Small company owners may effectively manage and pay for both routine and unforeseen costs by using credit cards, which are a useful financial instrument. Business owners use these cards to pay recurring costs, including monthly electricity bills, and make regular monthly expenditures. Some companies also utilize them to purchase supplies and raw materials as needed, as well as to cover business travel costs. Naturally, it’s preferable to pay off these bills in full each month, but company owners may improve their cash flow management by charging all of the various payments and then paying the entire amount on a single monthly credit card bill.
Responsible credit card use helps company owners create and improve their commercial credit profiles, which improves their capacity to find funding for their companies when they need it. Additionally, a lot of small business credit cards provide travel rewards and/or cash back, which the company may use for future costs. Using the cards to pay for as many costs as possible may become even more beneficial if the benefits are near the top of the range.
Getting Started with Small Business Benefits
To be eligible for a corporate credit card with a large spending limit and the most generous rewards, your company will often need to have great credit status. You must submit your company’s employee identification number (EIN), any required business incorporation or partnership paperwork, and financial statements in order to apply for these cards without utilizing your personal credit history. It will usually come down to the credit histories of the company’s founders or principals if your company does not yet have a credit history of its own.
The advantages begin to mount when the approval procedure is finished. Balance transfer incentives, larger percentages of cash back on purchases, additional cash back at certain times or in particular categories, and more alluring travel rewards are some of the card possibilities available to businesses or owners with strong credit histories.
2020 Spending by Small Businesses
Many small companies’ typical spending habits have changed as a result of the 2020 COVID-19 coronavirus pandemic, and this includes how they must utilize company credit cards. To retain employees and keep their companies solvent, many company owners use the reserve cash access that credit cards offer.
One strategy for a small business trying to survive the pandemic is to use a business card with rewards for everyday, less expensive purchases, and then switch to a consumer card with a low or zero annual percentage rate (APR) for larger, essential purchases. This could be accomplished with a promotion on a new card. This allows you to make payments at little or no cost for a considerably longer grace period or low-interest term. Examine some of the top corporate credit cards for small businesses in 2020 to begin planning your strategy.
The Greatest Card for Cash Back
Small companies hoping to expand are the target market for the Capital One Spark Cash for Business card. Capital One will provide you a one-time $500 cash bonus if your company uses the card for $4,500 during the first three months of starting the account. A 2% cash back return that may be redeemed whenever you want is another allure. The annual charge of $95 for the card isn’t too high for a business card, and as part of an introductory deal, it’s waived for the first year.
Top Card for Bonuses on Travel
The Chase Ink Business Preferred credit card, a more recent addition to the market, has several significant benefits for small businesses. Within the first three months of creating the account, the firm can spend $15,000 on the card and get 100,000 bonus points. Since those extra points can be applied to any kind of travel, the owner may benefit if staff members often take trips. This card likewise has an annual charge of $95.
The Greatest Card for Long-Term Loans
Credit limits on the American Express Blue Business Cash card can be changed over time since it provides business owners more purchasing power. The card pays 2% cash back on purchases up to $50,000 annually and then continues to pay 1% beyond that. It also has no annual fee. Earned money is immediately credited to business owners’ statements. Additionally, American Express is extending its welcome bonus for new members through August 31, 2020, in light of the coronavirus epidemic.
The Greatest Card for Costco Purchases
If your company purchases a lot of items from Costco, applying for the Costco Anywhere Visa Business Card might improve your bottom line. With benefits like 4% cash back on petrol expenditures for the first $7,000 in fuel purchases annually (1% after that), 3% cash back on dining and travel expenses, 2% cash back on all Costco purchases, and 1% cash back on everything else, this card provides companies with fantastic bargains. The annual percentage rate (APR) is a fair 15% from the standpoint of a credit card, and there is no annual fee associated with the card.
