How to Choose the Right Business Credit Card

A business credit card can make things a lot easier for you especially when it comes to keeping personal expenses and business expenses separate. This is particularly important for small business owners because you need to keep a tight leash on your cash flow. 

Business credit cards offer many benefits, including rewards, free employee cards, special financing, cashback opportunities, and more. However, there are many options to choose from, so the process can be a bit overwhelming. To help you out, here’s what you need to know so you can choose the right business credit card for your needs!

1. Determine Business Expenses

Choosing the right business credit card for you requires you to understand the spending habits of your business. Do this by reviewing your books and identifies the expenses categories where you spend the most. It could be advertising, traveling, etc., but once you’ve identified them, you can search for a business credit card that will offer benefits for the specific kind of purchases you make more often. 

2. Choose the Right Rewards

Once you determine what you spend the most on, you’ll be able to find a business credit card that will reward you for those expenses. For example, if your business requires you to travel quite a bit, you’ll need to choose a card that will provide travel rewards and that doesn’t charge fees for foreign transactions. If you must entertain clients at restaurants often, choose a card that rewards dining purchases. If you do a lot of driving, go for a business credit card that will reward gas purchases. In other words, choose the rewards that will benefit you the most. 

3. Evaluate Fees and Perks

When you’re looking at options for your business credit card, you’ll need to pay close attention to the fees and perks they offer. Pay special attention to fees, because you want your business credit card to put as little strain on your budget as possible. It’s also important to know what the fee schedule looks like before you apply for the card. It’s important to note that some fees will be unavoidable, such as annual fees. In that case, make sure your business credit card’s annual fees will be made up for by perks and rewards. In fact, evaluate perks carefully because they can really make a difference between credit card options. 

4. Consider their Sign-Up Bonus

Rewards credit cards tend to offer a sign-up bonus that will give you a nice benefit right off the bat. Usually, the sign-up bonus is earned by spending the minimum during the first few months of using the business credit card. However, different banks offer different sign-up bonuses, so make sure you’re aware of what it looks like for the options you’re considering. 

5. Consider Adding Employee Cards

Employee cards will allow your employees to have purchasing power as well, which will extend the amount of rewards you get for your business. This is a great thing to consider if the bank of your choice offers reward bonuses for meeting a determined spending threshold per year. However, it’s important that you determine whether the additional fee for adding employee cards will cover enough value to justify the additional expense you’ll have to make. Additionally, you must pay attention to the account management tools and spending tools your business credit card provides, because it will make your accounting efforts easier. 

All in all, choosing the right business credit card is not as challenging as it may seem. What you need to do is understand the needs of your business, and find a credit card that will suit them best, with the most rewards and perks.

Adam Hansen

Adam is a part time journalist, entrepreneur, investor and father.