Whether you are starting out in business or are in an established business you could consider obtaining a separate business credit card. This will assist in separating your business expenses rather than merging both your personal and business expenses on the same credit card.
The benefits of having a business credit card solely for business expenses are:
- You can see all your business expenditure at a glance thereby gaining financial control.
- Finance your business purchase of goods and services, be it in the UK or abroad, either in person, by telephone or over the internet
- Certain issuers offer protection against theft, accidental damage or loss on your purchases
- Issuers often provide credit for up to 60 days which will help you with your cash flow
- Detailed monthly statements help to simply your accounting as only the business expenses will be itemised
- Travel abroad without having to purchase large amounts of foreign currency and/or order traveller’s cheques
- Some issuers can even make your travel arrangements for you whether in the UK or abroad
- Some issuers will also provide you with free worldwide medical and travel insurance
- Protection is afforded against fraudulent use of your credit card whether in the UK or abroad as long as you report it within the specified time
How do you decide which business credit card is most suitable for you? Well, it is much like choosing a personal credit card. If you think you are unlikely to carry a balance each month then perhaps you might decide to opt for a business credit card with a higher APR (Annual Percentage Rate) but which provides benefits such as rewards. However, should you decide to opt for a business credit card with a lower APR look out for things such as an annual membership fee, an application fee, introductory rates (such as a 0% APR) and what it will revert to.
Also remember that as with obtaining personal credit cards in the UK, the issuer will need to carry out a credit check against your business. In order to further assess your application for a business credit card, the issuer will need to analyse your accounts for at least two years of business trading. So have these to hand together with your cash flow forecasts.
Return to our credit card information section, or return to the homepage.