Business Credit Cards

What is the best business credit card?

Business credit cards can help you establish a good credit rating for your commercial venture. Because credit reporting works differently in the business sector than it does in the consumer sector, you've got to be a little more proactive about establishing and maintaining good credit. A small business credit card is an excellent tool at your disposal.

Advantages of a Business Credit Card

Having a small business credit card helps you finance the equipment and materials you need for day-to-day operation of your company. What's more is that having a new business credit card gives you legitimacy in the eyes of lenders. If you can demonstrate the creditworthiness of your company, you'll have a much easier time getting small business loans from banks if you need to access a larger amount of capital.

If you have a business credit card through a bank rather than a private credit company, you'll also have an easier time getting approved for a business line of credit. You're also more likely to get better terms on your borrowing if you open multiple credit accounts with the same financial institution, which can save your company a lot of money.

Applying for Business Credit Cards

It's important that you closely evaluate every business credit card offer you receive by comparing the terms and conditions associated with each. Look closely not only at credit limits and interest rates, but also at annual fees and activity that's subject to further charges or penalties.

The best business credit card is one that rewards you for continued responsible use. Many business credit cards allow you to collect points or other rewards that can be redeemed for business-related items and expenses once you reach a certain threshold. If you can find an offer that combines rewards with an acceptable credit limit and a low annual percentage rate (APR), then you're ahead of the game.

To apply for business credit cards, make sure your business name and federal tax identification number (FIN) are registered with all four of the major business credit monitoring agencies. Your application is unlikely to be approved if you haven't done this, which may force you to get a consumer credit card for business use, thus exposing your personal credit to risk. These four agencies are Dun & Bradstreet, Business Credit USA, Equifax Business and Experian Business.

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