Best Credit Cards
Balance Transfer Cards
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0% Purchase Cards
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Debit Cards
Corporate Credit Cards
Small Business CardsSummary:Just like there are multiple advantages to using a personal credit card, there are also many benefits to using corporate credit cards for your business. These benefits range from better cash flow and expense management to making significant savings through tax deductions as well as being able to make purchases online, which are usually cheaper than going to a regular shop. However, to be able to take advantage properly of corporate credit cards, you need to have a good understanding of how they work and how to find the best possible deals for your business.
What Are Corporate Credit Cards?
Corporate credit cards are quite similar to personal credit cards in that they perform the same basic function, namely to allow you to make purchases in a physical location or over the Internet. You are then required to either pay off your purchases in full at the end of the month or make a minimum repayment. You will be charged interest on the outstanding balance.
CitiBusiness Gold Credit Card
Earn 1.25 reward points that never expire for every dollar you spend with the Citibusiness Gold Credit Card. Managing your business have never been so rewarding.
- 0% p.a. for 4 months (reverts to 20.74%p.a.) on purchases
- 0% p.a. for 4 months on balance transfers
- $74 (half price annual fee for the first year thereafter $149) annual fee
- 21.49% p.a. on cash advances
| Interest Rate (p.a.) | Balance Transfer Rate (p.a.) | Annual Fee | Cash Advance Rate (p.a.) | |||
|---|---|---|---|---|---|---|
 Citibank CitiBusiness Gold | Earn 1.25 reward points that never expire for every dollar you spend and enjoy complimentary international travel insurance with this card. | 0% for 4 months (reverts to 20.74%) | 0% for 4 months | $74 (half price annual fee for the first year thereafter $149) | 21.49% |   |
 American Express Platinum Business Card | What some calls the ultimate business card. The AMEX Platinum Business Card does not come with a credit limit and thus allows you to better manage your cashflow during tight times. | $1200 | | |||
 American Express Gold Business Card | Earn a whopping 2 points for every dollar you spend on selected Qantas products and services. Also comes with no credit limit. | $169 | | |||
 American Express Qantas Business Card | $0 annual fee for the first year makes this card great for start-ups that want access to reward programs and the cashflow a credit card provides. | $299 | |
However, there are quite a few differences between the two, despite the fact that the principle is the same. First and, probably most importantly, corporate credit cards are issued in the name of the company, meaning that the business is responsible for any debt and not the individual. This not only ensures the personal protection of the business owner, but also makes record keeping much easier. It is easier to identify and track business expenditure when using a separate card for it.
Corporate credit cards make record keeping simpler because at the end of every month you will receive a detailed statement with all the expenses on the card. Thus, rather than having to keep a manual record of all your transactions, as you would with a cheque or using cash, you will have a complete record issued automatically at the end of the month.
Another difference between the two is that you can have additional cards issued on the same account for different employees. This will make their life easier, as well as yours. They will be able to use their cards to make business purchases rather than using their own funds. Plus their expenses will be listed on your monthly statement, giving you an at-a-glance overview of your business expenses.
Corporate credit cards differ from personal credit cards in that they are issued with certain limitations and restrictions. Some of these credit cards have restrictions about purchases you can make on the card, meaning that you can't buy just anything that strikes your fancy using your credit card. Additionally, you might also have some limits in terms of cash advances, meaning that you might not be allowed to make ATM withdrawals at all or there is a certain ceiling regarding how much you can withdraw.
The Benefits of Corporate Credit Cards
Your first reaction might be that you don't need a corporate credit card for your business because you want to avoid incurring debt as much as you can, especially considering the recent economic upheaval. While this is a laudable sentiment, it is rather impractical, especially for a company in the B2B sector where payments can be delayed and thus cash flow seriously affected. You will find that most companies end up bankrupt due to negative cash flow than any other reason. That is why it pays to have a backup solution such as a corporate credit card.
Corporate credit cards are useful from a logistics viewpoint since you can make many purchases from the comfort of your own office via the Internet. They are also an excellent tool to guarantee the safety of your funds since you won't have to carry around cash with you all the time.
Choosing The Best Corporate Credit Cards
When analysing offers for corporate credit cards there are certain factors that need to be analysed, depending greatly on how you intend to use the card. Even if you plan on paying off your statement in full at the end of each month, you never know when an opportunity may arise for an investment to expand your business that will require a few months to pay off. Therefore, one of the first things you need to look at is the interest rate. The lower the interest rate, the more money you will save.
You should be fully aware of all the fees associated with the card, including annual fees and transaction fees. Penalties are also important, so you need to know exactly when they apply and how much you will be charged in each situation.
When it comes to corporate credit cards it is vital that you check all the terms and conditions. Not only do you need to know exactly what you are committing yourself to, but oftentimes you can negotiate some of the terms, especially if you are considered a large client. Remember, it pays to read the fine print. This ensures you don't get any nasty surprises later on, such as a low interest rate being valid for a short introductory timeframe, rather than the life of the credit card as you might have initially thought.
Proper Management of Corporate Credit Cards
Just like with any credit card, it is vital that you manage your corporate credit cards properly to avoid debt due to the accrual of immense interest costs. One way of keeping debt under control is to limit the number of corporate credit cards you issue for your employees. Also make sure that you entrust your cards only to responsible employees. This will help you reduce the likelihood of unnecessary debt while keeping interest costs at a minimum.
If possible, take advantage of the interest-free period, which can vary, but is usually approximately 45 days. If you pay off your bill in full at the end of each month, you have basically been taking advantage of a short-term interest-free loan, which can really help with your cash flow.
You should try to avoid using your corporate credit cards for cash advances as much as possible. This is because cash advances are subject to much higher interest rates and the interest starts accruing the second you make the withdrawal. Thus, it is critical that you only resort to cash advances when there is absolutely no other option available.
Corporate credit cards are extremely useful for a business, but only as long as they are used responsibly. Ensure the successful expansion of your business while keeping costs at a minimum by ensuring that you use your corporate credit cards wisely.
