How can a business credit card grow your business?

A great way to find money to expand your business is by turning to a business credit card. A business credit card can give you the extra cash that you need in order to quickly expand your business or to use it to purchase expensive supplies like new equipment or machinery.

Using a business credit card also helps to establish business credit, which helps with future loans for the business. It is important that you establish business credit in order to separate from your personal finances. You do not want to use your personal credit for business transactions as it does make it difficult for you to separate the accounts, which is needed for IRS reasons.

A business credit card is nicer from a personal credit card as they usually come with larger lines of credit and they also include rewards and lower interest rates. This makes it much easier for you to pay off the credit card.

If this is your first business credit card you may not qualify for one without a personal guarantee. This provides the bank with financial protection against defaults on the credit card. Banks usually require you to tie the card to a personal asset until the business has been able to prove itself worthy of a separate credit line. This is why it is so important that you look for ways to establish business independence and using a secured credit card will allow you to do this. Once you have your first card and you demonstrate financial worthiness, it will make it easier for the lenders to trust you and to feel comfortable issuing you another line of credit in the future or offering you an unsecured credit card.

Business credit cards are not subject to the same consumer protection laws as your personal credit cards are. This means you need to be very careful when opting for a business credit card if it will be tied into your personal finances in any way.

However even with this limited protection turning to a business credit card may still be one of your best options. You need to track your business expenses and one of the best ways to do this is by opening a business credit card. This way you have records of all the transactions and it does make it much easier for you when tax season rolls around and you need to show these documents to your financial accountant.

Having a single card not only makes it easy to track expenses you also have an easy method to pay your expenses. You only need to make a single payment to a credit card versus having several different accounts to pay off at the end of the month.

Check on the interest rate and the rewards that are offered by the credit card lender. Usually business credit cards have much larger lines of credit and better interest rates but you do need to do your research in order to make sure you are getting the best business credit card out there. Your local bank may offer one but their interest rate could be incredibly high compared to that of a larger bank that you can find online.

Consider the rewards offered with the credit card as well. This helps you to justify the card if it has a monthly maintenance fee if you can get 2 or 3 airline tickets out of the account each month. Choose a business credit card that will match your spending patterns and always make sure you keep an eye on the interest rates and fees to ensure you aren't paying more for something that should be helping your business.