Using a credit card for your business needs can help you keep up with your expenses, avoid overdraft fees, and with many cards, you can access your account anytime, anywhere for added convenience. With a business credit card, you can easily track and categorize your spending, helping you to budget more efficiently.
Credit cards tend to also come with many added benefits. Not only can you potentially take advantage of cash back rewards and sign-up bonuses, but many credit cards also come with additional features such as travel benefits, free rental car insurance, and exclusive discounts on specific services. By choosing your card carefully, you can maximize the potential benefits for your small business.
Another benefit of using a credit card for your business needs is that as long as you are responsible and pay off your balance in full every month, you can actually build business credit. This can then be used as a reference when applying for larger loans or leases down the road.
It is important to remember; however, to use your business credit card responsibly. Late payments and high balances can quickly rack up interest and get you into financial trouble. Credit card payments can absorb your cash flow and hurt your business. Before using credit cards in your business, make sure you have incoming revenue to pay the bill.
Finally, business credit cards can only be used to make business purchases. Just because you get more points with your business credit card does not mean that you should be using it for personal purchases as well. Never commingle business and personal spending.