How to Select a Business Credit Card Company
by Asad Haroon, CEO of InsideUp.com
It is important to shop around when selecting the right vendor for your business credit card. Each credit card company will offer a wide range of benefits, interest rates, fees, cash back options, and more. Using business credit cards makes good sense for several reasons. Your monthly credit card statement provides an itemized listing of all business purchases, many credit cards offer rewards or a percentage of cash back for purchases and some cards allow a company to earn frequent flyer miles. Some companies offer generous credit lines that companies can use for purchases to grow their company.
With so many offers and card companies to choose from, how do you decide? Ask yourself if your business will be able to pay the balance in full each month or if you will pay as funds are available. This helps you determine how important the interest rate is. Are rewards, such as airline miles and cash back options, important to you? If you will be traveling frequently for business, this could be a resounding “yes”! Then look for generous rewards program to help you earn cash back or free airline tickets.
If you are planning on using your credit card for cash advances, make sure you find a company that allows for these and find out if there is a higher interest rate or additional fees for these cash advances. What are the other fees associated with the credit card? Is there an annual fee and how much is it? Always ask if it can be waived for the first year. Make sure that you understand "hidden" costs that you may be required to pay, like increased interest rates or fees if your payment is late.
Also check these items when comparison shopping for your business card:
•Length of Grace Period - the amount of time that you will have to pay off the balance of your credit card before you get charged interest on the balance
•Cash Back and Rewards - The percentage of cash back or rewards and how these are accrued
•Number of Additional Cards – Is there a fee for additional cards for employees or business partners?
•Reporting System - How purchases are reported to the business, including monthly and annual statements.
•Additional Fees - These may include a cash advance fee, balance-transfer fee, late-payment fee, over-the-credit limit fee, set-up fee, return-item fee and more. Make sure you understand each of these fees before signing a credit card contract so that you will not be surprised when the fees arrive on your bill.
As you build your business credit score, and your payments have been timely, be sure to call your credit card company routinely (at least every two years) to see about negotiating your interest rate, fees, or other perks. If they won’t budge, do a quick check for other options available to you. If you need help finding a
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