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Business Credit Cards Vs. Personal Credit Card – a Look at the Pros and Cons

admin — Sat, 19 Dec 2009 04:30:16 +0000

Pros and Cons of Business Credit Cards and Personal Credit Cards

In recent years, Americans have readily embraced the practice of ecommerce and cashless transactions. The advent of Paypal, Click2Pay and almost every kind of credit card imaginable has made paper money almost irrelevant.

Cash, in fact, has become the exception rather than the norm. Very rarely do you see people with thick stacks of money inside their pockets, and if you do, it most often is a cause for alarm. In fact, store clerks and tellers have been trained to alert authorities whenever they encounter customers who pay for expensive purchases with cash. But I digress. Going back to the subject of credit cards – that wondrous contraption which allows you to shop with just one easy swipe – its widespread popularity has prompted banks to make this work to the advantage of business owners or the corporate industry.

And why not? Considering the countless financial transactions that a small to medium business makes, running out of petty cash for major or secondary supplies procurement, bills payments, or a host of other business expenses is a common experience. A good number of these entrepreneurs have initially tried using their personal credit cards to cover these expenses, but more and more have been shifting to business credit cards for different reasons.

Would You Choose a Personal or Business Credit Card?

What sets a personal credit card apart from a business credit card, and why is one being compared to the other?

In terms of credit limit, personal credit cards have a lower credit line, while the latter can have a credit limit of up to $50,000. Also, a month-end repayment is compulsory for a personal card, while a business credit card allows you to pay just a smaller minimum amount.

In both cases however, interest rates increase for the remaining unpaid amount which is added onto next month’s card bill.

Let’s Weigh the Advantages

A business credit card, when simply used for important business transactions, can offer a wealth of advantages that would benefit the whole company.

First of all, business transactions of all sorts can arise anytime, and in times like these, the business credit card is the answer to every businessman’s prayers.

A business credit card can help a company overcome challenging financial trials. This paves an easier way to facilitate expansion.

Personal credit cards and business credit cards must be distinguished from another by more features. Business credit cards are much stricter in conducting character reference tests – and require a host of other relevant documentation to be submitted before the actual application processing occurs.

What will happen if you both you use your personal and business credit cards? Simple, you have just made yourself credit card payment overload bait. Unless otherwise specified, you may find telemarketers calling you for different debt consolidation or debt settlement contracts. Worse, you may actually run across some who carry the same Hershey’s Kisses wrappers you have been holding onto for so long.

By: Klye Anderson

Using Business Credit Cards in Business Solutions

admin — Fri, 30 Oct 2009 22:33:38 +0000

If you haven’t yet recognized the benefits of owning a business credit card, it’s definitely a matter worth your consideration. Aside from enabling you to separate your business finances from your personal money, business cards offer more advantages. Let’s take a closer look at some of them.

Build your credit.

As soon as you’ve applied for a corporate credit, it’s best to start building up your credit history with the help of a business credit card. You be already aware of the importance of having a corporate credit. A solid and excellent business credit prepares your business for its future growth and expansion. How can business credit cards help you build a solid credit history?

By using your business card for your expenses and paying off your balances on time, you are showing your worth as a borrower. Aside from timely payments, staying within your credit limit is just as important. Financial experts recommend using only 30% to 40% of your given credit limit but not more than 50% of your credit as this could send a negative impression on lenders.

Monitor your business expenses.

A business card can also help you in keeping track of your business expenses. Take advantage of the online account access that most business card issuers provide. This feature allows you to check on your account at any time without even leaving your office or desk. For a manager who handles a hectic schedule and so many tasks, this is a very valuable option.

You can also use your monthly billing statements as well as your quarterly and yearly account summaries as detailed references to your accounting. When it’s time to file your business taxes, these documents can also prove to be indispensable in determining which of your past purchases can be deducted from your taxes.

Get rewarded for your spending.

Some credit cards for business offer reward programs that can help you save more from your expenses. The basic reward programs for business credit cards are the Frequent Flyer Miles, Gas Rewards and Cash Back Rewards. You can choose a reward card that gives the incentives that complements the nature of your business.

For example, if your business is into a lot of traveling, you can certainly get more benefits from a Frequent Flyer Miles Business Card. On the other hand, if you own a fleet of vehicles that you use in your business operations, a gas reward business credit card may be your best choice. If you’re in a buy and sell business, you may want to consider getting a cash back reward business credit card instead.

Be prepared for unexpected expenses.

