Small Business Credit Card Choices
A small business credit card can provide your business with many advantages. There are business credit cards offering rewards including frequent flyer miles, travel insurance, and hotel credits. There are also cash-back cards for small businesses and many of these cards offer discounts or rewards tailored specifically to small business owners such as discounts for business services from shipping to software. You may even want to take advantage of the zero-percent interest rates and no annual fees offered by many cards.
The best business credit cards will offer many advantages. They will help you to keep track of your business expenses with monthly card statements. Using a credit card for your small business can help you with your taxes by providing you with a clear year-end statement. Most business cards will offer higher spending limits than personal credit cards, which can help to free up your business’ cash flow when you use your credit card to make large purchases. Business credit cards can also make bill paying easy with on-line payment options. You can even control and keep track of employee spending without worrying about petty cash or reimbursement accounts by requesting additional cards with pre-set limits. Perhaps the best benefit is that by using a business credit card responsibly, your will be building good credit, allowing for possible future loans as you and your business grow.
Credit card issuers today are targeting small business owners with a wide variety of new credit card programs. When you are trying to choose from the many new credit card options for small business owners, you should consider many factors and compare the offers available.
Naturally, you will want to compare the interest rates offered by the credit card companies. While you may be responsible enough when using your personal credit card and pay off your balances each month, the APR on a credit card for a business owner is more likely to become a factor at least on those occasions when business slows. If your business may make purchases costing thousands of dollars and pay them off over several months, a fixed-rate credit card with a low APR will provide greater stability than a credit card with a variable rate.
You may want to seriously consider a cash-back rewards card for your business. These cash back offers can be as attractive as 5% for office supplies, 2% for gas, and 1% for any other purchases. This can be a great way to cut down on your actual expenses, but read the fine print in the cardholder agreement carefully. If you end up carrying a balance at a high interest rate, this will erase the savings that this type of credit card could provide.
A concern unique to many business owners is foreign exchange fees. Many business owners place orders for items from overseas suppliers, which means that they are more likely than the average consumer to be charged with these fees, which may amount to 3% of the purchase price. You can find credit card issuers that don’t charge foreign exchange fees, but you should ask about these fees before you sign up for the card.
As with any credit card, it is imperative to make all of you payments on time. Just like consumer credit cards, many business credit card companies will immediately raise your interest rates if you make a late payment, even if it is on another loan or line of credit. Business credit card customers need to be as cautious and responsible as any other credit card user in order to get the full benefit of these cards.