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Business credit cards make running a business easier, no matter the size. They give a way to access capital quickly and can make processing and managing business transactions straight-forward and simple. This article will go over the important information to know about business credit cards.
To obtain a business credit card your personal and business credit history will be analyzed. Any issuer will look at both your business’s credit history as well as your own to determine what terms you qualify for. To get the best credit card for your business make sure your personal credit history is correct by requesting a free credit report from all three bureaus. You should also check your business’s credit with two business bureaus: Small Business Financial Exchange and Dun & Bradstreet.
Another important thing to understand about business credit cards is your liability for the debt. Your personal liability depends on what the credit card issuer offers, whether it’s commercial liability or joint and several liability. If your credit card has commercial liability your business is the entity that’s liable for debt; the latter means that you and the business are both liable. This is one of the most important things to know about a business credit card before agreeing to the terms.
Next, understand that cards can be issued to both employers and employees under the same account. This allows you to customize user privileges, making sure you can track and regulate the spending of individual employees.
Payment terms can also be individually tailored for businesses with business credit cards. Many issuers understand that cashflow isn’t predictable with businesses and will offer payments terms that benefit you, like a discount for paying early or even deferring your payments if the cashflow slows down. Understanding the payment terms that are offered to you will help you understand how particular business credit cards can benefit you.
Business credit cards also usually have higher credit limits than a personal credit card because business owners often charge much more than a regular consumer. Many business credit cards have no spending limits of any sort, although they may have extra fees associated with them. This can be an important feature for many business owners to consider when applying for a credit card for their business.
Lastly, business credit cards provide a way for businesses to seperate their personal expenses from those that are business-related, making paying taxes much easier and allowing the owner to track spending. These credit cards also frequently have rewards that the account can earn. These rewards are usually earned when your business spends on office supplies, travel and entertaining. You can also find rewards programs that give you discounts on services and products for your business when you use your business credit card.
Business credit cards can be a great tool for small business owners, providing benefits that can’t be found anywhere else. They allow business owners to seperate, track and analyze their spending on expenses while offering rewards and discounts on important products and services. These credit cards also help business owners seperate the debt liability of their business from their own personal debt. All small business owners should consider a business credit card to help run their business more efficiently.