Small Business Credit Card: Pros and Cons for Your Pharmacy

Small Business Credit Card: Does My Pharmacy Need One?

Inside: Discover all the unique perks of a small business credit card to learn if one could help grow your business. 

Cash flow is key for independent pharmacies. During slow months, do you have a plan to make ends meet? 

A business credit card not only comes in handy for making work-related purchases, but when used correctly, it can also help you establish your pharmacy’s credit history and give you access to new perks. 

Why use a small business credit card? 

A business credit card isn’t a necessity, but there are several personal and professional upsides to establishing one. These are the main benefits. 

More flexibility 

A small business credit card is perfect for those times when unexpected expenses pop up. If you don’t already have a line of credit established, it’s hard to get one approved in a pinch. 

A credit card can be there to help you cover costs at a moment’s notice. When used responsibly, a credit card can be an extension of your cash cushion, giving you more financial flexibility from month to month.

Separate your personal and professional expenses 

One of the strongest arguments for opening a business credit card is so you can separate your personal expenses from pharmacy expenses. While it may seem harmless to make the occasional business purchase on your own credit card, it can be difficult to separate those two categories come tax season

Frequently using your personal card for business expenses may also harm your credit score. If you are making larger pharmacy purchases on a personal card, your utilization rate will go up and that will hurt your credit score. While a business card will also be tied to your social security number, your credit score will be insulated from bigger business-related spending. 

Higher spending limits 

Since your business income is bigger than your personal income, you can typically gain access to a higher credit limit when applying for a business credit card. This means you can use the card to make bigger business purchases and have more breathing room when unexpected expenses arise. 

Better perks

Credit cards specifically marketed toward businesses have different — and often better —  perks associated with them. You may earn points for using your card on shipping inventory, utilities, and even marketing expenses like buying social media ads. Unlike a personal card, a business card rewards you for your everyday expenses, and it may even come with purchase protection. 

You can then redeem these points for business related perks, like hotels, flights, or car rentals for when you go to industry conferences or continuing education events. 

Build credit history 

Just like you, your pharmacy has its own credit score. The score is often used by banks to determine if they want to extend you a loan, and since getting a loan is often extremely difficult for small businesses, you want your business credit score to be as high as possible. 

Opening a credit card for your pharmacy can help you boost your business credit score. Every month when you pay your credit card bill on time, you prove that you are reliable and build your credit history. 

If you want to open a line of credit or take out a small business loan in the future, establishing a business credit card is a great way to build the groundwork for approval. 

Potential pitfalls

The main risk associated with a business credit card is the same one associated with a personal credit card: overextending your credit. 

If you use your business credit card as the main source of funding for the pharmacy rather than a stopgap measure, you risk taking out high interest debt that you can’t pay back. Since the interest on credit cards is typically much higher than other types of loans, only spend as much as you can pay back every single month. 

For bigger purchases, think about seeking out lower interest long-term funding, like a line of credit or a small business loan

If you do decide to use a small business credit card, start with one card. Having multiple cards may mean you have a higher credit limit, but it also increases the chances that you’ll lose track of your spending. Keeping all your credit card expenses on one account will help you know exactly how much you’ve spent every month.  

Also keep careful track of who has access to the card and when it should be used. Most of your employees shouldn’t need access to the card, but if you do decide to share the card information with a manager, set clear expectations about the kind of purchases they should (and shouldn’t) make with it. 

What to look for in a business credit card 

Before you sign up for a small business credit card, do your research to make sure you’re getting a favorable deal. Here are a few things to know before you sign on the dotted line. 

Interest rates 

Interest rates are ultimately what make credit cards so costly. If you don’t pay off your card right in full, a high interest rate can make it hard to dig your pharmacy out of debt. 

When applying for a credit card, look beyond the promotional interest rate. Many cards will offer low or no interest when you sign up with a significantly higher interest rate kicking in after the first year.  

Annual fees

The annual fee is another factor to weigh when choosing the right business credit card. Some cards may have no annual fee, while others may have fees that are hundreds of dollars. 

Annual fees aren’t necessarily a bad thing, and often higher-fee cards come with better benefits, so take into account the potential savings that come along with perks when assessing how much you want to pay in annual fees. 


Know what perks are important to you when signing up for a business credit card. If you don’t travel often on pharmacy business, a card with great airline and hotel benefits might not be the right choice. 

Instead, you may want to choose a card that rewards you for purchasing office supplies or gives you triple points for paying your utility bills. 


A Member-Owned Company Serving Independent Pharmacies

PBA Health is dedicated to helping independent pharmacies reach their full potential on the buy-side of their business. Founded and owned by pharmacists, PBA Health serves independent pharmacies with group purchasing services, wholesaler contract negotiations, proprietary purchasing tools, and more.

An HDA member, PBA Health operates its own NABP-accredited secondary wholesaler with more than 6,000 SKUs, including brands, generics, narcotics CII-CV, cold-storage products, and over-the-counter (OTC) products — offering the lowest prices in the secondary market.

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Elements is written and produced by PBA Health, a buy-side solutions company.

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