Owning A Business Credit Card
If you own a business then you know that having a business credit card is not an option, it is a necessity. This is because not all other vendors, suppliers or other businesses that you do business will open credit lines or give you a revolving account. So for times like ordering online or making traveling arrangements, such as booking tickets or reserving a rental car, having a business credit card is crucial.
How does one go about obtaining a business credit card? There are a few different ways that you can do this – the most common is to get a business credit card through the bank which your company does their banking. In many cases, they will reward your customer loyalty by extending you a favorable interest rate compared to other credit card issuers. You can also look online; there are quite a few websites which let you compare the offerings from different credit card providers in one place. Of course, as a business owner you likely receive many offers in the mail as well – so a business credit card provider could be waiting in your mailbox.
One thing you should check before you apply are the rates and fees that each credit card company is offering. These include annual rates as many companies will charge you to be able to use their card and some can be rather steep. You also need to look at your interest rates, many companies offer a low rate to get you to accept their card and then raise the rate, so make sure you take the time to look at what the rates are going to be when the introductory rate has expired.
You’ll also want to know about each company’s late fees, over the credit limit fees and other charges which may be assessed. If you travel internationally on a regular basis in the course of your business then you will also need to know how fees will affect any purchases made abroad. Also look into reward programs offered by the credit card issuer – sometimes these rewards can be a great boon to your business.
A common reward program is the cash back incentive program – in these, a percentage of your purchases over the course of the year will be credited to your account at the end of the year. Some reward programs let you receive airline miles when used for purchases, which can be great for business travel. Some credit card providers will offer several different reward programs and allow you to choose from among them, letting you decide on the rewards program which will be the most beneficial to your company.
Keep in mind that you, the business owner are held personally liable for the charges incurred on your business credit card. Besides your businesses’ information, you will have to provide your own personal information when you apply for the card; you are in effect co-signing for your business and will be required to pay any expenses that your business does not. However, if you have relatively good credit, you should have no trouble securing a business credit card.
Filed under: Business