Business credit cards can be a good source of money when meeting cash flow requirements of your business. Although they are difficult to get when you are in initial stages of your business but once you have established your business, you can avail all the benefits these cards offer. 2016 credit cards rated include many business credit cards that offer different advantages and have their own requirements.
Some advantages include:-
Earning rewards and points:
Credit cards offer many different rewards for businessmen. You can get points that can be used while making purchases for office supplies, you can pay gas station bills from these points or you can use these points for covering your travelling expenses like air tickets, rental cars, hotel stays and much more. These rewards also offer you club memberships.
Helpful in establishing credit history:
Just as personal credit cards can help you build a good credit history, business cards can also help you to improve your credit score and establish a good credit history if you are making timely payments. This will immensely help you when you will be expanding your business and will need more credit. You can also gain access to other financial products your credit card company is offering like long term loans and credit lines. All these features will help you expand your business.
Proper segregation of personal and business expenses:
They help to keep personal and business expenses separate. You can use your personal credit card for business purposes but your limit will be reached faster and you will not be able to keep track of you expenses. While, on the other hand, if you use business card for business purposes and personal credit card for personal uses, you will be able to distinguish your expenses and spend wisely.
Keeping track of your spending:
Credit cards also help to manage your expenses. Some companies provide latest features where your card will keep a record of your spending and will categorize where to spend more to avail rewards. It will also help you in tax filing purposes.
Setting limits for employees spending:
Latest credit cards can help you define spending limits of your employees. You need to give credit cards to your employees too so that they can spend for business purposes. But it might be difficult for you to keep track of their spending. Some business credit cards provide this feature where you can set spending limits of your employees. So, you cannot track just your own expenses but your employees’ too.
2016 credit cards rated also have some disadvantages like:
Penalties on late payments:
If you are not keeping track of your payments, you will incur a large debt at the end of month. You need to carefully determine where to use your business credit card otherwise, late payments will bring high interest rate and other penalties with them like a bad credit card score.
Higher interest rate:
They usually pose higher interest rates as compared to other loaning options. So, if you are not paying on time, you will have to pay very high interest rates.