With the help of a business credit card, you are ready to take on unexpected expenses at any time. Did one of your customers place an unexpectedly large order at a time when you don’t have cash? You don’t have to refuse this particular customer just because you lack the resources. Instead, you can simply charge everything you need to your credit card so you can deliver this order on time.

Having the option to make purchases instantly and pay them off at a later time is certainly one of the best things about owning a business card. The important thing to remember is to always pay off your balances on time to avoid the risk of credit card debt.

By: Pamela Williams

How to Manage Business Credit Card Debt Properly

admin — Mon, 19 Oct 2009 03:46:58 +0000

Starting up a business involves expenses. For most new entrepreneurs, a loan is a must in order to get the business started. Aside from business loans, additional support may be necessary in keeping up with the production and operating costs. Small business credit cards often provide this much-needed financial assistance to business owners.

Why Get a Business Credit Card Debt

Some people may be skeptical about obtaining cards for business because they are afraid that credit cards may lead to uncontrolled spending and debt. However, business credit cards can be great tools not only in keeping a steady cash flow but also in separating your business and personal finances. With the help of business cards, monitoring your expenses is also a lot more convenient and easy. How can you get the most from your business credit card? How can you avoid credit card debt?

Obviously, proper management and control is needed to avoid the risk of card debt. For instance, some entrepreneurs may be prone to charging their personal expenses on their business credit card but such a habit can easily lead to uncontrolled debt. As a business owner, you need to make sure that your business credit card is exclusively used for official business purposes.

Submitting your credit card payments on time is also crucial if you want to stay away from trouble. It could be tempting to pay only the minimum due even if you have the cash to pay your balances in full. But carrying over your balances from month to month also means paying for the additional interest charges. Thus, to avoid unnecessary costs, make it a point to completely pay off your charges each month.

Business Credit Card Debt Consolidation

But what if you’re already stuck in card debt? What can you do about it? A business owner has two options to solve this problem. One is by acquiring a debt consolidation loan to pay off all existing balances and stop the interest rates from accumulating further. By combining his credit card debts into a single loan, the interest rate is reduced and monthly payments are significantly lowered.

Another way is by getting a balance transfer credit card with low interest or zero interest. This would enable you to pay off all the balances you transferred at a low rate or zero interest. However, take note that the 0% APR is only applicable for a limited time, so you must take advantage of this opportunity by completely paying off all the debts you’ve transferred within the zero interest period.

Any of these two card consolidation options can work but in order to be effective, a business owner needs to ensure that he/she can pay bills without a single delay or miss. It would also be wise to avoid incurring new debts while still working on your repayment. Finally, once you’re done with your repayment, you need to a lot more careful about using your business cards to avoid falling in the same debt trap again.

By: Pamela Williams

Small Business Credit Cards in Today’s Recession

admin — Sun, 18 Oct 2009 11:45:21 +0000

Today’s recession has had an impact on personal and business credit cards. Over the past 1-2 years many any people are receiving letters from their credit card lenders informing them of an increase in interest rates or a decrease in the credit limit.

Small business credit cards can be an additional source of financial income. They also help in keeping other lines of credit open. Using this type of credit card can ensure that suppliers are paid on time while giving the business an interest-free period (float) in order to obtain enough money to pay off the credit card debt. As the recession has begun to deepen, businesses have found that obtaining credit cards for their business has become much more difficult.

The worst thing a new business owner can do is to use their own personal credit card to finance their business purchases. This makes it very difficult to separate business and personal finances, but also makes the individual responsible for the debt of the business. Not a good thing!

Some businesses are using business even credit cards to pay their tax bill, which is tempting as it avoids any fines for late payment. There is however a fee for doing so. Usually, this fee is significantly lower than the penalty would be for not paying taxes on time.

There are still plenty of opportunities out there for small businesses who have good credit record to take advantage of their business’ credit cards. Even though lenders are stricter in their acceptance criteria than in previous years, you should not give up. Before applying for credit make sure that you meet all the requirements for acceptance. Every time your credit is check, the credit score goes down. As a result, only apply for cards when you feel confident that you will be accepted.

By: Ron Lerman

Business Credit Card Dirty Tricks

admin — Sat, 17 Oct 2009 17:30:58 +0000

My system teaches people that the proper use
of credit is the fastest way to speed up your profits
in real estate investing.

And you can use this system no matter what your
own credit score is.

What you must understand is how to use a newly
created business name to go out and get business
credit cards and lines of credit for your real estate
investing activities.

My step by step program shows you exactly how
to do this the right way. So you can get the cash
you need to buy and flip property for a quick profit.

Some people wonder why it is so good to get cash
for real estate investing with this trick.

