5 Things You Should Know Before Requesting a Business Credit Card

Any business owner who is yet to tap into the exploration of business credit cards might be missing innumerable tremendous rewards and financial opportunities. Well, why not try not to miss them? 

Business credit cards are structured to offer a break from your budget. They entail nice cash-back packages, travel discounts, and easy payment plans.

If you have a pending offer and contemplating if requesting one is worth it or not — just keep in mind these 5 important things. 

Five key things you must know before applying for a business credit card

1. They are accompanied by massive credit limits

Business credit cards are designed to have high credit limits. It has the muscle to provide extra capital for businesses by adding to the company’s financial resources. 

Getting these outburst credit limits perks up your credit score since you will probably spend less than the apportioned monthly limit. You would have to be vigilant to any business credit cards with boundless spending limits as they tend to come with higher annual fees.

2. They come with versatile rewards

Compared to “traditional” credit cards, business credit cards are loaded with great rewards. These rewards sometimes give discounts when purchases of stationery items like printer, ink, and paper, internet services are made.

Those bonuses can be very valuable if your organization deals in the massive procurement of office supplies. Some business credit cards provide mouthwatering rewards to entrepreneurs who spend on business trips like upgrading hotel rooms or the right to use private airport lounges.

3. Flexible payment terms

Credit card issuers understand that income can be an unpredictable thing for their customers, especially for start-ups. This fact, luckily, gave birth to personalized payment structures for various users — and not just extra payments. 

For instance, for the periods you experience low turnout, there might be an opportunity to put off payments to a later date without being penalized.

Several business credit cards provide a plan for payment extension with special terms when big purchases are made. This could be a purchase of new office equipment or a new logistics/delivery vehicle.

4. The process of application is more than what you see on the surface

Once the business credit card issuer receives a card application request, they proceed by checking both the applicant’s individual and business credit records.

Your credit score says more about you than you may think. So, endeavor to know the current status of your credit reports on these consumer credit score bureaus – Experian, Equifax, and TransUnion — and make sure you have a good credit score.

5. Personal credit is usually tied to the card

Nearly all business cards demand you attest to a personal guarantee during application. It means that if your company defaults in making required payments, you are not exempted from being penalized, which could affect your credit score.

On the other hand, some companies still do not report defaulters to both consumer and commercial credit bureaus. 

The Bottom Line 

So, is getting a business credit card worth it for you? With all the benefits — you get a handful of specific risks. Are you ready to just bear with them, or maybe an old-fashioned personal credit card is your way to go? 

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