Does applying for a charge card affect your credit score?

How does a charge card work?

A charge card is a type of credit card that requires you to pay the full balance each month. Unlike traditional credit cards, charge cards do not have a preset spending limit, which can be advantageous for managing large expenses. However, the flexibility comes with the responsibility of paying off the entire balance by the due date to avoid late fees and potential damage to your credit score.

What are charge cards used for?

Charge cards are typically used by businesses that have significant monthly expenses and want the convenience of flexible spending without the constraints of a credit limit. They are popular among business owners, frequent travelers, and those who prefer not to carry a revolving balance. Charge cards often come with rewards programs, travel benefits, and other perks that make them attractive for high spenders.

Does applying for a charge card affect your credit score?

Most charge cards don’t require a credit check or personal guarantee, which means they typically won't impact your credit score. However, some charge cards do require a credit check. When this happens, the issuer will conduct a hard inquiry on your credit report, leading to a temporary dip in your credit score, usually by a few points. This impact is generally short-lived, with your score recovering within a few months, assuming there are no other negative factors.

Does applying for Amex credit cards affect your credit score?

American Express (Amex) offers both charge cards and traditional credit cards. Applying for either type of Amex card will result in a hard inquiry on your credit report, which can affect your credit score in the same way as other credit card applications.

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However, Amex has a prequalification process that allows you to check if you're likely to be approved for a card without affecting your credit score. This soft inquiry does not impact your credit score and can be a useful tool for determining your eligibility before formally applying. If you decide to proceed with a full application, the hard inquiry will occur, and your credit score may experience a temporary dip.

Apply for a Ramp Corporate Card with no credit check

At Ramp, we understand the importance of maintaining a healthy credit score. That's why our corporate card solutions don't require a credit check, allowing you to access the benefits of a charge card without any impact on your credit score. With Ramp, you can enjoy flexible spending, valuable rewards, and a suite of tools to manage your business expenses efficiently—all without worrying about your credit score.