Cash is crucial when you are running and managing a business. However, business owners can also rely on other ways of paying for supplies and services. They can do so with the use of a business credit card.
Advantages Of Having And Using A Business Credit Card
Company owners can enjoy various benefits when they have a good business credit card at hand. These advantages include the following:
• Business owners can use the credit card as an alternative for a traditional line of credit or bank loan. This is especially helpful for businesses that do not have an established credit history yet.
• Business credit cards are convenient and accessible. You can use your company’s credit card to fund purchases or to get cash immediately anytime and anywhere. You can even use it to buy materials or supplies online.
• You can use the credit card to pay for some of your company’s financial obligations when account receivables slowly trickle in and your business is short on cash.
• A business credit card can help your company build credit. As long as all your credit card bills are paid on time and you pay more than the minimum amount due, this will help you get higher credit scores. It is also important that you never use the card beyond the credit limit. All of these strategies can help your business attain a positive credit report and enable your company to gain access to loans and lines of credit.
• Some business credit cards also come with numerous incentives that clients can enjoy such as airline travel miles, discounts, and rebates or cash back incentives.
Choosing The Best Credit Card For Your Business
Below are some tips you can keep in mind when selecting and applying for the best business credit card:
• Prior to looking at your available options, you have to determine a few important things first. These include your spending habits and how you plan to pay for charges.
• If you have good credit and plan on paying charges over time and, the bank may offer you low interest or even zero interest rate. Other banks, however, may offer you fixed rates. On the other hand, if you intend to pay in full every month, go for credit cards that offer longer grace periods or great rewards.
• If you or your employees frequently fly for travel, consider getting a credit card with airline mile rewards. If you or your employees rarely fly for business trips, a card that offers cash back would be more advantageous for your company. Other cards even offer benefits for simply using these.
• Lastly, consider the annual fees. Some credit card issuers offer longer grace periods of up to 30 days without charges. If you don’t wish to pay your charges in full every month, choose a card with low annual fee rates.
About the Author:
James Viener is a financial consultant. He recommends reading more about the best business credit cards on the website of HSBC.