Credit Card Stacking: What Is It And How Good Is It For My Business?

Key Takeaways

1. Credit card stacking is an excellent way to improve your business credit score.
2. The process can be done by working with a professional stacking company.
3. You should have a personal credit score of 680 at least or higher and verifiable income before starting the process of credit card stacking.
4. It can provide many benefits for businesses, such as access to more financing options and better loan terms.

One of the critical challenges of running a business is its sustainability. When starting your journey as an entrepreneur, you must carefully plan every step. Wrong decisions can be fatal for you and your company.

7 Figures Funding will explain credit card stacking and how to use it to your advantage. So, whether you’re just starting or you’ve been in the business for a while, read on for some helpful tips!

What is Credit Card Stacking?

Credit card stacking is using multiple credit cards to finance a purchase. This can be done by using multiple cards simultaneously to pay for the purchase or by using one card to pay for the purchase and then using another card to pay off the first card. Credit card stacking can be a helpful way to finance a large purchase or to avoid paying interest on a purchase by using a lower interest rate card to pay off the balance of a higher interest rate card. However, it is essential to be aware of the potential risks associated with credit card stacking, such as incurring multiple late fees or being unable to pay off the balance of one or more cards.

To explain how stacking up credit cards works, consider the following example,

You have three credit cards with a $5,000 limit on each.

You need to make a large purchase for your business that costs $15,000.

You can use all 3 of your credit cards to finance the purchase. It is stacking because you use multiple cards to finance the purchase.

Benefits of Credit Card Stacking for Businesses

Many benefits come with stacking your credit cards, especially if you’re a small business owner. Here are some benefits of stacking that can help your startup.

1. Financing Large Purchases

As a small-scale business owner, there may be times when you need to make a large purchase but don’t have the cash on hand to do so. It is where credit card stacking can come in handy.

If you have multiple credit cards, you can use them to finance a large purchase without having to pay for it all upfront. It can be beneficial if you need to make an expensive purchase but don’t have the cash flow to cover it immediately.

2. Earning Rewards Points

Another benefit of credit card stacking is that it can help you earn reward points more quickly. If you use multiple lines of credit, you can rack up points faster which can be redeemed for things like travel, cash back, or gift cards.

These benefits can benefit the business owner who often makes large purchases.

3. Building Your Credit Score

Credit card stacking can help you build your credit score using credit responsibly. Each time you make a purchase and pay it off on time, it reflects positively on your credit report.

Eventually, this can help you qualify for better interest rates and terms on loans and other lines of credit. Better financing would be available to your business, which could help in future growth.

4. Access to More Credit

Multiple lines of credit can also give you access to more credit overall. It can be helpful in several situations, such as if you have an emergency expense and need to tap into additional funds quickly.

It’s also helpful if you plan on larger purchases, such as property or a car, for business purposes. Having multiple credit cards can help you get a larger loan amount approved.

5. Fraud Protection

Another benefit of having multiple credit cards is that it can help protect you from fraud. If one of your cards is compromised, you can still use your other cards while you wait for the issue to be resolved.

Additionally, it can be difficult to spot fraudulent charges if you have much activity on one card. Multiple cards can help you keep a closer eye on your spending and quickly spot unauthorized charges.

6. Reduced Cash Flow Issues

Credit card stacking can also help reduce cash flow issues. You can make smaller payments on each card every month when you have multiple cards. It can help free up some of your cash flow so you can use it for other business expenses.

Is Credit Card Stacking a Scam?

Some startup owners are hesitant about the finance option of credit card stacking as they deem it a scam. However, this is not the case. So long as you make your payments on time and don’t exceed your credit limit, you will not be scammed. Credit card stacking can be a great way to improve your business’s finances.

How Do I Start Stacking Up Credit Cards?

If you’re interested in credit card stacking, you can take the aid of a professional stacking company. Here are some criteria to consider before applying.

1. You should have a personal credit score of 680 at least or higher. It will help the stacking company to identify the right credit card companies for you.

2. You have verifiable income. It is to make sure that you can afford credit card payments.

3. Your business bank statements for the past three months will be required.

The stacking service would provide guidance and support throughout the process to ensure you get the most out of your credit stacking journey.

Also Read: Business Loan Requirements For Small Business Owners

Bottom Line

Credit card stacking is a great way to rebuild your business credit and access more financing options. It can be done by working with a professional stacking service or following the above steps. 

If you need to find a professional stacking company for your small business in Phoenix, AZ, 7 Figures Funding is the right choice. We can help you get prequalified to move forward with your business goals. With our years of experience in business funding and credit card stacking, we know how to secure the best rates and terms on your loan. Get in touch with us today to get started.

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