Having quick access to sufficient liquid capital lets your business make necessary purchases and payments to stay flexible in this changing market situation, fulfill urgent financial needs and grow business operations effectively. Whether you are a small business owner or running a well-established company with hundreds of employees, you can reap the incredible advantages of having a business credit card. This not only helps you keep business expenses separate but also gives you quick access to a higher credit limit that can be used for a variety of business expenses and payments.
Best business credit cards usually come with perks like attractive sign-up bonuses, category spending bonuses, and free reward points. In this blog post, we will shed light on some solid reasons to get a business credit card and how it can help you streamline business finances.
Finance Business Purchases and Streamline Cash Flow
Business credit cards are designed to provide business owners with a line of credit that they can use to finance a variety of business purchases and expenses. In absence of a card, the business owner or manager will need cash or a balance in the bank account to afford such purchases. Using a credit card for business expenses and payments helps you fulfill the quick financial needs of the business without having an impact on the business budget. This streamlines cash flow and keeps business operations running smoothly without facing financial issues. Some business credit cards offer introductory interest-free financing for small businesses so they can finance purchases without paying a single penny towards interest.
Convenience
It is very much easier and more convenient to carry a business credit card than to carry cash or a checkbook when it comes to making a big-ticket business purchase. You can use the available credit limit to pay for inventory, utilities, or other business needs. Credit cards are very useful for online purchases and payments. This allows businesses to enjoy a cashless environment without involving cash in any business transaction. Even some purchase transactions cannot be completed without credit cards. That’s why having a business credit card is important for any type of business apart from its size and nature.
Easier than Loan Qualification
Just as with personal credit cards, the process of applying for a business credit card is simpler and faster than obtaining a business loan. This is particularly useful for businesses with no credit history or significant collateral which is usually required for loan approval. Just choose a reliable credit card company and apply for the right card as per your individual business needs. Online platforms like Credit Card Compare also help you choose the right business credit cards with enticing perks and benefits.
Access to Account Management Tools
Some business cards allow businesses to get quarterly or annual transaction summaries so they can stay on top of business expenses and spending. While some also come with the ability to download and integrated transaction history directly into accounting systems like Quickbooks and MS Excel. This makes business accounts and expense management a lot easier for accounting professionals. Business credit cards can also be managed by business owners using an account dashboard or mobile app. In this way, they can manage their cards and transactions more efficiently without using third-party tools and solutions.
Keeping Business Expenses Separate
Using the same card for both personal and business expenses is tempting and offers greater convenience. But it can have an extreme impact on your business and personal finances by mixing them all at a place. This is where getting a separate business credit card enables you to keep a separate and organized record of business transactions for later convenience. This makes business expense tracking easier and there is no need to list them all manually. You can get a monthly statement to view and tally your business expenses with other books for better record keeping. Or you can use an app to track expenses even while on the go.
Business Perks (purchase protection and extended warranties)
Businesses’ needs are different from consumers. Some credit card companies offer expense or transaction management features to keep your business accounts updated and some offer employee cards to stay on top of employee spending habits. Some best credit cards come with amazing perks like purchase protection and extended warranties to offer greater financial protection. These cards provide a great way to get coverage like mobile phone protection so you don’t need to pay for a smartphone you have ordered and find it damaged or lost before it is delivered to you. This helps you save a lot of business bucks whenever you order some products via a business credit card. However, you should read the fine print carefully to check the purchase protection terms and conditions.
Building Company Credit
Maintaining a good credit card payment history is one of the best ways to improve the credit score of your business. As improving personal credit scores help you get a personal loan approved easily at relatively lower rates, building company credit also enables you to get business loans or rent property on better terms. All you need to do is pay your monthly balance in full before the due date. Using a 30% of available credit limit is also recommended by experts as it contributes a lot towards building good credit. When your business has built a good credit score, personal guarantees may not be required for applying for a business loan or line of credit.
Conclusion
Since business credit cards offer myriad benefits and financial perks, it is always a good idea to shop around and pick up the right card that is best suited to the financial needs of your business. So, make sure to compare available offers and choose one that fits your needs. Getting a credit card is not enough to reap the benefits it offers, but you should follow all the terms and conditions to avail perks and benefits communicated. Paying your monthly balance in full is very much important to use your business card effectively and ensure you are not building credit card debt.
For more information and tips to help you choose the best credit card in NZ, visit our website Credit Cards Compare.
