Last Updated on Apr 7, 2020 by James W

Whether you are the owner of a company with numerous employees or a sole proprietorship, a business credit card can be a source of quick capital. It can also make the process of managing business transactions a lot easier. Although business cards are not all similar, here are some things that you need to know:

Eligibility is based on business/personal credit history

When figuring out whether to approve you for a credit card and the terms to give you, issuers usually look at your personal or business credit history. Although responsible past use will affect your chances the most, you should ensure that the major credit bureaus have the correct data.


The card issuer might also be swayed by up-to-date business licenses and insurance policies; they show that the business you are running is legitimate.

Cards can be issued to employees and employers

Multiple cards can be issued from the same account to be used by your employees. Such cards usually come with a customizable user privilege so that you can decide how much credit you want to give specific employees. Moreover, you can determine where your employees will shop.

You might not be personally liable for debts

Depending on whether the card offers ‘joint and several’ or ‘commercial’ liability, you might not be personally responsible for the debts. ‘Commercial’ liability means that your business will be liable for all debts. ‘Joint and several’ liability, on the other hand, means that you and your business are both responsible for paying the debt. Before signing any contracts, make sure that you understand your responsibilities and rights.

Business cards have higher limits

The credit limit for your business card will most likely be higher than your personal limit. This is because consumers charge less than business owners do. In some cases, business cards do not carry any limit at all. However, such cards carry annual fees, which you might not like.

The terms of payment can be tailored for your business

Because cash flow is not always predictable for small businesses, card issuers usually offer business-friendly terms of payment such as discounts when you pay your balance early or the choice to defer payments if your cash flow is slow. The terms of payment also vary depending on the card you have.


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For instance, the balance on a business charge card is usually due in thirty days and balances on business credit cards will not be due if you pay your minimum payment. Some cards also have an extended payment option that allows you as a business owner to finance a large purchase over time with special terms, not those used for routine purchases.

Rewards can make spending worth it

Whether you are spending money on travel or office supplies, you can find a card with a rewards program that allows you to accumulate points that will go towards these purchases. Some card issuers have agreements with companies that allow you to have discounts on business-related services and products.

Business cards make accounting easier

Having a commercial credit card helps you as a business owner to separate your business and personal expenses. This is necessary if you hope to avoid problems with the IRS. A monthly credit card statement will also enable the business owner to track the business’s spending so that you can cut out any unnecessary expenses.


Moreover, some cards provide a detailed analysis that helps businesses to plan their future expenses. Before choosing any card, make sure that you check reviews for top credit cards for business. By doing so, you will see the cards that others prefer to use.



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