Is A Business Credit Card Useful?
‘Yes,’ is the almost immediate response. That is true for the majority of firms (particularly small enterprises). Before we get into how business credit cards can help you, let’s first define what a business credit card is.
Simply said, a corporate credit card is a credit card that is owned by a company rather than a person. TConsider the business credit cards and company bank accounts, both of which are in the name of the business.
Aside from that, business credit cards operate in much the same way as personal credit cards, with a few exceptions. These exceptions include credit limit flexibility, low APRs, and other unique benefits accessible only to corporate credit cards.
Even so, corporate credit cards appear to be a viable option. However, company credit cards are appealing even without such features because the major value is elsewhere. The major advantage of a company credit card is seen in terms of business spending accounting.
Business expense accounting is a significant overhead for the majority of small enterprises. This is relatively easy to handle with business credit cards; simply ensure that all business expenses are made on the business credit card and personal expenses are made on the personal credit card, i.e. segregation of business and personal expenses is all that is required.
So the bill for your business credit card will include all of your business spending, and you won’t have to collect all of the bills or sort out the items from your personal credit card bill. The goal here is to use your business credit card for all (or as many) of your business expenses.
Furthermore, many business credit card suppliers understand this need of small firms and even organize business credit card invoices in a way that fulfills these businesses’ accounting standards. So, for the most part, they will appropriately categorize the spending on the company credit card bill in order to facilitate corporate expense accounting.
In fact, some corporate credit card providers go so far as to provide bills in a format that can be downloaded and exported to an accounting system, removing the need for you to manually enter the data in your accounting system.
If the format is not compatible for your accounting system, you can pay a software professional to develop a little quick application to convert it.
Thus, just one justification – ‘facilitation of business spending accounting’ – is sufficient to support the case for small business credit cards.