Wells Fargo Secured Credit Card Review - Small Business Edition

Wells Fargo Secured Credit Card Review - Small Business Edition
Amy Fontinelle
on March 20, 2020
Read in 3 min

No credit history, low credit score, and struggling to get approved for unsecured business funding?

Consider the Wells Fargo Secured Credit Card for Business.

By depositing money in a collateral account, you create a credit line for your business.

Then you build your credit by making timely payments–

All while enjoying the convenience of making purchases with plastic.

Funding OptionsEst. APRMax. Loan AmountMin. Credit Score
Funding Option
OnDeck Capital
Est. APR
Starts with
9%
Max. Loan Amount
$ 500,000
Min. Credit Score
600
Get Started
Funding Option
kabbage_logo_vertical_min
Est. APR
Starts with
24%
Max. Loan Amount
$ 250,000
Min. Credit Score
560
Get Started
Funding Option
blueVine
Est. APR
Starts with
18%
Max. Loan Amount
$ 5,000,000
Min. Credit Score
600
Get Started
Funding Option
Seek_Capital
Est. APR
Starts with
9%
Max. Loan Amount
$ 500,000
Min. Credit Score
680
Get Started
Funding Option
Lendio
Est. APR
Starts with
5%
Max. Loan Amount
$ 500,000
Min. Credit Score
500
Get Started

Who is the Wells Fargo Secured Credit Card for?

The Wells Fargo Business Secured business credit card is a good option for an entrepreneur looking to establish or rebuild credit.

Approval for small business credit cards depends on the business owner’s personal credit history.

So if you’ve never had a credit card or a business loan before, you’ll have to establish personal credit first.

Alternately, if you’ve had trouble paying your bills on time, suffered a bankruptcy, or been foreclosed upon—

You’ll need to improve your personal credit in order to access competitive business financing tools.

Learn more about how to Compare Small Business Credit Options

Eventually, your business might be large enough to generate a separate business credit score, but having good to excellent personal credit will always be an asset.

Our comprehensive reviews make it simple to identify the best credit card features for your small business.

Wells Fargo Business Secured Credit Card Review of Benefits

Option to upgrade to a secured card

Wells Fargo will periodically review your account for a possible upgrade to an unsecured business credit card.

Credit card expert Beverly Harzog says the typical upgrade time for an unsecured card is 12 to 18 months, depending on your credit score.

Upon qualifying for a secured card, you’ll get your collateral deposit back and you can put that money into your business.

Reported to major credit bureaus

Cardholders say the Wells Fargo Business Secured Credit Card reports their payment history to all three major credit bureaus: Experian, Equifax, and TransUnion.

Having your secured credit card payment history reported to the credit bureaus is essential: it’s what establishes or rebuilds your credit.

Business Rewards

The best cash back business credit cards are unsecured cards, but the Wells Fargo Business Secured Credit Card is competitive.

Their Cash Back Advantage program, which offers a competitive 1.5% cash back per $1 spent, enables you to receive your rewards as a quarterly direct deposit to your bank account.

Rewards are unlimited and are the same regardless of spending category.

Searching for a Cash Back Business Credit Card

No foreign transaction fees

The Wells Fargo Business Secured Credit Card card has no foreign transaction fees, so it’s a good choice for businesses whose owners or employees travel frequently and businesses that make regular purchases from overseas companies.

Limited risk

This card limits your spending to the amount of your collateral deposit.

That deposit will be used to pay any delinquent charges on your account if you stop making payments.

With an unsecured card, you might get a $25,000 credit limit when you can’t afford to spend more than $5,000, which could put you and your employees at risk of overspending.

Wells Fargo Business Secured Credit Card Review of Drawbacks

Limited purchasing power

Because your credit line is equal to your collateral deposit, if you can only afford the $500 minimum deposit, you’ll have a small credit line.

If you can afford to deposit the $25,000 maximum, you won’t experience this potential drawback.

You can’t use your collateral deposit to pay off your balance, so choose your deposit amount carefully.

Annual Fee

You’ll pay a $25 annual fee per card for the Wells Fargo Business Secured credit card.

If you have a business owner card plus five employee cards, you’ll pay a $150 annual fee, so only issue cards to employees whose job duties require one.

Searching for a No Annual Fee Business Credit Card?

Collateral deposit doesn’t earn interest

A hidden cost to tying up money in a collateral deposit for this credit card is that it won’t earn interest.

Interest rates are so low that you won’t miss out on much.

But if you could have earned 1.5% on your $10,000 deposit in a high-yield saving account over a year, the $150 in lost interest is like an additional annual fee.

Limit your deposit to the smallest amount required to meet your company’s monthly credit card purchasing needs.

Wells Fargo Secured Credit Card Details

Annual fee: $25 per card.

Employee cards: up to 10.

Grace period: 21 days interest-free on purchases.

APR on purchases: Prime plus 11.90%. (of 1/13/2020)

Balance transfer fee and cash advance fee: determined upon approval and disclosed in customer agreement.

Cash advance APR: 20.74% plus prime.

Credit access line: $500–$25,000, equal to your collateral deposit.


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Amy Fontinelle Finance Journalist

Amy Fontinelle is a writer, editor, and personal finance expert.

Her articles have appeared at Investopedia, Bankrate, MassMutual.com, The Simple Dollar, Interest.com, Yahoo, Forbes.com, SFGate.com, Bankaholic, Mortgage-Calc.com, Saving Advice and other sites.

Amy’s clients include personal finance websites, financial institutions, public policy organizations, academic journals, and professional economists.