Top Vendors for Small Business Credit Cards

Business Credit Cards: Rates and Formalities With Corporate Credit Cards

Using a small business credit card can be a great way to keep your business growing even when you can’t pay for certain expenses out of pocket. Whether your company needs some help getting off the ground, or you’re already in business and need to buy equipment, you need to know how to manage your business credit cards.

Keep Your Accounts Separate

Even if your small business is just starting up, it is essential that you open a separate bank account for your business, especially when it comes to credit. Mixing business and personal banking can quickly get your finances confused and your lines of credit tangled. Here are some reasons to keep your business and personal banking completely separate.

• As a small business owner, you should always be looking to project a professional image in your business dealings. Having checks or cards linked to your personal account might cause investors or potential clients to question your credibility.
• Charging personal expenses to business credit cards complicates bookkeeping. If you try to deduct certain “business” expenses come tax time, the IRS could find you suspicious.
• Keeping your lines of credit helps protect each of them. If your accounts aren’t closely tied to one another, it can help keep your credit scores high.

To ensure all accounts are separate, consider signing up for a business checking account, as well.

Compare Rates and Rewards

The great thing about business credit cards, especially for small business owners, is that they often offer flexible rates and rewards. In order to take advantage of these deals, seek out credit cards specifically geared toward small businesses.

• Based on your business’s credit score, you could be eligible for lower rates. Do your research to make sure your bank is providing you with the best deal.
• Business credit card points or rewards can be used to pay for various business expenses like travel costs, provide cash back, and offer discounts on other products and services.
• Businesses that use their credit card regularly can take advantage of monthly payback rewards, which make it more affordable to borrow on credit.
• Be sure to check for hidden costs or fees when signing up for a card. A card that offers a $100 reward every month isn’t cost-effective if it charges you $150 in fees.

Maintain Your Credit

Though there are many credit card horror stories out there, using a business credit card doesn’t have to lead you into debt. As long as you use your card properly and stay on track with you balances and payments, small business credit cards can provide you with funds when you need them.

• Paying all your monthly business expenses (including rent, utilities, etc.) on your credit card will allow your business to monitor all monthly expenses in one account and build your credit score.
• Limit the number of credit cards you use for business to one or two- preferably one. Though sign-up discounts or rewards may be tempting, you don’t want to have more open accounts than you can keep track of.
• It’s better to use a smaller percentage of a large credit limit than a large portion of a lower limit. Each time you spend above 50% of your limit, your credit rating can suffer.

Getting a business credit card is an essential step for professionally establishing your business. Many cards are designed with small business owners in mind, so be sure to find the payment plan and rates that is right for your company.

If you’re interested in business credit cards, you may also want to look at business loans and equipment leasing.