When you are a small business owner or the owner of a big company with many employees. Business credit cards can provide many benefits and ease the process of managing business operations and transactions. Business credit cards come with a lot of benefits, even more than personal credit cards. Did you know that you don’t have to own a business to qualify for a business credit card? For instance, you could be a freelancer working from home but still qualify. Using a business credit card can help separate your personal and work expenses. That, in the long run, can help raise your credit score over time. You want to apply for a business credit card for several reasons, and here are things you should know.
1. Payment terms are different for various businesses
Many companies help to build business credit in 30 days in case you need your business to be creditworthy fast. Plus, card issuers are aware of the unpredictable climate that surrounds the business world. Therefore, they will often offer business-friendly payment terms such as extended payment options. Besides, these, let business owners fund their projects over time. However, you should note that payment terms vary depending on the company. The limit of credit card is higher, making it easier to run huge transactions that can otherwise not be run by a personal credit card.
2. A high welcome offer
You are new into the business credit world and want to be sure to maximize on all the perks your business can get. Bringing down costs is one of the key elements in running a business, big or small. Therefore, you can take advantage of introductory bonuses, which can end up saving you a ton of money. For example, you can get an offer of a free three months subscription, free first time flights, or free software for first-time clients. However, be careful when the deal is good to read and double-check the fine print.
3. There are bonus points earnings
As a business owner, take on the discounts they offer for some of the main activities. Just Like personal credit cards have some rewards, many business credit cards earn bonus points on particular purchase categories. Business credit cards are many, but you should make sure that the one you apply for earns bonus points where you will be spending the most money. Also, try as much as possible to customize your bonuses with your needs. Some business credit cards, offer points on huge purchases.
4. Separate business credit cards and personal credit card
It is important to separate your business credit card from your regular credit card. This is to avoid any loops when it comes to borrowing money. You do not want your business credit rating to reflect in your credit rating and vice versa. Besides, when you have a separate credit card for your business, you no longer have to sort out business and personal reports when it is time to return your taxes. Plus, you will also realize that your business credit card has many discounts and benefits, allowing you to operate at low costs as compared to a regular credit card.
5. What happens when you Default?
As a business owner, you should strive to have a good credit score always. This is because all the information goes into your business credit report that can affect your future transactions. Notify the bank, in case you cannot make payments on time so that you can negotiate the terms. Banks and other financial institutions are flexible, and you might learn that they could offer financial relief, especially towards calamities like the current COVID-19. This financial relief can be, lowering monthly payments and interest rates, preventing accounts from going past due or further past due and relief from late payment fees in the future.
To conclude, there are plenty of great reasons why you should apply for a business credit card. Thus, you need to find a business credit card that will earn you numerous bonus points and cash-back plans through the welcome offers and special earning categories. Also, look into good business credit terms that will also save you time and money through various travel and purchase discounts.