When suppliers need paying, a project needs more investment or your day-to-day cash is looking low, a credit card can offer a quick cash injection to your business. They can help you manage your cashflow and spread your costs. They can also help you build a better credit profile for your business.
Businesses of any size are eligible for a credit card. However, companies that are start-ups or less established may find it more difficult. Your eligibility will also be based on your business credit score, and the credit provider will credit check your company to decide whether they’d like to offer a card and the credit limit.
Your business may also look at bank statements and repayment histories to check you can manage the credit card payments. Some may look at your personal credit score if you own the business.
It is known that credit cards have a good approval rate. You can check your eligibility in minutes here.
To be eligible for a business credit card you have to own a business or work for a business that authorises you to obtain a credit card for the company. You will also be required to have some business income and provide documentation about your finances and credit score to check your eligibility.
It’s important to note that all different providers may have their own eligibility criteria.
A poor business credit score can make accessing funding difficult. But the good news is, there are options available. We can help to match your credit and business with lenders. However, you may incur higher interest or repayment costs. Find out more about bad business credit loans.
If your business is growing, expanding or has a continuous flow of expenditure, a credit card could be a great solution for cashflow management and peace of mind. Especially, if you notice cash flowing out of the business more frequently than cash flowing out.
For example, if you are a business with long supplier terms where the businesses you work with pay you expenses back longer than you need to buy your materials, pay staff and overheads. A business credit card can help you protect your cashflow and spread expenses over a longer period of time.
Business credit cards can offer great advantages when you’re looking for some finance. Business credit cards often offer lower monthly credit limits than a business loan. They’re also more flexible and offer short-term funding, quickly to help you cover expenses that need to be paid now i.e. overheads, invoices, staff wages.
They can also help improve your business credit score over time, as it shows your ability to repay debts in a consistent way.
A business card may not be perfect in all cases i.e. capital expenditure or long-term financing. In these cases, you may prefer to look at a business loan.
There’s lots of different kinds of business credit cards available. We work with Cashplus, who provide one business credit card suitable for limited companies and one for sole traders.