Starting a business and maintaining it, you will need to manage its finances, from the capital to the expenses and profit. However, profit is the final destination that relies on capital management and expenses. A business may need constant cash flow and regular expenses to make it through. The inevitable need for a small business credit card comes in.
Credit card services have been quite popular with businesses, especially start-ups and small farms, with little to no financial backing. Small business credit cards are specifically designed to provide immense support to these businesses. In addition, some beneficial features are added to such credit cards, including bonus rewards on purchases, reward points, and, most importantly, tracking business expenses.
Types Of Small Business Cards & Why They Are Important?
People have heard about the two most popular types of credit card commerce include business cards and corporate cards. These two entities are completely different in their purpose and functions. Business cards are issued to the business owner with guaranteed proof to pay back the sum.
On the other hand, corporate cards are issued to big corporate organizations. These corporate cards are not merely given away to individuals for fear of not getting back the payment. However, there is no reason to be disappointed, as two more card types are specifically designed for small business owners. These are; credit cards and charge cards.
Credit Card: Credit cards come with a spending limit. The user will not be allowed to breach the limit. If they happen to do so, they will be charged an extra fee, or the card gets declined. When the user saves up a balance from their spending limit, the amount gets carried forward to the next month when a minimum monthly amount is paid. This can also impact the credit score of the user. Above all, credit cards are easy to acquire.
Charge Card: Charge cards may be difficult to acquire, but they have no pre-set limit for spending. This allows the business to lend large amounts without applying for increased credit. However, the user must pay the full amount every month without fail. On failing, the card may get suspended, and the user will have a steep penalty fee.
6 Small Business Cards For 2022
So, it is understandable why businesses may incline business cards, credit cards, or other such matters. Small business credit cards have been tremendously popular in the past few years. So much so, there is such a variety that it can get downright confusing for a newcomer. Different small business cards are available for different business-related operations such as travel, hotel stay, balance transfer, airlines, etc. Let us have a brief look at some of the most recognizable ones.
- Two specific small business cards have been quintessential in acquiring cash back on business purchases: Chase Ink Business Cash Credit Card and Capital One Cash Spark Card. The first card trumps with its sign-up bonus cashback; the second has a strict 2% cashback policy on all business purchases.
- For balance transfer, Chase Slate and US Bank Business Cash Rewards World Elite Mastercard are two optimal choices. Chase Slate comes with no introductory offer but allows new cardholders a statement credit for spending a certain amount within the first month. The Mastercard, on the other hand, has an introductory fee but requires a good credit score to acquire the card in the first place.
- Similarly, small business cards for travel include Chase Ink Business Preferred Credit Card and The Business Platinum Card From American Express Open. For instance, Chase has a lower annual fee and supports employee cards without costing anything extra. Though the American Express Open charges heavily on the annual fee, it has a high sign-up bonus, high point earning opportunity, and cashback bonuses from big corporate hubs such as Adobe, Dell, and Indeed.
Credit may have a negative undertone, but for many, it has been a great source to branch out ideas. Credit implies borrowing financial support from an organization to pay upfront for individual purchases. Then, the paid amount and a certain commission amount have to pay back to the organization at a later date agreed by both parties.