There are many credit facilities that businesses of today can avail, and business credit cards are becoming increasingly popular in this category in recent times. In simple terms, a business credit card is a credit card that can be used only for businesses purposes, and cannot be used for personal or individual purposes. Thus, there is a lot of difference between personal credit cards and business credit cards. Businesses of any size can avail these credit cards and are extremely beneficial especially in the case of small businesses wherein personal and business expenditure can be kept separate by using these cards. When you apply for a business credit card, your personal credit history or rating will be scrutinised along with the credit reports of your business. Did you know that the best business credit cards available in the market today offer a variety of features to businesses and stand out when it comes to their benefits and features?

Best Business Credit Cards

In fact, most of the small businesses employ these cards to making their purchases. Up to nearly 45% of the small businesses reported using them for making business-related expenses a few years back. The rate of usage in recent times has increased manifold owing to newer features and benefits. There is a lot more to business credit cards that you may not know; read on to learn all you need to know about them.

How Different Are Business Credit Cards From Normal Credit Cards?

A business credit card isn’t bound by the norms of certain credit card acts that are very much applicable for consumer cards. For instance, you may get a more stringent timeline for payback here and rates may be increased or raised on outstanding amounts too! This simply can’t be done with consumer cards. However, there are many key advantages from a business stand point with these credit cards and they are:

  • Cash back options may be available on purchases from certain stores. For instance, most businesses purchase from office supply stores and there may be offers that involve cash back when purchases are made from certain stores. Given the nature of expenses from businesses, this is a profitable proposition for both the credit card owner and the card company.
  • Some of the best business credit cards offer large bonuses during sign-up. This is because businesses tend to spend large amounts when compared to individuals.
  • Lots of perks on travel is yet another significant aspect for businesses to have large amounts spent towards travels and trips. A very good business credit card will usually offer access to VIP lounges in airports to facilitate a better travel experience to the business customer.
  • If the nature of cash flow in certain businesses is irregular, the credit card company may offer flexible schedules for repayment of the credit availed. This would be of immense help especially to small businesses.
  • When business purchases are routed via business credit cards, it does become easy to track the expenditure made towards businesses and monitor them easily. This helps in preparing financial statements for tax and audit purposes as well. This is particularly of use in small and midsized businesses. Thus, accounting becomes much easier for businesses with these credit cards.
  • Greater credit limits are allowed in these cases as businesses have a higher spending capacity. Even a small business has a higher spending rate when compared to individuals and thus these cards come with greater limits.
  • The terms of payment can be custom-made to suit your business. For instance, if you own a business wherein the cash flows are unevenly distributed and are irregular, you can get the card company to let you pay in a manner that suits your business. Personal cards don’t offer any such flexibility while with a business card; you can enjoy a program that is tailor made to suit the needs of your company. Choose the best business credit card suited to your business to enjoy friendly payment terms. For example, some cards may allow you to continue having outstanding balances if you shell out a minimum payment and so on.
  • The rewards program for business cards is excellent and most of the card issuers have tie-ups and agreements with other standard services and you can avail them using your rewards programs. It is way better when compared to personal credit cards; use them to your advantage and exploit its advantages!
  • Some cards don’t charge annual fees and even offer cash backs on every single purchase while some offer flier miles and points as signing bonuses.
  • Special discounts on car rentals, travel insurance, discounts on interest when a minimum balance is paid and some cards let you cross spending limits (for a fee of course) too!

How To Go About Choosing The Right Business Credit Card For Your Business?

Small businesses should be looking at credit cards that offer them rewards and benefits that are suited to their style of operation. The comfort of having a financial source when the receivables are late is something that small and midsized businesses look for when they opt to buy these credit cards. You should be looking at cards that offer the best signing bonuses, cash backs, rewards programs, flexible payment options, and facility to have interest free outstanding amounts upon payment of a minimum fee, excellent perks for travel and gifts and so on. Before you apply for a business credit card, consider why you need one and how you would employ it in your business. You should research all available options and go for the one that is most suited to your business. However, keep in mind the following:

  • Business credit cards are more expensive and this is natural too given the amount of flexibility, the credit limits and of course the perks that come with them.
  • Handle your card with care and ensure that you keep it safe and secure. Given that is provides higher limits, it may is wiser to employ it securely.
  • Apart from charging high interest rates, these cards may also come with varying rates and this has to be kept in mind before you choose one.