Taxes, Lawyers, Business & Debt
Credit Cards For Small Businesses
It can be difficult to secure financing for your small business, and getting a loan can often mean putting your home or your car up as collateral. To avoid this, many small business owners are turning to business credit cards, or corporate cards. These cards are easy to get in comparison to a small business loan, and can be a good way to get the startup capital you need. There are many credit card companies out there competing for your business, and all the competition means a better deal for you. Here are some of the benefits of credit cards for small businesses.
- Most of today's business credit cards offer rates that compete with or beat the best rates that a bank can offer, meaning savings on purchases that you make with the card.
- A lot of cards offer balance transfers, which can result in even more savings. If you do not have to pay interest on balances transferred to your new card for a while, you will definitely save some money, which can be put right back into your business.
- A business credit card adds a layer of security. For online purchases, it will be a lot harder for identity thieves to get access to information such as your name, Social Security number, and address.
- Most business cards include travel insurance at no cost to you, and most allow you to order additional cards that you can dispense to employees.
- These cards allow you to track your spending with itemized statements- great for staying on top of your tax deductions for the year.
- You can save money when you use your business card, as most banks assess a hefty fee for writing a business check.
- Business credit cards help you build your business' credit history, in the same way that personal credit cards do. Your business has a credit history and rating, the same as you do personally, and the credit rating of your business will affect its ability to get loans.
- There's a certain air of prestige that only a business credit card can provide. For example, if you're hosting a business dinner, they will notice that it's your business name on the card. Having one sends a message: that you are a professional and not just dabbling in the business.
There's only one real disadvantage to having a business credit card. Unlike with a personal card, you can easily overspend and end up deep in debt. Treat your business credit card like you do your cash; every time you make a purchase, deduct it from your amount in hand. That should help you keep your spending in check and your debt manageable.