A business credit card can be handy in helping small business owners conveniently access funds for their day-to-day business needs. But with multiple options, it can be challenging to choose the most suited card for your business needs.

This article will help you understand different credit card options, including cards for specific outlets like Sam’s club business credit card. We’ll also highlight what to look for select a credit card for your small company.

Different Types Of Credit Cards For Business Owners

1.   Store Credit Cards

Store credit cards limit your purchases to a specific store. It could be a restaurant, hotel, contractor, or wholesaler.

Earlier highlighted, Sam’s Club Business Credit Card is an excellent example of a store credit card.

2.   Cash Back Credit Cards

Cashback credit cards refund from around 1-2% of the amount incurred on purchases made using the card.

3.   Balance Transfer Credit Cards

A balance transfer credit card allows customers to move their credit balances from another card at minimal costs during a stipulated promotional period.

4.   Secured Credit Cards

A Secured Credit Card is issued to a client who deposits cash security with the issuer. It’s particularly applicable for consumers with a bad credit history or lousy credit.

5.   Unsecured Credit Card

Credit card issuers typically offer unsecured credit cards to customers with an impressive credit history. The issuer will gradually increase your limit if you service your payments on time.

6.   Reward Credit Cards

Reward credit cards will offer the cardholder some reward in points whenever they purchase the card.

How To Choose The Best Card For Your Business

1.   Rewards or Cash Back Plans

Many cards have a reward program depending on the terms of the issuer. For instance, Sam’s Club business credit card has a cashback plan for cardholders.

Cashback programs can help you save on your business expenses in the long run. Check out if your spending pattern is in line with the reward categories for the credit card.

2.   The APRs

Check out the introductory APRs on the card. Some offer 0% introductory APRs if you operate within the credit limits and make your timely payments.

Also, verify the actual APR and the applicable interest rate on your credit card.

3.   Annual Fee

Evaluate the annual fee against the other benefits of the card. There are plenty of business credit cards that charge a yearly fee but have other attractive benefits for your business. It’s even better to go for an excellent card, like Sam’s Club Business Card, with no annual fee.

4.   Integration With Accounting Tools

A credit card needs to seamlessly o link with your bookkeeping tool to transfer information from your card to your accounting software. This makes it easy to prepare for tax time. 

5.   Credit Reporting

Find out if the credit card issuer reports to a credit bureau if you aim at improving your business credit history.

6.   Is It Friendly For Travel?

If you’re a business owner who often goes abroad, you’ll want a widely acceptable card across many merchants with reasonable charges.

Benefits Of Using A Credit Card For Business Expenses

1.   Helps Separate Personal And Business Finances

A separate business credit card helps separate personal from business expenses. Moreover, it’s easier to prepare for tax time when your records are clear.

2.   A Great Tool To Build Your Business Credit

You can build your credit history when you pay for your credit card in time and keep it within the stipulated limits. A good credit history opens the way for your business to participate in other financing options to grow your business.

3.   Participate In Cash Back Programs

Make savings on business expenses by participating in rewards and cashback programs.

4.   An Effective Tool To Manage Business Expenses

You can set spending limits on your cards for various business expenses.

Most cards allow for employee credit cards under the main card at no extra cost. You can limit and track the spending of your employees.

5.   Simplifies Bookkeeping

Business credit cards with your accounting software make it easy to track spending, monitor budgetary compliance, and prepare for the tax season.

How To Manage Your Credit Card Payments And Budget Wisely

  1. Keep tabs on your spending
  2. Pay off credit card balances regularly
  3. Have limits for various expenses
  4. Aim to work with a lower credit limit
  5. Work with a single credit card for all your business purchases

Risks Associated With Using Credit Cards That You Should Know

  • Falling into the credit card debt cycle
  • Late payments
  • Using a lot of your credit limit which incurs colossal interest charges
  • Making applications for numerous credit cards in one go

Conclusion

Understanding the available credit cards and how they can prove invaluable in raising the cash to meet your working capital expenses. Apply for a business credit card and enjoy the benefits of separating personal and business funds, simplifying bookkeeping, and also managing costs.

Author

Shashank Jain, founder of good-name, a young and energetic entrepreneur has always been fond of technology. His liking for technology made him go for engineering in computers. During his studies, he learned & worked on different computer languages & OS including HBCD, Linux, etc. He also has a keen interest in ethical hacking.

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