Running a business comes with many expenses, and you may be wondering when the right time to get a business credit card is. Business credit cards can provide important benefits to your company, such as expense management, credit to grow your business, and rewards or perks!
Rewards credit cards can be a great way for businesses to earn extra cash while spending on business essentials. You can use the rewards for many things, including incentives for your employees, saving on expenses, growing your business, or perhaps even a company retreat paid for with rewards. Choosing the right card for your business can seem daunting. There are so many credit card offers out there for you to take advantage of, and they can seem attractive at first glance. It’s hard to compare them, so here are three of the most important criteria to consider when deciding which card will be best for your business:
How much are you spending?
Knowing how much your business spends is the first step to knowing which card is right for you. You might have a high-spending business; or you might have a very focused-spending business, where you only spend on specific items. Whether you are one or the other, or both at times, knowing your spending can help you estimate what you would be spending on the card each month. Once you have an estimate of what you spend each month, you can then compare card offers by looking at the point accumulation and seeing which offer gives you the best rewards for the amount you’re already spending.
Where are you spending?
Do you spend mostly on office supplies? Do you have a lot of materials needed each month? Are you spending more on gas and travel expenses each month?
Many business rewards credit cards offer travel insurance on their cards, as well as more points earned on travel. If you travel often with your business, a travel-focused business rewards credit card might be right for you. Or, do you spend most on online ads? If so, a straight-forward point system for a fixed amount of points for each dollar spent would be best. Some business rewards cards also offer specific categories with more points, and anything other than those categories earns less points. For example, a reward card that offers 3% cash back on gas might only offer 1% on everything else, so if your business doesn’t have many travel or gas expenses, it’s better to go with the card that offers 2% cash back on everything.
What is the card’s maximum limit?
It’s important to check for maximum limits. Some credit cards offer a great point system for specific categorical spending. However, they can also have a maximum limit on each specific category. For example, if a business credit card lets you earn 3 points for each dollar spent on travel, but has a limit of $10,000 maximum, anything after the $10,000 will earn you only 1 point per dollar spent. And if you spend about $100,000 a year on travel, even this travel business credit card might not be a good fit for you. You might be better off with a straight forward 2 points for each dollar spent on everything with no maximum.
In many cases, having a fixed point system business credit card could get you even more actual cash back. ICCU’s Business Visa Rewards Credit Cards offers fixed points for every dollar you spend, and there’s no limit on any category. This means you can earn the same great cash back for every dollar you spend. If you are still not sure which card would work best for you and your business, ICCU’s Business Relationship Officers would be available to walk through the process and benefits with you. Contact one of our Business Relationship Officer and apply for a business visa rewards card today!
