Tag Archives: Business credit card

Can business credit cards help with cash flow?

If you are an entrepreneur, you will most probably experience a fluctuation of funds. People often start having cash flow problems when they are waiting for money that is due or that was already transferred but has not arrived yet.

In some cases, debtors pay late and can throw your financial planning totally off track. It may be that you had a cash layout for a new job or product and can no longer follow through. There are multiple scenarios where you might require some urgent help with your cash flow, so you will definitely need emergency backup funds.

While waiting for the cash to come in, your overheads must be paid, your staff must be paid and you must also pay yourself. Like everyone else, you have a household to support financially.

In times like these, you need a short-term loan option that is available immediately. This is exactly where the credit card may come in very handy and help you get through the tough times.

Benefits of a Credit Card

If you have a business credit card, it can be a big help. Maybe you are already using it for small expenses, such as stationery or for stocking the staff kitchen. To prevent you from dipping into your cash fund, you can start to use your credit card for travel expenses, i.e. when directors have to fly to other destinations for meetings.

Although a credit card carries an annual fee, it comes with 0% interest on purchases for the first three months, which is good news for your cash flow.

Remember that a 21% APR applies for credit not paid, so it makes sense to stick to payments to avoid the interest if you can.

One of the many benefits of a credit card is that you can carry over your balance to the next month. If you pay your balance in full and on time every month, you get 56 days of interest free credit from the day of purchase, providing even more help with your cash flow.

A credit card not only aids your cash flow, but can also help you save on purchases. Many credit card companies have retail partners that bring you discounts on a variety of daily essentials such as office stationery.

Insurance benefits such as purchase protection, travel accident cover and cardholder misuse are available should you want to make use of them.

You can limit the amount that any one person in your business can spend, thereby controlling your spending.

If you want to apply for a credit card, you need to have a good credit score and you have to be up to date with any current payments that you have. Your expected annual gross income will determine whether you qualify for a card or not.

Bankruptcy and any present or past judgments will not count in your favor. If you have been refused credit in the past this will also not help.

If you pay the outstanding amount at the end of the month in full, there will be no interest charged. You can also choose to pay only the minimum amount.

Cash flow is vital, so click here to find the best rates on loans and credit cards that could help to tide you over if times are tight.

Advantages of a business credit card for business owners

If you own a business and do not have a business credit card, then you must have realized how important it is to have this card for the growth of your organization. Whether you run your business from the comfy environment of your home or own an office space with several workers, having a business credit card will take the operations of your company to the next level, literally as well as figuratively.

When you have a business credit card, it gives your business a kind of perceived legitimacy and you hold a business value in front of your customers and you get a peace of mind. People doing business with you feel that your company has some reputation in the market. If you are doing business from home, a business credit card will change your thoughts from “just having a hobby” to “owning a full fledged business.” Another advantage of business credit card is that you will be able to do business transaction on credit and maintain the business and personal expenses properly and separately. It will also allow your business to grow and expand in future.

In today’s world, business credit card has become so important to such an extent that if you don’t have at least one business credit card, it means that your company is new in the market and has very small operations. Employees working in a big organization will usually have credit cards. If you are an owner of a company like this, having a business credit card will be more like a necessity than a luxury. Business credit cards offer advantages that make the business operations very smooth.

Business credit card can simply the bookkeeping efforts. You can use your business credit card for major expenses like large supply orders, business subscription services and even routing office necessities. This will certainly help in keeping a track of all the expenses when you check the monthly statements of your business credit card. You can also issue a company credit card with a certain spending limit for your selected staff so that they don’t have to run to the owner for approval of the purchase. This allows greater work efficiency in the organization.

Business credit card can improve the cash flow of your business. You can make all purchases on the card and pay it at the end of the billing cycle. This will allow you to have enough petty cash and use it in those places where you cannot use the card. You can also utilize the interest free money during the card’s grace period. You need to make sure that you are paying the full amount within the due dates so that you don’t incur any interest charges and fees.

Business credit cards are not just for large organizations. It will improve your company’s overall financial picture. You just need to use these cards with wisdom and care so that you don’t incur huge business debts.