Credit Card Articles

Selecting a Business Credit Card

16 August 2010 by CreditCardsCo™

When starting a business, it is important to make sure that you put some serious time and effort into selecting business credit card. What you should not do is have a business credit card instead of using your personal credit card. The reason a business needs a separate card is because it makes it easier to keep personal expenses separate from business expenses.

Comparing Business and Individual Credit Cards

One of the things you should know when you are selecting business credit card is that business credit cards are different from personal credit cards. At first glance, the two types of cards appear to be very similar. Both cards come with a maximum credit limit. Both cards accumulate interest, and a minimum monthly payment must be made each month. When you look a little closer you start to notice that there are some subtle differences between the two cards.

The biggest difference between a business credit card and a personal credit card is the way the history of the card is handled. When an individual falls behind on their credit card payments, it has an adverse effect on their credit rating. No such history is kept on business cards.

Difference between Business Credit Card & Corporate Credit Card

When you are selecting a business credit card you will probably notice that some of your applications say that they are for a business credit card while other applications are for corporate credit cards. You should not assume that the applications for the same kind of card. Monthly payments must be made for both cards and there is usually an annual fee. As similar as these two types of cards are, there are also some large differences between the two cards.

The biggest difference between the business credit card and corporate credit card is that while a business card is charged interest, the corporate card has no interest. The corporate business card is a charge credit card. Getting approved for a corporate credit card is usually much more difficult than getting approved for a business credit card.

Don't Forget to Check Out the Cards Rewards Program

When you are selecting business credit cards, you need to spend a few minutes looking over the rewards program connected to the credit card. Once you have your business up and running, you are going to be amazed at just how handy the rewards program can be. If you are going into a business that is going to require a great deal of travel, you will want to select a travel rewards card that offers rewards when the card is used for things like plane tickets, car rentals, and hotel rooms. Cash back rewards are also very popular. Since you are going to be using the business credit card to make purchases for your business it makes sense to use a credit card that will reward you.

Applying for a Business Credit Card

While you are selecting business credit cards, you should not assume that your personal finances are not going to be considered. When you decide that you are going to start a new business, you should make sure that your personal credit rating good. The best way to improve your credit score is by paying off the remaining balance on your personal credit cards. You should also try to close as many of your other loans as you possibly can. While it is unreasonable to think that you will be able completely pay off your mortgage, if possible try to pay off the remainder of your car payment and any personal loans you might have.

You also should not be applying for several different loans, personal or business, while you are also applying for business credit cards. The more credit applications you make in a short period of time, the lower your credit rating will be, and the less likely you will to approved for any credit cards.

In addition to checking your credit history, the company issuing the card will also look into the credit history of any person who is expected to have access to the card.

You should not take the task of selecting a business credit card lightly. The business credit card you choose can have a major impact on your businesses financial future. You want to make sure that you choose a card that is going to make business transactions easy, and one that has a high enough credit limit that you will be easily able to afford all the things you need to keep your business up and running.

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