Benefits of Using Small Business Credit Cards

Many small business owners find it easy to pay using their personal credit cards during the initial stages of their businesses. While there’s nothing wrong with paying for stuff from your own checking account or personal credit cards when your business is still young, you’ll get to appreciate numerous benefits associated with using a business credit card. Indeed, with budding of new business opportunities, there has equally been a growing popularity of small business credit cards. If effectively managed, especially during these times of ever changing interest rates, a business card can be an important tool for any small business owner. Here are some of the benefits of using a business credit card.

Avoids Mixing up Other Accounts

Using a credit card dedicated to your small business helps to avoid mixing your business account with your personal accounts. You don’t want your business to have accounting or tax problems and this is indeed a good way to prove to Internal Revenue Service that you are committed in the management of your business accounts.

Tracking your Business Expenses

Using business credit cards gives small business owners a better way of tracking their expenses. You don’t want a situation where it comes to year end and you can’t reconcile your transactions. At the end of the year, your credit card company will provide you with a summary of a well itemized statement of all your transactions, averting the nightmare of saving your receipts for tax time.

Accessing Business Loans

Use of a business credit card helps your small business to build trust and increase credibility. A well built business credit makes it easy for banks to go through your account and advance you the money you may need for business expansion.

Separation of Business Credit and Personal Credit

The other good thing about using small business credit cards is that your business credit is rated differently and your business transactions do not have any bearing on your personal credit ratings.

Building Special Rewards

Following high competition in credit card market, many credit cards have developed different rewards and discount programs. These include programs such as business and supply discounts, cash back on all purchases or airline miles among others.

Developing Employee relationship

If you have employed some staff and you allow them to use your business credit cards, you develop a good relationship with your workers as that increases the level of trust between you and them. You may want to be covered by employee misuse insurance for protection against misuse of business finances.

Limiting Employee Spending

Using small business credit card gives you the ability to control how much your workers can spend on business purchases. You can simply do this by giving them cards with preset limits and monitor their spending separately using the statements you receive.

In a nutshell, using small business credit cards presents great benefits to business owners, helping them to streamline their operations, control business spending, increase efficiency of transactions as well as enhancing fraud protection. If you’ve not been using a credit card for your small business operations, then there is a worthy cause to start doing so.

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