If you’re in the market for small business financing, small business credit cards may interest you. In fact, small business credit cards have become one of the leading ways to finance a small business in the current economy. According to the Small Business Credit Card Survey conducted by the National Small Business Association, more than 86% of small business owners use credit cards to fund their business expenses. Small business credit cards can be one of the simplest types of capital to obtain, especially for startup business owners. If you’re considering obtaining a small business credit card, it would be wise to know how to choose the best business credit cards. Choosing the best business credit card can be done by comparing the features and benefits of the card that are most suitable to your small business needs. There are at least 3 ways you can choose the best business credit cards, they include:
1. Finding out the introductory interest rate – Does the small business credit card have a low introductory interest rate? Typically, the best business credit cards have low introductory interest rates of 0% to 3%. This will allow you to make purchases on the card without paying the normal interest rate for the first 6 to 12 months.
2. Finding out what perks and rewards are offered – Are you a small business owner who travels often? How about a small business owner that needs certain services completed that will contribute to the operation and growth of the business? If so, choosing the best business credit card is critical. There are many small business credit cards that come with perks and rewards. These perks and rewards can include discounts on airplane fare, automobile rentals, gift cards, hotel stays, and services such as marketing consulting.
3. Finding out if your business credit card usage will report to your personal credit – This is the one everyone else forgets, and it’s actually the most important. Do you want to separate your personal credit from your business credit? Do you want a business credit card that doesn’t hurt your personal credit profile and doesn’t lower your FICO scores? If so, then you’ll want to pick the right business credit card. Capital One, for example, reports their monthly activity for all their business credit cards to the personal credit report of the card holder. This violates rule #1 – that means that the Capital One business card is EXACTLY like a personal credit card from a credit perspective.
If you are interested in determining what will be the best business credit cards for your small business, we may be able to help. Our Small Business Finance Advisors are experts in the small business credit card arena. They know which lenders are the right ones and which ones are not. They know which lenders report to your personal credit and which ones don’t. If you’ve considered applying for a small business credit card, you may want to speak with one of our experts so they can help you make the appropriate decision. Feel free to contact us today for more information.
Photo credit here