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As you start
a business, you'll be paying out money left and right for
various fees and supplies needed to get things going. If you're
expanding your business, you'll most likely be in the same
situation. One of the best ways to handle expenses for your
business, whether they are start up costs or ongoing incidentals
that occur, is to obtain a business credit card. With a
business credit card, you'll have an organized reporting of
expenses in addition to a quick and easy way to pay for your
purchases.
Choosing the
best business credit card takes a little more research than
finding one for your personal use, but the time spent educating
yourself on credit limits, interest rates and repayment options
will pay off in the long run.
Corporate Credit Card or Business Credit Card?
A corporate
credit card has no interest rate, but it does require either a
monthly or annual fee to keep the card. It's a good idea to
find a corporate charge card that offers a single bill for all
the charge cards on the account, as this will save you time and
expense of writing multiple checks to pay for the charges. Just
be sure that the employees who have access to the cards are
using them for business purposes only- and if there is any
question about the honesty of your employees, you may want to
get itemized listings for each card so you can track each
person's usage on a monthly basis.
A business
credit card is not all that different from a personal credit
card. Business credit cards generally have a credit limit, and
minimum monthly payments to pay. When lenders are deciding
whether or not to extend a business credit to a company, they
will look at the business owner's credit as well as anyone
else's credit who will have permission to use the account.
Evaluating Interest Rates
If you
decide to go with a business credit card over a corporate card,
you'll want to pay close attention to the interest rates of any
cards you are considering. While promotional rates that scream
0% APR sound wonderful, don't forget to check into what that
rate will change to once the promotional period has ended. A 0%
interest for six months that later changes to 29% is not as good
as a card that offers an always low interest rate of 8% or so.
Your other possibility is to obtain a card with an introductory
offer, and before the time period ends, transfer your balance to
a new credit card with a 0% introductory offer. It all depends
on whether or not you want to be bothered with the constant
applying and transferring of funds.
If you've
decided to use a corporate credit card, look for a card with a
monthly or annual fee that is reasonable in comparison to the
amount of spending you believe you will be doing with the card.
Also find out what services the card includes, sometimes paying
a higher annual fee is worth the money in return for having
discounts at office supply stores or airlines.
Consider Rewards Programs
Many
business credit cards (and corporate cards for that matter),
offer rewards programs for using their card. Do you do alot of
traveling for your business? It would make sense for you to
look into credit cards that offer rewards in the form of airline
miles, discounted airfare, travel accident insurance, or car
rentals. Do you tend to purchase supplies from a specific
vendor on a regular basis? There are rewards programs that earn
you points or cash back for purchases made at specific
locations, and this makes sense for businesses who make repeat
purchases from that location.
Why not be
rewarded for spending you have to do anyway?
Pick a Card, NOT Any Card
Choosing a
credit card for business use is not a decision to take lightly,
as the card will be a major factor in the amount of money you
spend for your purchases, the ease in which you can track your
business expenses, and the potential for earning free items or
cash back.
This article
is courtesy of Creditorweb.com, where you can compare business
credit cards and www.creditorweb.com
apply for a credit card online.
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