Having a credit card especially tailored for business use is one way to help businesses run more efficiently.
Aside from a secure and convenient method of payment, a business credit card
with a suitable credit limit will help with cash flow management, pay for business-related expenses and track purchases. While some business owners may use a personal credit card for business expenses as well, it may get complicated for tax purposes. A business credit card avoids this pitfall as it keeps personal and business expenses separate.
Since businesses are always looking to keep costs down, it makes sense that the business credit card selected should be cost-efficient, practical, and provide at least some benefits or rewards for its use. Several business credit cards are available with rewards programs that will help you earn points that you can redeem for cash back
, free flights, hotel stay, merchandise, points
or other incentives and service discounts.
Some business credit cards will offer buyer protection against faulty merchandise or theft, which is a welcome advantage. Of course, business credit cards
may have restrictions in place, which makes it essential to check the terms and conditions on them before making your selection.
Check to see if online access is available; make sure there are fraud protection measures in effect such as a zero liability guarantee against fraudulent use of the account. Make certain you are aware of what sort of insurance coverages (if any) are included with the business credit card and what transactions they apply to. Importantly, compare cards on the annual fee and the rate of interest
, as they may differ significantly depending on reward structure or incentives being offered.
In choosing a business credit card make absolutely certain about payment terms. As is the case for most personal credit cards, a balance is built up over the month and your statement requires that you pay off a minimum amount at the end of the billing cycle. The balance that remains unpaid is charged a predetermined amount of interest, which is why some customers with sufficient funds prefer to pay off the entire amount owing.
Some business credit cards, often referred to as charge cards, require the full amount to be completely paid off each billing cycle or else fees may be applied. These business credit cards are more suitable for companies with the financial means to always be able to clear their balance.