April 2,2009
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Small Business Credit Cards, Pt.1
Essential for business growth.In this tenuous times when small businesses are already liquidity-strapped and the credit card industry is retreating like Custer woulda-shoulda, the good news is that business credit card accounts are still favorable. There are many nice features to help your business thrive and grow. One built-in inherency is that they place a buffer between your personal accounting and liability and that of the business. Also, they provide much better records-keeping provision as well as categorizing where your expenses are coming from. The records are better detailed, which is nice. In other words, they are ‘bookkeeping-friendly'. One especially important feature of business credit card accounts is the ability to closely regulate their usage. This is important for any business.
Now, there are two general flavors of business credit card accounts. We have the ‘SB' type and the ‘Corp' type. Depending on your business size, this can be a very important distinction. The easiest to understand are the ‘SB' (small business) type because of its similarities to personal credit card accounts. In fact, they can show your personal name as the business name and, again, your personal name as the ‘primary agent' (i.e. – your name shows twice). Obviously, the purpose for two entities is to designate your business. Also, like personal cards, they do attach liability to the business owner. So, if your business dissolves, you're still on the hook as is your personal credit score.
Unlike your personal self, a business is an engine. You feed it fuel and it executes it's function. So, the business credit card is best applied as an emergency fuel supply. Kind of like a backup power supply. Meant for limited use and not to serve as an unending source of fuel. Again, it offers excellent records keeping and even offers bonus rewards for business-type expenses.