Owning A Business Credit Card
July 28, 2008
As a business owner, you already know that a business credit card is an absolute must for your business. Since not every vendor or supplier, at least not these days will open a revolving account for your company or be willing to extend a line of credit to your firm, a business credit card is an essential piece of equipment for your business. Whether for arranging for business trips (booking hotel rooms and flights, etc.) or simply ordering merchandise or supplies online, a business credit card is an absolute necessity for your company.
So how do you get a credit card for your business? There are several viable options, first you can go to the bank that you do your business banking with. They will often times reward your loyalty with better rates than other credit card companies. Then you can always go online, there are many good websites that will give you one place to browse and compare credit card offers from several different companies. You can also watch the mail for offers because as a business owner the credit card companies are constantly trying to get your business.
Before applying for a credit card for your business from any provider, you should first check the fees and the interest rates on offer from each company. Some companies will charge you annual rates to use their card - these can be very expensive. Interest rates are equally, if not more important; a lot of providers will charge a low introductory interest rate and then raise it later. You should be aware of the length of this introductory period and know what the rates will be after this introductory rate has expired.
You’ll also want to know about each company’s late fees, over the credit limit fees and other charges which may be assessed. If you travel internationally on a regular basis in the course of your business then you will also need to know how fees will affect any purchases made abroad. Also look into reward programs offered by the credit card issuer - sometimes these rewards can be a great boon to your business.
Cash back rewards are a commonly offered incentive. You will have a certain percentage of your purchases made over the year credited back to your account at the end of the year. Airline miles are also a common reward; these can be very useful if you need to travel for your business frequently. Other credit card providers will even allow you to choose from different incentive programs which they offer, which lets you decide which one will best work for your business.
Next thing that you need to know is that as the owner of the business you are going to need to personally guarantee the credit card for your business. This means that along with the company’s information you are also going to need to provide your personal information such as annual income and social security number. Guaranteeing a business credit card is simply co-signing for the company and means if for some reason the company cannot meet its financial obligations then you will personal be responsible for the debt. If you have strong credit then it should not be a problem for you to be approved.
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