Can my Business Benefit from a Corporate Credit Card?

If you have a small business, you may wonder if it's worth it to have a corporate credit card. The truth is a corporate credit card may be of more benefit to a small business than to a larger one. If you're just starting out, you probably don't have an accounting department. You may not even have a bookkeeper. If this is the case, then a corporate card could be a great timesaver. With all business spending in one account, it is easy to keep track of expenses up to the minute online.

Some small business owners have fears that they will overspend if they have a corporate credit card. If this is something you worry about, you can get a card with a low spending limit, or a secured card, where your credit is secured by money kept on deposit. You can even get prepaid corporate credit cards.

Another worry is that if you obtain cards for specific employees ' the office manager, for example ' that person may take advantage and spend too much. With corporate cards, you can order cards for employees, and put strict spending limits on them. For example, you can allow a set number of transactions over a give time period, or you can allow a fixed dollar amount over which they cannot go. Plus, you can instantly track spending online, so you'll be able to tell right away if an employee is using a card improperly.

Here are some of the other benefits of having a corporate card for your small business.

By putting all business purchases on a single credit card, bookkeeping is vastly simplified. You can easily look at your spending history online any time, and at the end of the month, rather than cutting 20 checks to 20 businesses, those businesses are already paid, and you simply cut a single check to pay the credit card bill. You can also access your spending records monthly, quarterly, or yearly to recognize trends in spending and better prepare for the following year.

If you choose a business credit card with a rewards program, you will reap extra benefits like cash back, retail points under 'points' programs, or even frequent flier miles, which will help if your business involves travel. Like with personal credit cards, however, those rewards can easily be offset by large interest payments, so it is best to pay off the entire bill each month to maximize the value of the rewards.

The bottom line is that small businesses can benefit greatly from having a corporate credit card.

About the Author:

Peter Carville is a freelance article writer who writes for Financial Facts about the current financial news and the credit crunch.