Using a Business Credit Card for Basics
In a small business, there can be lags of time between payments from clients in which available funds can be tight for basic expenses, such as office supplies or a client luncheon. That is when a business credit card can be an essential part of business – to keep you going until “pay day.”
However, you may also choose to purchase office equipment on a business credit card even if you have the cash in the bank to cover it. Because some credit cards offer a buyer protection plan that will often be better than the product manufacturer’s warranty. This gives the business owner peace-of-mind when making a major purchase.
If you need a few computers or file cabinets, you can’t get long-term credit at stores. Usually, unless it’s a large equipment purchase, no store will offer payment arrangements. So, a business credit card will allow you the option to buy the item and pay it off over time instead of putting all of the cash up front. Often, you can obtain a credit card with a lower interest rate than most business loans.
In addition, if your business expands to involve employees who travel or need frequent petty cash advances, a business credit card would ease the need to keep cash on hand and give the ability to track their expenses closely. It also makes for more exact accounting so that expense reports cannot be manipulated or padded.
Many credit card statements give breakdowns of expenditures as well, which will aid with planning for each year’s budget. These breakdowns can also make tax preparation easier for your accountant.
By investing in a business credit card, the company is establishing a credit rating that will aid them in the long run – especially if expansion is in the future plans. Dun & Bradstreet regularly rate businesses on their creditworthiness and the better the rating, the better that company’s image is in the business world.
Quick Tip #1
Although it may be overstated, there is a lot of truth to people ruining their credit score due to missing payments and
paying their credit card bills late.The fees can pile up and the interest rates can grow before you know it.
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Quick Tip #2
Never let your cards go out of your sight and always check your receipts and your card statements thoroughly.
These are simple ways to prevent credit card fraud happening to you. If you do see a suspicious credit card statement,
then call your credit card company straight away and cancel your cards. |
Quick Tip #3
Today’s cards offer a wide range of excellent features, including frequent flier points, programs that bank points toward a new car
and cards that support charitable organizations. Other options worth having include car rental insurance coverage, trip cancellation coverage
and extended warranty coverage. |
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