Business credit cards or corporate credit cards are designed for business owners. They are used for business expenses such as purchasing supplies, office furniture, client entertainment, making impromptu purchases, travelling, etc. Many business credit cards have a clause in the terms and conditions prohibiting cardholders from using them for personal expenses.
Moreover, a business credit card helps you build business credit, which lenders and other banks will look at if you apply for a business loan. Some credit cards provide short-term financing, which is helpful for large purchases in the short term.
Business credit cards function similarly to personal credit cards. You charge purchases to your card and receive a statement with your total balance owed and the minimum amount due at the end of each billing cycle.
Business credit cards, like personal credit cards, have different interest rates: the more creditworthy your company, the more likely you are to get a favourable one. A business credit card is only for purchases related to the organisation; it is not for personal use.
Also Read: 10 Best Credit Cards For Online Shopping
A business credit card allows business owners to track expenses and manage their day-to-day operations. It aids in keeping business expenses separate from personal spending. It also provides easy access to a line of credit, which is especially beneficial to small-business owners who may lack the capital to get a business idea off the ground. Increased cash flow can also be used to cover changing inventory and seasonal or unexpected costs. There are many other numerous features available on business credit cards that can make owning and operating a business a lot easier.
The parameters of each bank or credit card may differ regarding the eligibility criteria to apply for a business credit card. Your application may be rejected if you do not meet the bank’s requirements. But there are a few basic criteria you must meet to ensure that your credit card application is approved. These are:
Documents required to qualify for a business credit card are :
Income proof required to qualify for a business credit card:
Here’s how to apply for a business credit card online:
Following the basic procedure, the bank will review the documents, and your card will be issued.
Business credit cards have some distinct advantages compared to consumer credit cards. Some are listed below:
With so many business credit cards on the market today, it can be difficult to choose the best one. Here are some suggestions to help you choose the best business credit card online.
The nature of the expense is the first thing you should consider when selecting a business credit card. Business owners or those seeking a business credit card should understand why they need it.
Business credit cards often come with bundled offers to entice users to use them frequently. It’s critical to consider which cards provide incentives and benefits that your company can use.
Before choosing a business credit card, it is critical to consider the interest rates. Banks and credit card companies sometimes quote monthly interest rates. This can be useful when conducting day-to-day transactions.
Before applying for a business credit card online, applicants must ask card issuers to reveal the credit limit.
For all the benefits of a small business credit card, there are a few drawbacks. Here are some of the most common business credit card mistakes to avoid:
Business credit cards are similar to personal credit cards but designed for business expenses. Business credit cards can help you build credit, earn rewards, and keep operating costs low by allowing you to make purchases with special financing.
Choose the best business cards that will provide you with a variety of rewards and perks that will benefit your business. And, as with any personal card, do not overspend on a business card because you could be held personally liable for any debts.
Ans: You do not need to be the owner of a corporation, but you must be able to list some type of business, even if it only involves one person.
Ans: When you apply for a business credit card, the card issuer may look at your company’s track record as well as your personal credit.
Ans: Most business credit cards require good to excellent credit to be approved. A score of 700 or higher is considered good.
Ans: Identify the parameters you are not meeting to be eligible for a credit card. For example, check your credit score. Usually, a credit score over 750 is preferred by credit card companies. You must also take your employment type and age into consideration. Finally, check with the credit card company if they need any additional documents.
Ans. A business credit card is available to self-employed professionals, proprietors, or partners between the age of 21 and 70 who are Indian residents and has a good credit history.
This article is solely for educational purposes. Navi doesn't take any responsibility for the information or claims made in the blog.
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