Well here are a few reasons -

1. No matter how much cash I get with these business
cards, this debt has no impact on my credit score. It
is invisible and will not show up on anyone’s personal
credit report.

2. Low cost to access cash from business lines of credit,
unlike your typical refinance charges.

3. I want to defer any expense I can with a business
credit card until the property is sold, even if that is not
for 5 years.

4. Everyone gets a much better cash on cash return
when you defer expenses with business credit.

5. In many cases my mortgage forces me to make a
principal payment every month. So now I can return
that cash flow back into my pocket without costly
refinance charges every 2 years.

6. And finally, I can triple my cash flow every
month, which lets me purchase more great real estate
3 times faster, and retire in luxury 20 years faster
than the average american!

HERE ARE THE TRICKS —————————

But, you need to know some of the dirty tricks
the credit card companies try to pull on you when
you are following this system.

—some business lenders will randomly pull credit
to see if you are personally carrying a lot of debt as
it relates to your available credit. If you do not
keep most of your debt shifted to the name of a new
business you create you can get a nasty surprise.

The bank will sometimes raise your interest rate when
you begin to carry a lot of debt in your own name. This
is another great reason to keep debt out of your own
name when possible.

—some business credit cards will lock down your line
of credit during the first month you start using it while
they wait for you to make the first payment. So if you
think you will need all the cash before the first monthly
payment is made, just take all the cash out at once
when you get the card.

—and my favorite way to use these cards that no
one else talks about is to transfer an existing personal
credit card balance onto a new business card you just
received.

You can call up the bank that issues you a brand new
business credit card and tell them you want to make a
balance transfer. Then you can give them the account
number for one of your maxed out personal credit cards
and they will put that debt into the business credit card.

This is the best way to make your personal debt
disappear from public records and improve your personal
credit score!!!

Of course you must still pay this debt back the same
as if it was still in your personal name. But when it’s
on your business credit card it’s invisible and your credit
score will jump up!

——————- ——————–

And see why my HOW TO BEAT THE SYSTEM in
real estate investing, is the ultimate NO MONEY
DOWN system that will make you rich quickly.

When you buy real estate with cash from a business
line of credit you are a CASH BUYER, but you have
not used any of your own money for the down payment.

My system shows you how to do this no matter WHAT
YOUR CREDIT SCORE is!

Don’t limit your real estate investing to gimmicks
like creative financing.

Buy anything you want with real CASH. Just go out and
get it using my HOW TO BEAT THE SYSTEM in real
estate investing.

Sincerely, Thomas Kish

President of CashFlowExperts.Biz

By: Thomas Kish

Visa Business Credit Cards

admin — Fri, 09 Oct 2009 22:07:12 +0000

The Visa Business Credit Card is one of the most popular business credit cards serving the business market today. Recognizing that businesses appreciate the need for good cash management, Visa offers business credit cards designed to provide business people with purchasing convenience, cost savings, instant access to credit when they need it and complete, detailed reporting of all business expenses charged to their Visa business credit cards.

Visa business credit cards can be obtained from any one of the many issuers that are affiliated to Visa. The credit card packages are likely to vary from one issuer to the next, but there are certain features that are universally applicable to any business credit card issued under the Visa brand. These universal features, privileges and benefits, will typically include the following:

Auto Rental Collision Damage Waiver

All Visa business credit card holders are covered for damages due to collision or theft, at no added cost. This benefit reimburses you for the costs incurred to repair or replace covered losses on a hired vehicle that you paid for with your business credit card. The only condition is that the vehicle should have been exclusively used for business purposes. When you rent the vehicle on your eligible Visa business credit card, remember to decline if the rental company offers its own collision damage waiver. This will activate your Visa coverage. If the rental company is adamant and insists that you buy their policy, call your benefits administrator. In the case of theft or damage to the rented vehicle, you will first call the Visa benefits administrator before speaking to anybody else. He or she will then advise you how to proceed.

Purchase Security and Extended Protection

The purchase security benefit entitles the business credit card holder to replacement, repair or reimbursement for eligible personal property that you completely paid for with your Visa business credit card (up to $10,000 per claim and up to a total of $50,000 per business credit card holder). Extended protection doubles the original manufacturer’s warranty period. This period is capped at 12 months.

Gifts purchased for others on your business credit card are covered by this benefit. The only challenge is that you will be requested to file a claim, and that the intended recipient will be required to provide documents in substantiation of the claim. You must develop the habit of keeping your copies of the Visa business credit card receipts as well as the store receipts, since these will be required as supporting documents to any claim you may file.

