Credit cards have become indispensable tools for the modern business. Not only do many online transactions require a credit card, but a business credit card also makes tracking expenses a piece of cake.
And if you have multiple employees who need the ability to efficiently make purchases, many card companies give you the option of having multiple cards with different spending limits and individual reports.
When searching for the best business credit cards, there are a few things you should look out for.
The first step is to determine what your business needs the credit card for. Here are some reasons you might be using a business credit card:
- Your business drives a lot and you’re looking for strong gas rewards
- Your business needs some extra purchasing power, but plan to pay off the balance within 12-15 months
- You make many common business purchases from companies like FedEx, Hertz and others and would like to earn rewards
- Your employees make many flights throughout the year and you want to earn airline miles
- You’re a new business looking to establish a good line of credit
Whether you are looking for a business credit card for one of these reasons or others, here are some tips to consider:
- If you are absolutely sure that you’ll be able to pay off your bill each month, then focus on maximizing rewards. Interest rate and APR only matters if you’re going to carry a balance.
- If you are already carrying a balance on another card or have a high interest loan, consider looking for a 0% balance transfer deal for 12 – 15 months (and if possible, try to find one without an upfront fee)
- If you need an influx of purchasing power for your business, look for a card with 0% interest on purchases for the first 12-15 months.
- If you plan to carry a balance for multiple years, try to find a business card with a low 2.99% – 5.99% interest rate. Often, these rates are lower than business loans.
- Keep in mind that cards that offer low introductory balance transfer or purchase rates often come with lower lines of credit. Try to maximize your line of credit if you think you’ll need it.
- Almost all cards have a minimum monthly payment, so make sure that even though you have a 0% interest rate you also have the ability to keep up with the minimum monthly payment.