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Owning A Business Credit Card
Posted by: | CommentsIf you are a business owner than you know well that a business credit card is not an optional thing; it is nothing less than a requirement if you want to be able to do business. Not every vendor or supplier is willing to extend you a line of credit or offer a revolving account to your business. When you need to order supplies online for your business or make the logistical arrangements for business trips (like renting a car, for instance) it is essential that you have a business credit card for your company.
Image via Wikipedia 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.
For example many reward programs offer a cash back incentive in which they give you a certain percentage of your annual purchases back to you at the end of the year. Others allow you to accumulate air miles on your purchases and this can be very helpful to those that regularly travel. Many companies offer several different types of reward programs to business owners so find one that actually gives something back to your company.
Next thing that you need to know is that as the owner of the business you are going to need to personally guarantee the credit card for your business. This means that along with the company’s information you are also going to need to provide your personal information such as annual income and social security number. Guaranteeing a business credit card is simply co-signing for the company and means if for some reason the company cannot meet its financial obligations then you will personal be responsible for the debt. If you have strong credit then it should not be a problem for you to be approved.
