might have to carry a balance now and then, be sure to check out the Plum Card. This card offers up to 60 days to pay off your balance without interest. It also offers 1.5% cash back on payments made within 10 days of the due date, and there’s a deal offering $500 cash back if you spend $15,000 within three months.
Best credit card for contractors with advertising needs
Chase Ink Business Preferred Credit Card
Benefits:
- Annual fee: $95
- 15.99% to 20.99% APR
- 100,000 bonus points when you spend $15,000 in the first three months
- 3X rewards on first $150,000 each year spent on travel, shipping purchases, internet, cable, or phone service, and advertising with social media sites or search engines
- Unlimited 1X points on all other purchases
Getting ahead in the construction industry is tough, and many businesses rely on advertising to get their name out there. Chase’s Ink Business Preferred Credit card will offer 3X points on the first $150,000 you spend of those advertising dollars, provided you spend them with a social media site or search engine. You’ll also receive 5X points for shipping purchases, internet, cable, and phone services, and unlimited 1X points on all other purchases.
Alternatives options to credit cards for contractors
If you don’t like the idea of going with a credit card to help supplement your cash flow, there are other options you could pursue.
Learn more: A Contractor’s Guide to Loans & Financing Options
Line of credit
If you like the flexibility of a credit card but would prefer a lower interest rate, you might consider talking to your bank about a line of credit. A line of credit is a pool of money that the lender agrees to let you draw from as you need it. You can draw from it and pay it back as many times as necessary. The best part is that you only pay interest on the amount you drew, not the total value of the line.
Bank loan
If you need longer payment terms or a larger loan, talking to your bank about a traditional business loan might be worth a shot. The benefit of a bank loan is they tend to have lower interest rates than credit cards. The downside is that you might need to put up collateral, such as your home or commercial property you own, in order to get the loan.
SBA-guaranteed loans
SBA-guaranteed loans are another option for small businesses. The Small Business Administration backs these loans through a local lender, allowing banks to offer better interest rates. SBA loans require a lot of paperwork, and you may be waiting for an answer for quite some time. But it’s a good, low-cost option when others don’t pan out.
Why a credit card is not always the answer for contractors
At the end of the day, getting a credit card can be a smart business decision for contractors — if they use it correctly. By putting regular tool, equipment, or business expenses on a card, you can earn cashback or other rewards that can help your bottom line.
But the truth is that credit cards aren’t a solution to a contractor’s cash problems — they are a patch. If your company is constantly short on cash because you’re having trouble collecting your accounts, running up a credit card balance is only going to make things worse.
Instead, take steps to boost your cash flow and get paid faster on every job.
You might have to do a better job choosing prequalified customers or hire a credit and collections manager to help keep the cash coming in. Most importantly, protect your lien rights on money owed to drastically reduce the amount of time it takes to get paid.