There is a host of exclusions on the items or situations that are not covered by the Visa purchase security and extended protection business credit card benefits, so you should review these with care.

Travel Emergency Assistance

Visa business credit card holders are assured of 24-hour assistance from appropriate emergency services when these are required. The benefit covers you, your immediate family members and your business associates. This special service for business credit card holders provides contact assistance and referral. You will still be responsible for all costs and expenses incurred with the suppliers of these emergency services, which could include ambulances, doctors, hospitals and towing. The upside is that you can pay for these with your card as the vast majority of emergency services know and accept the Visa brand.

By: Richard Gilliland

Business Credit Cards and Business Debt – A Dangerous Combination

admin — Fri, 09 Oct 2009 08:38:28 +0000

Does your business rely on credit cards for working capital? A recent study conducted by the Ewing Marion Kauffman Foundation shows that almost 60% of small businesses relied on credit cards to provide funding for operation during their first year. The study concluded that reliance on credit cards to finance the early years increased the likelihood that a business would be in the 50% of startups that failed within 4 years.

Amazingly even a debt as small as $1000 made a significant difference in a company’s ability to survive past the 5 year mark. The pattern for credit card use show an increase in debt over the first 5 years of operation. It is those companies that start to pay down that debt by the end of their 4th year or so that are the ones to succeed. The extra burden of paying off the credit debt is often too much for some young companies who might otherwise have succeeded.

The increased use of credit cards for small businesses is a result of the ease in which cards were obtained even up to 2 years ago. They are easier to get than business loans or lines of credit… Of course there are many other factors that impact a business’ ability to make in these tough economic times, but the use of credit, even in small amounts, early on seem to take their toll.

Unfortunately, the new laws that recently went into effect for personal credit cards do not impact the business credit card industry. This report reinforces the need for the same kind of reforms for the users of business credit as there are now for personal credit. As I mentioned in a previous Ezine article from June, if you use your personal cards for business and have more than a $25,000 limit with a high balance, your personal card may be viewed as a business card and exempt from the personal credit card laws.

Are you still using wither personal or business credit cards for your business? Are you able to pay them off or are you running an increasingly large balance each month? Keep yourself out of that 50% who go under by making a conscious effort to decrease you dependence on credit cards for things you can pay cash for. Work to decrease those balances and make sure you don’t lose your shirt!

By: Linda Adams

Business Credit Cards Guide

admin — Thu, 01 Oct 2009 17:10:00 +0000

Business credit cards are a helping hand for those entrepreneurs who are running their own businesses. A business credit card not only acts as a line of credit but can also help to provide you enough control in managing your companys finances and cash. When business credit cards were first introduced it was mainly aimed towards corporate executives. However, this trend has changed and nowadays even small business owners can acquire business credit cards fairly easily. Business credit cards have become a versatile tool which allows business owners to utilize effectively over time as their business needs change.

A majority of the business credit cards come with a wide range of features including cash advances, cash rewards, airline miles, one-call emergency service, and insurance coverage. The features included in a business credit card vary from one card provider to the other, but most of the credit card companies offer an attractive introductory rate for the first few months from the date of opening your account. After that initial period the customer will be required to pay a higher ongoing APR and the card also might require an annual membership fee.

One of the major advantages of a business credit card is that it provides a significant increase in financial control. The cards allow you to simplify and manage your business expenses well, eliminating the need to use a personal credit card for business expenses. Another most important feature of a business credit card is that small business owners can make use of these little pieces of plastic to provide financing or emergency “bridge loans” for their business when stuck in cash flow shortages. And even thought it is not explicitly stated in the business card features, business owners have made use of business credit cards for start-up funding as well.

Nowadays, there are myriad small and medium sized companies which make use of business credit cards as an efficient financing tool. There is a wide variety of credit card issuers that offer business credit cards with various schemes and features. Because of the many opportunities available, it is highly recommended to thoroughly contrast and compare business credit cards to select the ideal card best suited to your specific business needs.

Tips for Choosing a Business Credit Card

Before you apply for a credit limit on a business credit, make an estimate of your monthly business expenses and your history of repayment. Make sure that you apply for a credit limit that you know is within the bounds of your expense limitations, but equally important, will also take into account the growing needs of your business.

If you have several employees working under you, you need to determine how many cards your business may need and which employees will require cards for business expenses. Obviously, before you issue cards to any employees make absolutely sure that they are trustworthy.

Also, make sure that during this process that you determine your business requirements for ancillary services. That is, if you or your employee has to travel regularly for business needs, then it is a good idea to find out those business credit card issuers who offer free air miles, travel insurance, and hotel discounts.

