What are Business Credit Cards? What are Their Advantages?

Credit cards are one of the most popular banking products used by individuals and businesses alike. However, it’s not a good practice for business owners to use the same card for personal expenses and business expenses. This is where a business credit card comes in.

What is a business credit card?

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A business credit card is a special type of credit card designed for business owners as well as employees of a company. For the former, it’s linked to the credit rating of the company for related services, and for the latter, it offers easy processing and monitoring of company expenses.

The following are some of the salient features of the business cards:

• Credit Rating Boost: Building a high credit rating for a business can be challenging. However, by getting a business credit card, and using it responsibly through timely payments and controlled utilization, an entrepreneur can achieve a good score over a short period.
• High Credit Limit: Compared to personal credit cards, business credit cards have a high credit limit which helps a business owner in managing their cash flow with ease.
• Better Management: By keeping the personal expenses separated, a business owner can calculate their taxes without the hassle, and also manage their personal credit rating and the business credit rating individually.
• In-House Frauds Detection: A large number of frauds in every business are committed by their own employees. This can be kept in check with a business credit card. This is because when an employee puts a charge against the company account, it’s recorded in the database. In addition to that, fudging the expenses is difficult in this system.
• Special Perks: Since the business credit cards are designed for the companies, they often come with some perks that are beneficial for the business owners. These include reward points for travels, shopping for office supplies and other business-related goods, etc.

It’s usually a smart move for a businessperson to get a business card. That said, proper utilization of the same is still necessary.