Six Ways Small Business Owners Can Benefit From Using Company Credit Cards

A small business owner has many tools available to them, whatever industry their enterprise is in.

So many in fact that sifting through them all to figure out how to make your business as successful as it can be might be quite exhausting.

But, whatever the industry you're in, you'll be dealing in money, and business credit cards are a useful tool for just that.

They give you a degree of flexibility in paying and receiving payments, they simplify your bookkeeping, and more.

And since every bank in the country wants to be used by business owners, there are competitive rates and a wide range of options available for company owners whatever your sector.

Here are some of the many benefits that small business owners can enjoy from using a company credit card, which you may have never even thought about.

Whether you're selling products or providing a service, your business will be generating profit irregularly, whilst you'll have to pay your staff and bills on a monthly or fortnightly basis. One of the biggest benefits of having a business credit card is being able to plug those gaps. This means you don't need to wait until your customer's payments are processed to buy stock, and you have the cash to buy in bulk before key events or new seasons.

As you may well know, the standard grace period a credit card provides is a month, but certain business cards double this to two months. If that interests you, be sure to search it out, though you'll likely miss out on other rewards in exchange for it, so choose carefully and prioritise what's most important for your growing company.

Monitoring employee spending is difficult if your colleagues are not using company cards. How do you track if a payment was for the business or personal use if it's not overtly clear? Not having company cards also means that you can't limit employee spending, and that additional bookkeeping and reports are needed to keep everything squared away. But since most business credit cards allow multiple users and cards, you can quite easily collect and collate all these purchases to one account, and avoid awkward conversations about what does or doesn't need to be reimbursed from individual accounts.

If you're a business whose employees travel often, or you deal with many international clients, you should know that many business credit cards cater to this. You'll find options that provide various travel insurance types - luggage insurance, car rental insurance, and so on - and no foreign transaction fees when spending abroad. And as a nice little bonus, you can get flight lounge access around the world.

While commercial cards do not have 0% fraud liability, they can come with purchase security and extended warranty protection. This will be a welcome tool for businesses buying expensive equipment, staff computers, or even just business phones. If those items are lost, stolen, or damaged, your business card provider may provide insurance for them. If this interests you, just remember to search out these bonuses, as they do not come standard.

Business cards often supply quarterly summaries to give you an in-depth understanding of your card use. They're designed for you to use and profit from them, meaning you can import them into Excel or Quickbooks easily. The benefit here is not only to your accountant (or you), who now has receipts and numbers for the year's trade, but to your budgeting. Having an added understanding of where your money is going might help you cut excess costs or work out which parts of the business might require larger funds to be put aside.

When you consider the overheads, stock prices, employee wages, and unexpected repair costs, budgeting can be complex work. Having most or all of your payments organised into neat summaries gives you a quick look into what the business' current situation is, and where you need to make changes to improve. These summaries won't do your budgeting work for you, but they'll guide and categorise it.

Though the temptation of free flights, accessories, or hotel stays is one of the most appealing aspects of a personal credit card, they have very little impact on your business. That said, credit cards that are specifically for businesses provide some of the best rewards and offers to the card owner themselves. This can be enough frequent flyer points to do a round-the-world trip, or to buy a new computer for the office. Whatever you use the points for, they're a nice cherry on top for edging out the competition.

When you're just starting a business, and it's little more than a few tools and handshakes, you'll be using your personal card for everything. But once your business has been officially registered, it'll take on a life of its own. When this happens, it's important to separate your personal expenses from the business for bookkeeping, tax, and credit reasons.

This provides a level of security to your personal belongings, and has the bank rank the business's credit score separately from your own. Using a company credit card is one of the simplest ways to separate the two.

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It's important to remember that though a company card has a wide range of uses, it's a tool to be used responsibly and conscientiously. Greater freedom and flexibility with your spending does not mean more money, and before you apply for your new business card it's important to spend some time getting to know the conditions, fees, and interest rates attached to it. That way you can enjoy the benefits without falling into the pitfalls of improper use.