Why Business Credit Cards Matter

Business Credit Cards

Credit cards are not only widely utilized by individuals, but also by businesses. According to the National Small Business Association’s 2012 Year-End Economic Report, 31% of small businesses have used credit cards for their capital needs in the past year. It has become basic for businesses to use credit cards for their finances that credit cards are now one of the top loan sources of small companies.

Besides cash flow needs, business credit cards offer more benefits that new entrepreneurs can take advantage of.

Business credit cards help you manage your finances. It is not advisable to use your personal credit card for your business. A separate credit card for business use only is highly recommended;  that way, you can easily track down your business expenses, and you can manage your budget and expenditures systematically. By the time tax season starts, tracking your costs will be easier to handle.

Employee spendings are controlled and reported. Should your employees need to use the credit cards, you can control their purchases and even set a limit on their credit card charges. You may also benefit from the perks that different business credit cards offer; just choose what you think is best for you. For example, Capital One Spark Cash for Business offers a $50 cash bonus by signing up one or more employee cards.

Business credit cards offer higher credit lines. Compared to personal credit cards, business credit cards offer higher spending limits for your expenses. The Wells Fargo Business Elite Card offers up to $100,000, without the $200 annual fee and no additional employee card fees.

Business credit cards offer better rewards. Business credit cards offer so many perks and rewards that the company only needs to choose the right card that will maximize the bonuses. The rewards come in different forms including discounts on office supplies, travel perks, and cash backs. The Chase Ink Cash earns 5x rewards in bonus categories of up to $25,000 a year. If you have a business on the go, the American Express Business Platinum will give you access to over 1,000 American, Delta, and US Airways airport lounges all over the world, plus discounts on airfares, car rentals and hotels.

Just like the use of personal credit cards, having business credit cards will build the company’s credit in the long run. You might not be offered the best credit limit or interest rate at the beginning, but once you solidify your company’s credit standing, you can reap the benefits of credit cards soon. Most importantly, manage your credit card wisely for it is there just as the first step. You have to use it as efficiently as possible and see it is as a contributing tool for your business.

If you would like to read more about how to choose the right credit card features that suit you, this article may help you.

Why Business Credit Cards Matter is an article provided to you by Lansing Economic Area Partnership. You may visit their website here.

 

 

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