How to Get Business Credit Cards

When you are running a business, it is always important to have a backup payment system that could help you make payments, even when you do not have the required funds.

Business credit cards are the best option for those businesses, which cannot afford any kind of operational interruptions due to shortage of funds at any given point of time.

Business credit cards are not easy to get, unless you have decent credit history to support your request application. People with good credit score can get business credit cards easily, and their applications get quicker approvals.

The process of application for business credit cards is quite similar to the personal credit cards. However, only one credit report will be checked for approving personal credit card, but for business credit, several reports will be verified.

Credit Scores:

The credit score around 600 to 649 for any small business is known to be a poor credit score, and below 599 is considered as a bad score. In both those cases, the application for business credit card is more likely to be denied. Most of the banks might even insist on a settlement with a personal guarantor, who can be responsible for the debts that you owe.

After the year 2008, credit card companies have made the standards for issuing credit cards even more stringent for both personal and business credit cards. It was due to the occurrence of credit crunch, where many people starting defaulting on the payments. It is important for business owners to maintain their personal and business accounts separately. This will help them in managing their audits and taxes better.

Business credit cards come with higher credit limits:

Businesspeople can apply business credit cards online. However, you will need to research well before finalizing which one to go for. It can be quite confusing with so many attractive offers that are being advertised by credit card companies. Those offers are nothing but the results of high competition among them.

The advantage of business credit cards is they come with higher credit limits, and it helps businesses in ensuring that they never run dry of funds, whenever they have to make important payments. The interest rates charged on your card will be higher compared to personal cards, but it does facilitate you with a higher spending capacity, which is quite essential for running businesses.

How to set things straight for procuring business credit cards:

It is important for business to acquire credit cards, as they will have to handle a lot of expenses. It could be anything from paying rents, processing payrolls, marketing their products or services, hiring new people, product launch, for buying new equipments or machinery, and lots more. Therefore, it is always wise to have an addition payment source as a backup.

Big businesses can qualify easily for the credit cards, and the providers will not even bother to verify the personal credit history of individuals involved. Even the employees of such companies can get personal credit cards without much delay. On the other hand, small business owners will have to ensure that their credit scores are always in par with the standard requirements.

Secure business credit cards:

Companies can also go for secure business credit cards by depositing money in their accounts. The credit limit given give to them will depend upon the amounts they deposit. This is beneficial for companies whose credit scores have taken a beating due to some reason or the other. They can then rebuild on their scores by making the credit card payments on time.

Proper company registration:

Make sure you follow all the legal processes according to your state laws while setting up your business entity, because it helps in quicker business credit card approvals. While registering your firm, you will need to apply for tax identification number or the EIN. It is required by law for starting a new business and for opening a business account in a bank. Not only does it help in creating your business profile, it is also useful while applying for a business credit card.

Maintain good business transactions:

A business Bank account should be at least couple of years old to become eligible for applying a loan or a credit card. Credit card companies will study your bank transactions and then decide on approving your application or not. They will even consider the type of business you run.

Get your business listed with credit ranking companies, also called as credit bureaus. For example, Dun & Bradstreet is one of the reputed credit ranking reporting agencies, and their rankings are trusted my most of the leading banks and lenders. You could apply for the DUNS number after establishing your business. It will help you in getting through the credit verification process a lot quicker.

Make sure you go for the credit card companies that frequently update your payments to the reporting agencies on a timely basis. Some of the reputed agencies are D&B, Equifax, and Experian. The timely reporting of your credit card transactions will help you in building up a good credit rating for your business.

Get a professional website designed for your business, as this helps in getting more exposure for your business online. It acts like a tool for providing important information about your business. The website should look simple and professional. The credit card companies can read through your business information or details on your website. You will also need to conduct SEO and other online marketing methods to get better search engine rankings for your websites.

Also maintain a good personal credit rating, as the credit cards companies will always look examine the business owner’s personal credit scores as well. The banks and even the private lenders will look into your personal standings before approving any kind of loans. It will help you handle financial issues better. You can have good credit scores by paying all your invoices on time, or before the due dates.

Alternative options to credit cards:

If you are unable to procure credit card for your business, then you consider shopping or gas cards as alternatives. They are quite similar to credit cards, but the features will be limited. The approval process will be easy when compared to other cards like the Master Card or Visa cards. Pay your credits on time to maintain good credit ratings. You could also use debit cards for maintaining good credit rating, as debit card limits to the amount available in the bank account.


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