Loans and equity can offer your company the financing it needs to succeed in the big picture, and resources like Seek Business Capital make it easy to connect with the right financing sources. But they aren’t always going to be the best option for your day-to-day expenses. Whether you’re sending an employee across the country to close a new deal, you’re seeking out financing for your equipment, or you’re dealing with an emergency maintenance issue, credit cards can provide you with a lower pressure and more flexible way to pay.
However, there are a whole lot of business credit cards available and a broad slate of features to pay attention to. We’ll run you through the considerations you should pay attention to when shopping for a new business credit card. Ultimately, you’ll want to look at the perks a card offers and carefully evaluate which is going to have the greatest financial impact for your company.
Cashback savings are a great choice for a business that regularly finds themselves spending money on smaller expenses. Cashback savings give you a flat percentage back on every dollar your spend with your business credit card, and that’s a great choice if you’re spending on a weekly or daily basis.
Just keep in mind that you’ll carefully want to evaluate your business’ priorities before making cashback savings your main concern with shopping. If you’re making a lot of big ticket purchases and taking a while to pay them off, the advantage you get from cashback might be outstripped by your card’s interest rates.
Maximizing your cashback savings will require you to carefully examine the offers available to you. Some credit cards have limitations on what purchases will qualify for cashback, while others offer variable cashback percentage rates on the type of purchase. 2% cashback is a pretty standard rate, but even that might not be your best choice when you take into consideration the fact that many card companies also provide bonuses for first using your card and hitting certain benchmarks.
Travel rewards are a more specialized perk than cashback savings – but if you travel regularly, it could be the most sensible option for you. Travel perks can include discounts on airfare, hotels, and food, and you could hypothetically use your travel perks credit card for all of the expenses far afield and then square it away later. Pay special attention to the feature edge cases. Bonuses like expedited TSA check-in, annual flight credits, and airplane seat upgrades can really stack up. Even if the cashback offered by a travel rewards card is a little underwhelming, paying attention to the little things lets you focus on the card that’s right for your business.
Annual Percentage Rate
The one factor that’s likely going to determine the value of your credit card above all else is the
APR, or annual percentage rate. If your credit card is simply there to pay for expenses and then get paid down immediately, annual percentage rate isn’t going to be a big deal. But anyone who’s that financially comfortable is going to have better alternatives to a credit card anyway.
APR should always be a consideration when picking out a card, but it’s an especially salient consideration when you’re using your card for big expenses. If you’re purchasing a lot of equipment for your company or otherwise putting a lot on your card, the APR is probably going to offset a lot of the advantages that come from features like cashback rewards. Don’t just look at the standard APR for a card either. A lot of credit card companies will promise you 0% APR on your first purchase. And if you need to compare cards, Seek Business Capital can provide you with sensible analysis of all the options available to you.