How To Apply For The Best Business Credit Card For Your Small Business

How To Apply For The Best Business Credit Card For Your Small Business

March 10th, 2008

Updated List Of the Best Business Credit Card Offers Below!

Like most small business owners, I have my eyes on the prize with expectations based on the potential of future expansion. While my current small home business is still in the early growth stages and has not developed to the size where I needed to incorporate, I decided early on that now was a good time as any to start keeping my personal and business expenses separate by taking advantage of the expense tracking and management benefits afforded by business credit cards.

Whether you are a small business owner who works from your own home, or have your own dedicated virtual office setup, there may eventually come a time when you will need additional cash and credit infusion to pay for business expenses such as inventory, office supplies, or utility fees including wireless services. More than half of all small businesses currently use credit cards to pay for expenses, but less than half of the users utilize business credit cards. While most seem content on relying on their existing consumer cards, there are a number of key reasons why it’s better to use business credit cards under your company’s banner.

For those running a business as a sole proprietorship like myself, you may have already applied for an Employer Identification Number (EIN), sometimes referred to the Federal Tax ID. If so, you will need to enter it when applying for a business credit card. If you are a regular non-business consumer who wants to take advantage of the rewards and benefits that business cards have to offer, you can still apply by entering your personal name as the name of the business, thereby leaving the Federal Tax ID part on the card application blank. That’s generally permissible because individuals can always declare themselves to be a sole proprietorship business unto themselves.

Benefits And Advantages Of Using A Business Credit Card

Business credit cards provide a focused selection of business oriented tools to help business cardholders better manage their expense transactions and day to day employee operations. Many of their advantages are not available in ordinary consumer credit cards. Here are some of the important small business benefits that they offer:

1. Special Business Rewards - Business credit cards offer unique discounts and rewards for an array of business expenditures that range from office furniture and equipment, to airline travel, gas fill-ups, car rentals, and utilities such as wireless services. Many businesses also choose to carry multiple business cards - using low to 0 interest APR offers to carry 0 interest balances, while using reward oriented cards to earn airline miles or cash back of up to 5% on business related purchases.
2. High Credit Limit - Compared to their consumer card counterparts, most business credit cards tend to offer higher initial credit lines, an attractive benefit for growing businesses in need of access to lots of credit. The higher business credit limit is particularly attractive when coupled with 0% introductory offers for purchases and balance transfers. High credit limits and 0 APR offers help businesses build start up venture capital to better grow and expand their enterprises.
3. Avoidance Of Asset and Expense Commingling - For solo proprietorships, commingling your personal and business expenses is not as big of an issue. But as your business expands, due to liability and taxation concerns, you may ultimately want to convert your business into a limited liability company (LLC) or corporation - operations that mandate the separation of your personal expenses from your business transactions. By using dedicated small business credit cards now sooner than later, you make it easier to complete the transition in the future.
4. Multiple Cards For Employees - One useful benefit of business credit cards is the ability to request multiple linked credit cards for your business employees. By adding employees as cardholders to your account, you enable the consolidation and tracking of your business transactions from one location. Most business credit cards also offer free expense accounting, with transactions broken down by each authorized employee’s card access account.
5. Itemization and Expense Tracking - The usage of business credit cards also offers the flexible and scalable ability to fix preset credit limits for each employee. Not only can you place credit usage limits for each employee cardholder working off your account, many card programs allow you to set limits on how much particular employees can spend in specific purchase categories. Business credit cards make it easier for small business owners by providing monthly and year end credit card statement summaries, with all transactions conveniently itemized and categorized. Rather than having to fumble around with a bulky envelope full of receipts, business credit cards make it easier for you to manage your cash flow and daily business transactions.
6. Opportunity To Build Business Credit - A small business credit card also offers your new business the opportunity to link your business tax ID to the account, enabling your business to build its own credit history. Maybe not now, but having a developed credit report and ready access to credit are key ingredients to growing your future business. One day, your business may very well require a capital infusion through credit loans to take it to the next level.

List Of The Best Business Credit Card Offers:

1) Discover Business Card - With this card, businesses can earn 5% cash back reward bonuses on office supplies, 2% on gas, and up to 1% on everything else. The card also offers a 12 month 0 APR balance transfer deal with a 3% balance transfer fee, capped at $75. There is no annual fee. Perks for small business owners include free employee cards with customizable spending limits and monthly reports, categorized online quarterly and annual statements, and free travel benefits.

2) American Express Starwood Preferred Guest Business Card - This card is the best hotel and airline miles credit card for businesses looking to earn travel rewards. Often touted as the swiss army knife of travel credit cards, the Starwood Preferred offers the ability to earn airline miles that can be redeemed for free airline tickets towards virtually all major airline carriers and good for most existing frequent flyer plans. With the card you earn rewards by accumulating Starpoints, with 1 Starpoint for each $1 spent. Your earned Starwood points can also be redeemed for free nights at participating luxury hotels that include the Sheraton, W Hotels, and the Westin. The best payoff deal is reserved for businesses that are particularly big spenders - once you spend $30,000 in one year, your status gets upgraded to Starwood Gold Preferred Guest, allowing you to earn 3 Starpoints for every dollar spent. Not a bad deal at all - especially for businesses that require employees to travel frequently.

3) American Express Simply Cash Business Card - Earn 5% cash back on gas, office supplies, and wireless services, and 1% cash back on virtually all other purchases. This business card provides a 0% introductory APR on purchases for the first 12 months and a competitive APR thereafter. Cash back rebates are automatically credited to the statement each month. As part of Open Savings, business owners get to save more on hotels, airlines, and car rentals. There is also no annual fee.

4) Chase Business Rebate Card - This Chase business credit card offers 3% cash back on a wide array of eligible purchases at restaurants, office supply stores, gas stations, building supply stores, and home improvement stores. Cardholders earn 1% cash back everywhere else. There is also a 12 month 0% interest APR offer for purchases and balance transfers with a balance transfer fee percentage of 3%, capped at $99. There is also no annual fee.

5) Citi Professional Cash Card - Earn 3% cash back on purchases made at restaurants, certain office supply merchants, gas stations, and auto rentals. Plus, you can earn 1% cash back on all other purchases. Citi business customers also have free access to an online expense organizer that can create customized quarterly and annual account summaries, and categorized reports for client billing, tax purposes, or reimbursement. There is also no annual fee.

original post:money blue book