Starting a business is often easy, but the actual hard task is getting a regular flow of clients/customers and working capital. In fact, I have seen businesses struggle to get a regular flow of money, especially when they are new, even though they have a regular flow of clients/customers. When a business has to face something like this, the owners are left with only two primary options: (1) Selling personal property, (2) Taking business loan.
There’s also an another way to arrange quick money – by opting for business credit card. Hence, in this post, I’ll list down the benefits of having a business credit card, and also some famous CCs from Americans Express and other payment cards company.
(1) Earn Rewards & Save Money
Let’s be real here, most of us want to get the best credit card because of the rewards and cashbacks associated with it. And, that’s totally fine. Even companies know that. That’s why they are always in a rush to launch the most rewarding credit card in the market. Keeping aside personal credit cards for now, let’s talk about one of the best business credit cards out there.
American Express The Business Platinum Credit Card. American Express is pretty well-know about how rewarding their credit cards are. The only downside is that it’s not only a bit hard to get accepted into Amex, but also the yearly fee is on the higher side.
Amex Platinum Business Credit Card also falls on the same category. If your business involves a lot of travelling, and other active expenses, then this card will save you some insane money. Of course, it’s nowhere close to the Centurian card, but it has good value.
Here are some of the many benefits you’ll receive from American Express Platinum Business Card:
- 5x reward points on flights and prepaid hotels
- 1x reward points on any other purchases
- 250,000 reward points on spends of $20k within 3 months of issuance
The list of benefits continue from here… If you can use this card for most of your expenses, you’ll receive more bonus than you will ever need. One of the best credit cards out there if you ask me…
(2) Streamline Employee Expenses
Initially you won’t have any employee, but with time as your business grows, you’ll have to hire someone to delegate tasks. And since it’s your business, it will be your responsibility to take care of them. Any expense your employee does for your business will come under business expense. While that’s nice for your employee, It could quickly become a headache for your business bottomline. And, who knows, they can also start spending money for personal expenses…
A business credit card helps a lot in these cases. When your employee uses a business card provided by your company, they cannot use it for personal spending as they will be caught. Other than keeping an eye on employee spending, you also have the access to limit, or block the card altogether if you discover any suspicious financial activity.
Let me introduce you American Express Business Gold Card. Yeah, this credit card is nearly similar to the Platinum Credit Card, but only a step down from the real OG. I have seen businesses getting the Business Gold CC and later upgrading it to the Business Platinum CC. If you’re good at managing expenses, then this credit card will be game-changer for your business.
(3) Easy Financial Tracking
Managing business taxes and other finances is way harder than handling your personal finances. Every businessperson know this. And credit card company know this as well… Honestly, every business credit card today has easy financial tracking option enabled by default.
For tax purposes, you can easily export all expense records to a tax software like Quickbooks and get on with your day. Earlier, it was too much of a hassle, and chances of making mistakes were too high. Hence, if you run a business, get a hold of a good business credit card and make tax filing easy.
(4) Builds Business Credit Score
Timely payments and regularl use helps build your credit score. Anyone holding an active credit card know this one fact. Trust me, managing a credit card is complex. Only a handful of people actually know how to not mess-up with credit cards. That’s why, the first thing an irresponsible credit card holder loses is credit score.
A business card is not much different than a personal credit card, but of course, it’s riskier. Business CCs can build credit scores faster than your usual personal CCs. Which is boon for someone who uses their CCs regularly, and also pays on time.
I don’t know whether you know this, but owning a business credit card can help you get better loans in the future. Unlike credit cards, loans are an integral part of any business. You can grow your business without taking a business loan, but it’ll be incredibly hard. Hence, opt for a Zero-annual fee business CC and gradually increase your credit score.
(5) Receive Travel & Purchase Protection
Here comes the real power of owning a small business credit card. By owning a business CC you’ll inevitably receive travel and purchase protection. This is what makes credit cards so special. Let me introduce you Ink Business Preferred® Credit Card.
This credit card from Chase is pretty famous among not only businesses, but also individuals who opt for business credit cards. Here are some benefits of owning the Ink Business Preferred:
- No foreign transaction fee
- Extended warranty on purchase
- Trip cancellation and interruption insurace
- Cheap yearly fee
Trust me, you’ll immediately know why this card is loved by everyone, no matter whether they are a business or individual. Among all the credit cards I have researched till now, I feel this one is the best CC out there…
(6) Separate Personal & Business Expense
As I mentioned previously, running a business is hard. You’ll have to use various tools and people to keep your business successful. And, when things are so complex and messy, you don’t want your personal life to get involved too… Many people use their personal credit card for various expenses, sometimes even business expenses. It’s a bad practice to do that… Hence, the best option is to have two separate credit cards – one for business and the other for personal use.
Having two different cards have nothing to do with your credit score, or future loan possibility. It’s only about getting rid of confusion while filing for taxes. You’re making things easier for your accountant since they won’t have to separate personal expenses with business expense…
(7) Higher Credit Limits
Yes, how can I forget this one single benefit? Every business credit card has higher spending limit. Because payment companies know that providing a $5k limit would be of no help for most business. Of course, the fee is higher than most personal credit cards, but in return you get more than enough rewards, credit limits, and also some other perks like free foreign currency transaction.
You wouldn’t trust me, but I know business credit card owners who have $1+ million credit limit. They run multiple small businesses and use their company credit card thoroughly. So much so that they get extra gifts from companies like American Express, Visa, and other payment card companies.
But, the funniest thing is that they behave like the millionaire next door. They don’t carry any air of the so-called millionaire lifestyle. Still, here they are, casually using a credit card with $1+ million credit limit.
(8) Tax Benefits
Do you know that interest on business credit card purchase is tax deductible? Since running a business is hard, the Government provides many benefits to attract more people into business. This idea seems to work though… At least for credit card companies.
You can get tax rebate from your business credit card if you can show enough proof of our purchase. As you accountant about it, and see what they recommend you. This is short tip that will help you save a little more money during hard times, or in usual times too.
Disclaimer: All the images of Credit Cards are taken from their respective owners. Createblogearn.com has no active relation with them
