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Small Businesses Benefit From Credit Cards

Jun 6, 2008
There are quite a few ways in which your small business can benefit from a credit card. Of course you can charge things you can't pay for right now but that isn't the only benefit you will get from it. You just never know what will come your way so you have to be prepared. You don't want to have to shut down business for a few days until someone pays you. Instead you can use that credit card to keep you going until the money is there.

Since your business is a separate part of your life than your person finances you need to keep it that way when it comes to what you buy as well. Always have a business checking account and credit card that you can use to pay for business related items. It will make tracking your expenses much easier.

It the eyes of other people and other lenders, the fact that you have initiated some form of credit for your small business says a lot. Statistically more than half of all small businesses will shut down during the first year. Lack of income and lack of planning are the leading reasons for this. With a business credit card it shows you plan to stay around and that you have a plan of action when you don't have money readily available to use.

Even if you don't need to use the credit card, you should for some business related expenses. This way you can build up a history of buying things and paying them off. The secret is to do so before you get any interest rates tacked on though. The issuer of the credit card will see you are responsible and offer you better deals in the way of lower interest as well as increase your credit limit.

Once you do so you pay off that credit card balance. Try to keep your balances low so you will have the credit you need available should something come up. Always stay on top of what your credit card balance is for the business. Be very selective in what you decide to charge on it. You only want it to be necessities so make sure you have a clear understanding of what they are.

The biggest issue to remember is that you don't want to have your personal information or assets tied to that business credit card in any way. Some credit card companies will tell you to do so in order to get a lower rate. This may be tempting but it can lead to problems with your personal finances if your business doesn't work out. You want it to be able to stand alone so work for that from the very start.

There are many great credit cards out there for small businesses. Take your time to explore what each of them offers. Some have terrific rewards programs associated with them. Others have low interest rates, decent credit limits, and no annual fee. Evaluate what each of them can offer for your small business.

There are many different ways that your small business can benefit from having a credit card. It can take some effort to secure one but that is all part of the process. If you are going to have a very successful small business you will need to rely on various types of credit from time to time. Getting a business credit card is a great way to lay a foundation to start building on.
About the Author
Robert Bain - veteran business owner shares his thoughts on getting corporate credit, even if you have bad personal credit. Visit href="http://www.corporatecreditpower.com">CorporateCreditPower.com to read more.
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