Should you get a business credit card?

There are all kinds of reasons why a dedicated business credit card makes sense, from separating company and personal expenses, to reward schemes, free purchase and travel insurance, credibility and more. Find out how a dedicated company credit card as well as other kinds of cards can help your business.

You own your own business or you’re planning to start one. One of the biggest issues most business owners find challenging to deal with is the budgeting and management of expenses on a daily basis.

Taking charge of your expenses and business spending can be a great opportunity to impact your bottom line. One of the ways you can help manage your spending is with a business credit card. These have the added value of features and benefits specifically designed for your company such as 24/7 service, travel insurance and special reporting packages.

Separating your business and personal expenses is also important to ensure your personal credit is protected in case your business runs into trouble. For this reason, once your company qualifies for a business card, you may consider applying for one.

Business credit cards also provide a certain amount of creditability to your business and have ever since they were first introduced. When it comes to winning clients and placing orders, a business credit card account makes your company look bigger, more creditable and more confident. This may lead to more business and earn the trust of your customers and suppliers.

Differences between personal and business cards

A business credit card is issued in the name of the business, not you personally. This means that your credit card is underwritten under the businesses name. If, for any reason, your business cannot pay off the balance, your business and even your personal assets may be liable for liquidation. If you don’t want your credit card to be secured in the businesses name, you’re going to have to show the bank that you are financially creditworthy. Lots of cash at hand, assets and net accounts receivable from prior years are examples to boost your standing.

Depending on your credit provider, you can request detailed annual or monthly statements so you can track and manage all your purchases/expenses. These statements are invaluable especially during tax season. Also, depending on the bank you’re with, you may be able to receive finance and insurance discounts.

Many banks don’t allow balance transfers from business credit cards. If you plan to undertake a balance transfer, confirm whether it’s allowed with your financial provider first.

Benefits of business cards

Personal credit cards and business cards may look similar, but are different. Make sure you always shop around for the credit card with the best benefits and features that fit your business needs. Here are some of the features and benefits to consider:

Security and purchase protection
Protecting your business is important. Business cards can provide that level of protection. Most business credit cards provide purchase cover insurance to cover your business on any major purchases put on your card. This provides your business peace of mind. This feature is especially useful when conducting business on the internet or overseas.

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