Be careful about the introductory interest rates offered by business credit card issuers. Most of these offers are designed to entice new customers and after an initial period of six months to one year, the interest rates will increase substantially. So when comparing business credit cards, one of the most important things to check is the regular interest rate versus the introductory APR and which card compares favorably in that regard.

So if you are planning to start a new business venture, try to utilize the entire suite of benefits that a business credit card offers that can fund, track and reward your business activities.

By: Robert Alan

Easy Business Credit Cards

admin — Thu, 24 Sep 2009 05:41:13 +0000

In today’s economic climate, it’s hard to find credit for anything, especially business. Sure, it may be hard to get something for a personal line of credit, but if you’re starting a business, you’ll find that it’s even hard, but I’ll show you some ideas, and steps that you can take in order to find a business card that suits your needs.

Compare banks: Just because you apply for one card, and get denied, doesn’t mean everyone is going to think the same way about you. Instead, try out 5-10 banks, before you give up your search. If you find after 10 applications, you keep getting denied, you may want to try different options, in terms of funding.

Go personal: You don’t necessarily need a business credit card for your new start up, but instead, get a regular card. I don’t recommend this route, but you’ll find that it’s easier to get a card instead of a business card. You may find also that you already have a credit card. You can use this card, and then write it off as you make purchases for your store, etc.

Go prepaid: If you have the cash, you may not need credit, but you may need a card for your employees. If this is the case, you’ll want to look into getting a prepaid card for your staff. These are great because you can load money onto them, and your employees will have a set spending limit. This way, they won’t be able to abuse the system.

Try some of the tips, and you should find that if you follow them, you can find a card that works great for you, and your new company.

By: Tom Tessin

New Business, New Credit Card

admin — Sun, 30 Aug 2009 00:12:17 +0000

So you’ve decided upon the idea and thought long and hard about the name – now it’s time to get your new business up and running. You may have an amount of capital from investors, which needs putting into a business account. It’s also now time to seriously consider applying for a business credit card that can compliment that initial capital investment.

Many new business owners are unsure as to why they might need a business credit card. Surely it’s just as easy to put any funds into a personal account and run the business from there? Unfortunately, this couldn’t be further from the truth. Separating personal and business finances should be a priority for all new business owners. Not only will it minimise the amount of paperwork necessary during accounting periods, but it will also look far more professional to the Inland Revenue Service when it comes to submitting accounts. Business credit cards also offer spending reports, allowing you to identify spending habits – an advantage which most personal credit cards do not offer. Having separate accounts makes finances easier to manage and also makes it far simpler when it comes to things like declaring expenses – something that the majority of employees have to do at some point. In addition, you can request further credit cards for employees; a facility that is not possible with a personal credit card. These cards can have spending limits attached to them and transactions can be tracked online to ensure that all employee spending is necessary and within the set limits. In addition, the business owner can see exactly what has been spent, even if an employee forgets to submit the appropriate receipts.

A business credit card also allows a new business to qualify for particular deals and discounts that are designed with companies in mind. These can include perks such as reward schemes on certain products and services or offers on Airmiles or travel insurance. These benefits can be particularly advantageous to small and medium-sized businesses if the card is selected with the perks in mind. For example, a business whose employees travel a lot might choose a card where travel insurance is discounted.

The security offered to a new business through a business credit card is also a very important factor. These cards offer protection against fraud, theft and there are even capabilities that offer protection against employee misuse. Card security can give the new business owner far more peace of mind and prevent unnecessary expenditure in the event of the ever-present threat of Internet fraud or ID theft.

The most vital aspect of a business credit card for a new business is the credit itself. Credit can be used for a variety of reasons, not least of which is managing the company’s finances during times of restricted cash flow. As the credit does not touch the business’s cash account, supplies can still be bought and services paid for whilst you’re waiting for customer balances to be settled. Of course, the APR and monthly repayments have to be considered, but there are plenty of introductory offers out there to suit even the most lowly of beginnings and these are often matched by cheap rates once the introductory offers have expired. Using credit also helps to build up a company’s credit rating and opens the door for further business credit and greater sets of benefits and perks.

It may appear easier to simply trust your company finances to your personal credit card, but the advantages of a business credit card specifically designed for your business needs are obvious. Business credit cards are designed specifically to deal with the stresses and strains demanded by a company. A personal credit card is not. Finding the right business credit card for you is a process of elimination, comparing and contrasting the deals on offer in the marketplace. With over 500 business credit cards available, comparison websites are an extremely useful resource to help you make the right decision and provide your company with a practical, useful and valuable asset.

By: Hannah Callen