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Small Businesses Don't Need a Business Credit Card... Do They?

Sep 6, 2007
Many a small business owner won't bother to get a credit card for his or her business. Why bother, after all? Checks work, and do you really want to risk getting a credit card for your business? Just one more thing to keep track of.

A business credit card is useful for just about any business. It's good for your business to have a credit history in its own name. And there are other advantages as well.

Expense Tracking

Having a separate business credit card means you can more easily keep your personal and business expenses separate. This is great come tax time, when you need to be splitting out the deductible versus nondeductible items. It's also just good bookkeeping.

Lots of Options

Just as with personal cards, a business credit card comes with plenty of options. You can find low rate cards, rewards cards and so forth. You can authorize various people to use the account, so that if you have a trusted employee, they can easily make business purchases without you having to reimburse them. It can make life much easier.

Easier Purchases

You know how much of a pain it can be going out to buy supplies for your business. If you don't have a credit card, that means using your personal card, a check, or cash. None of these is as convenient as the business credit card, and they add to the challenge of keeping your books in order.

And just like any other credit card, if you really need to carry a balance you can. No need to ask the bank for a loan or carry the debt on your personal card. This allows you to keep the amount you are paying in interest due to your card separate from any interest you may pay on your personal credit.

There's nothing like a credit card for smoothing out your cash flow as a small business. It can help to keep you from falling behind on bills, although you do not want to rely on debt to keep up with all your bills for too long. That's just not healthy for individuals or for businesses. But for getting past short term cash flow issues, there are few easier ways.

Take the time to explore your options. A wisely used credit card can help your business grow more quickly and is a wonderful tool. Don't skip it just because you don't think you need credit for your business. Better to have the credit there for when you do, especially if it doesn't cost you anything to have it there.
About the Author
Stephanie Foster runs http://www.knowyourcreditcards.com/ as a resource for people who want to know more about credit cards. Get more tips on choosing a small business credit card at her site.
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