When You Should Get a Business Credit Card Over a Consumer Card

By Jason Steele. Last updated 24 May 2017. 0 comments

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If you have a business, it’s worth considering a small business credit card. In some cases, the rewards and benefits mirror their consumer cards with little to no difference. In others though, the rewards offered by the small business card can be significant. And regardless of the rewards offered, small business cards can be used in other ways that will benefit you and your business. Here are five of the benefits that small business cards can offer over using a personal card. (See also: Best Small Business Credit Cards)

Enjoy Bonuses for Business Expenses

Just like the market for personal cards, there's a highly competitive market for small business credit cards. And one of the ways that banks compete for their business is by offering the most aggressive rewards for spending. With business cards, the rewards are more likely to be focused on common business expenses. In contrast, similar personal credit cards are more likely to offer bonuses for groceries and entertainment charges. Furthermore, the rewards earned from employee spending as authorized cardholders is retained by the primary account holder, increasing the opportunity for business owners to earn valuable points, miles, and cash back.

Separate Personal and Business Expenses

The primary benefit of a business credit card, and the reason they exist in the first place, is to separate personal and business expenses for the sake of record keeping and filing taxes. Can you use a personal credit card to do this? Yes, but the balance will appear on your personal credit report. In contrast, a business credit card's balance will not affect your credit score, unless you miss payments. As a primary account holder, you're still personally liable to pay back all charges on your business credit card.

Use Expanded Reporting Tools

Business users are likely to need additional information from their credit cards for accounting purposes, which is a feature provided by many small business credit cards. Get quarterly and year-end summaries that include custom, itemized reports of your spending. In addition, some cards offer downloadable purchase records compatible with common accounting tools such as Quicken, QuickBooks, and Excel. Mobile apps may also be available that allows cardholders to save images of the receipts and tag them with customizable categories.

Have More Control Over Authorized Users

If you need to give employees a card to use, business credit cards can offer better management, reporting, and control over their spending abilities. You can set up alerts on purchases, adjust spending limits, and view usage among different employees. Some consumer cards offer additional cards for authorized users, but it has the same card number and does not distinguish purchases between cardholders.

Earn Valuable Sign-Up Bonuses

One benefit that some credit card users find attractive is that they can earn increased rewards from sign the up bonuses offered by the business version of a card. When an exceptional offer comes around, it's often extended to both the business and personal versions of a credit card, allowing business owners multiple opportunities to earn this bonus. In fact, someone who owns multiple businesses may be able to apply for separate accounts for each one.

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