The small business credit card market is a rapidly growing market in the financial services industry. If you are planning to apply for small business credit cards, see how your reasons compare with those of other business credit card holders:
· There is rightful concern about the high interest rates on business credit cards. If you plan to carry a balance, make sure you find the business credit card with lower interest rates.
· The purchases you make on your business credit cards may qualify for special insurance protections from the business credit card company. In case something turns out wrong with the item you bought by means of your business credit card, and the merchant is not willing to return your money, the insurance protection will cover the amount.
· Business credit cards provide credibility and legitimacy to your business. It is an intangible benefit, but when the business credit card company approves a business credit card for your small business, it gives a signal to other merchants that your business has good, sound credit. A business credit card is a very credible imprimatur.
When you do a lot of travel, · The rewards business credit cards give great benefit.
· For the start-up small business, or one which has a tarnished record, a business credit card allows your business to rebuild a credit or build history. By ensuring that this credit history remains consistently positive, you will establish the foundation for securing a business loan or line of credit should you decide to expand the business in the future. The business credit card is your guaranteed line of credit for now.
· Business credit cards and personal credit cards have similar benefits and rewards. When you have a business credit card, you will have a separate opportunity to enjoy discounts, cash back and rewards points on purchases of the services and goods necessary for your business.
In short, it makes good business sense to have a business credit card or two at your disposal.
· When you have business credit cards issued to your employees, they can make purchases on behalf of your company without advancing their own funds or use the business credit cards when they travel for business. Their use of the business credit cards makes it easier to account for expenses.
· Monthly business expenses are easier to track with a business credit card. The monthly business credit card account statement helps with the reconciliation of the purchases you make on behalf of your business.
· Business credit cards provide credibility and legitimacy to your business. It is an intangible benefit, but when the business credit card company approves a business credit card for your small business, it gives a signal to other merchants that your business has good, sound credit. · For the start-up small business, or one which has a tarnished record, a business credit card allows your business to rebuild a credit or build history. By ensuring that this credit history remains consistently positive, you will establish the foundation for securing a business loan or line of credit should you decide to expand the business in the future. Charges to your business credit cards always count as cash purchases, since your business credit card issuer will take care of paying them shortly afterwards.
· The usefulness of the business credit card statement is not limited to tracking business expenses. It can also be used as a reliable – and acceptable – alternative documentary proof when you prepare your books and your financial reports for income taxation purposes.
· When you charge purchases to business credit cards, you get the chance to enjoy cash discounts. Charges to your business credit cards always count as cash purchases, since your business credit card issuer will take care of paying them shortly afterwards.
