Small business owners manage a lot of responsibility, and when first starting out, you're just as likely manage the trash pick up as manage the payroll. Of course, finances are a huge consideration and small business credit cards can be a major asset, when used responsibly. Opening a small business credit card is a great way to streamline day-to-day business expenses while enjoying added perks, such as rewards and purchase protection.
Small business credit cards provide a line of credit that can be used to purchase anything you may need for your business, from supplies to equipment. Without a credit card, you may not have the cash available to afford these purchases. Many business owners have to spend money to earn money, but that can be hard to do without a credit card. The line of credit can help your cash flow by giving you the ability to make purchases that can help you fulfill business orders.
Many cards also offer interest-free financing so you can pay for purchases over time without incurring interest. The Blue Business® Plus Credit Card from American Express offers 0% for the first 12 months on purchases (then 14.74% to 20.74% variable APR). (See rates and fees).
It can be a hassle to reimburse employees for business spending on personal cards, so opting for a business card is a smart way to manage the process. Employees can use the card for all business expenses, and you'll receive one bill with all your spending and any employee spending every month. Plus many card issuers provide free employee cards, such as the Capital One® Spark® Cash for Business and Ink Business Preferred℠ Credit Card.
As the business owner, these cards give you more control of how much employees spend versus if they use a personal card. You can set spending limits and freeze cards as needed.
Many business cards offer rewards programs that can earn you cash back, points or miles. All the purchases made on your business card account earn rewards — which includes any purchases employees make. Rewards can be redeemed in a variety of ways, such as statement credits, gift cards, merchandise and travel.
The Business Platinum® Card from American Express offers rewards geared toward business that spend a lot on travel: Earn 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com and 1X points on all other purchases. There are also cards with simpler rewards programs. The Capital One® Spark® Classic for Business offers 1% cash back on every purchase.
Similar to personal credit cards, business cards provide numerous travel and purchase protections. This may include no foreign transaction fees, cell phone protection, purchase and extended warranty protection, trip cancellation or interruption insurance and auto rental damage collision waivers.
All Capital One business credit cards offer no foreign transaction fees, auto rental damage collision waivers, travel and emergency assistance services, purchase security and extended warranty protection.
If you want cell phone protection, the Ink Business Preferred℠ Credit Card offers coverage up to $600 per claim against covered theft or damage for you and your employees listed on your monthly cell phone bill when you pay it with your Ink Business Preferred℠ Credit Card. (Terms apply.)
Most business cards offer quarterly and year-end summaries, plus the ability to download purchase records to accounting programs like Excel and Quickbooks. This allows you to easily track spending and simplify financials come tax season.
Amex business cards allow you to review a year-end summary and send transactions to Quickbooks on a daily basis, after enrollment. Capital One business cards provide an easy view of recurring transactions, a year-end summary and the ability to download purchase records into Quicken, QuickBooks and Excel. Chase business cards offer quarterly reports and integration with bookkeeping software to simplify accounting.
For rates and fees of the Blue Business® Plus Credit Card from American Express, click here.
Information about the Capital One® Spark® Cash for Business and Capital One® Spark® Classic for Business has been collected independently by CNBC and has not been reviewed or provided by the issuer of the cards prior to publication.