There are many reasons to consider signing up for a business credit card for your company. Whether you are a freelancer, small-business owner, entrepreneur or head of a global enterprise, you can enjoy the benefits of a business card. With business credit cards, you get the benefit of greater payback flexibility and enhanced fraud protection.
A small-business credit card also comes with various types of rewards programs, depending on the card you select. Rewards include travel rewards points to apply toward flights, hotels and rental cars. Other business credit card rewards include points that you can redeem for products or experiences, or you can opt for cash-back rewards that can be applied toward your next payment.
Once you decide that small-business credit cards work for you, there are certain steps you should take to ensure you get the best business credit card.
Step 1: Map Your Spending Habits
Before you select a small-business credit card, you need a clear picture of how much money you spend each month. Knowing this amount provides an estimate on the credit limit size necessary to help your cash flow. If a business credit card only gives you a small credit limit, you may have to learn how to do more with less credit until you build up a credit history with that card provider. Alternatively, you might apply for a business credit card and then lines of credit with various vendors.
Also, consider where you spend the most money each month. For example, if you spend money mostly on business travel, then you would want to get a business credit card that offers you bonus points or miles for those expenses. Or, if you purchase a significant amount of supplies, then you might consider a cash-back reward business credit card.
Step 2: Research Your Card Options
Once you have an idea of your spending habits, then you can start researching what types of small-business credit cards are available. Thanks to the internet, researching your business credit card options is relatively easy. A simple search can uncover recommended lists and guides about available card options.
When researching potential cards, keep in mind how they can specifically benefit your business. For example, look for the business credit cards that help run your company in more efficient ways. Some of the best credit cards provide quarterly and annual spending reports at no additional cost, or options to download statement data directly into your accounting software.
Other factors to consider might be whether or not the business credit card company charges extra for additional business credit cards for employees. Check to see if they charge foreign transaction fees. Also, if you plan on paying for some of your business purchases over time, you should compare APR across business credit card choices.
Step 3: Take Advantage of Sign-On Bonuses
When you receive your business credit card, one of the first things you want to do after account opening is to decide what to do with any type of sign-up bonus offered. The sign-on bonuses might be an automatic reward or you may have to spend a certain amount during a specific period in order to get that bonus.
If it’s a cash bonus, then you want to remember to use it after your first billing cycle. Or, if the bonus featured miles or points, you may want to “bank” those for future redemption when you’ve accumulated more. Either way, make sure you follow the requirements so you don’t miss out on this extra reward.
Step 4: Review All Information About Your Business Credit Card
When you first get your card and take care of any sign-on bonus, you also want to review all the information that’s provided with the card. Credit card companies include a wealth of data about the introductory APR, interest rate changes, annual fees, balance transfer and more.
When researching potential cards, keep in mind how they can specifically benefit your business. For example, look for the business credit cards that help run your company in more efficient ways.
You want to make sure you're getting what you liked about that particular business credit card. It’s also important to be aware of all the potential fees and rate changes that could impact your bottom line and even your personal credit score.
Learn about the security features that your business credit card offers and set up any of the authorizations that can help secure your card over the life of the account.
Step 5: Sign Up for All Automated Services and Apps
When running a business, you may inadvertently forget to pay a bill or need a more efficient way to handle all your transactions each month. More and more business credit card issuers now have their own mobile apps and offer automated payment services.
Take advantage of these services so you can access your business credit card account on the go, track purchases and automatic payments, and monitor employee use.
Step 6: Add Authorized Users
Now that you have your business credit card, you can request additional employee cards and add authorized users. This helps your team members take care of some of the business spending for you so you can focus on other aspects of your company.
Next Steps
Once you know the steps for getting the most out of your business credit card, it’s time to get started. Make sure to watch your membership rewards regularly and keep an eye out for perks like TSA discounts, gift cards, airport lounge access and more.
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The information contained herein is for generalized informational and educational purposes only and does not constitute investment, financial, tax, legal or other professional advice on any subject matter. THIS IS NOT A SUBSTITUTE FOR PROFESSIONAL BUSINESS ADVICE. Therefore, seek such advice in connection with any specific situation, as necessary. The views and opinions of third parties expressed herein represent the opinion of the author, speaker or participant (as the case may be) and do not necessarily represent the views, opinions and/or judgments of American Express Company or any of its affiliates, subsidiaries or divisions. American Express makes no representation as to, and is not responsible for, the accuracy, timeliness, completeness or reliability of any such opinion, advice or statement made herein.
