Man paying with credit card on smart phone at home office. Concept: how to choose a credit card
Max Cordova
By: max
Read in 8 minutes

How to Choose a Credit Card for Your Small Business

As a business owner, it’s important to understand the various financial options that are out there when it comes to growing your business. This can start with determining which credit card is best for you, as credit cards offer many benefits and flexible options. But, how to choose a credit card for your small business? Have in mind that the decision that you make today can impact the financial health of your business down the road. Therefore, take some time to learn about which credit cards are available based on your needs and the needs of your business.

If you’re unsure about how to choose a credit card for your business, Camino Financial can help.

How to Choose a Credit Card – Ask Yourself These Questions

Choosing the right credit card for your business can be overwhelming. In order to find the best fit, ask yourself some questions.

●     Are you looking for a credit card with 0% APR?

Credit card companies make their money off of interest, or APR (Annual Percentage Rate). The higher the APR, the more interest you’ll pay on your credit card payment, especially if you do not pay off your statement balance every month. This can cause you to go into more debt quickly, which can no doubt impact your business.

Most credit cards have an interest rate of around 20%+, but some cards have an introductory APR of 0% for the first 12-18 months.

Learn more about zero interest cards and access a list of the best ones.

●     Do you mind paying an annual fee?

On top of the APR, many credit card providers charge an annual fee. While paying an annual fee may seem like a burden, the benefits that come with it aren’t all that bad. For instance, you may pay $95 or $150 for the year in annual fees, but, in return, you’ll receive loads of benefits such as travel insurance, car rental insurance, and even airport lounge access. This makes paying an annual fee worth it.

If you’re not interested in paying an annual fee, consider this Chase Ink Business credit card. If you don’t mind paying an annual fee, make sure you read the benefits of the card first in order to make sure you’re getting your money’s worth. This American Express Business Platinum Card is a good example.

●     Do you travel often for business purposes?

For some business people, traveling is a major component. The benefits of choosing a business travel card can give you and your business a lot of perks if used smartly. Some of these perks might include lounge access, TSA pre-check, and reward points which you can apply to future business travel.

Another great perk that many travel credit cards have is no foreign transaction fees. When you use your card abroad, you won’t need to worry about the fees. You will be able to confidently spend and earn points, without racking up more debt. An example of a great travel credit card is Bank of America Business Advantage Travel Rewards World Mastercard.

●     How important is it for you to get rewards?

Depending on your business, certain cards and their rewards might be appealing to you. If you are running a trucking company, for example, then you might want to consider a credit card that offers you and your employees 3% back on gas stations. A card with great reward point benefits – outside of travel alone – is the American Express Business Gold Rewards Card.

●     Do you want to add an authorized user? 

When you are running a business, you may need other staff to run out and buy supplies without you being there. Getting a card that allows you to add an authorized user – who will be covered by the same policies as the account holder – is great for business. By having another user, it can help you run your business more efficiently.

For example, if you are on a business trip but can’t be there to physically make a purchase, you’ll be glad to have someone else that is trusted to make that purchase for you. Most cards allow you to add an authorized user, but just read the terms before taking out the card. Sometimes, you have to pay to add this user.

●     Do you want cash advances?

Some credit cards allow you to do a cash advance, without ridiculous fees. Being able to get your hands on a decent amount of cash that you may need to make a purchase or fulfill an order, can make a huge difference in how you run your business. That being said, if you are in need of a lump sum of cash, then a loan may be a better option.

Other Things to Consider When Getting a Credit Card for Business

When considering how to choose a credit card, you’re not only making decisions for yourself but for your business as a whole. Having a credit card is a big responsibility that’s not to be taken lightly. Though credit cards can provide many benefits, they can also lead to financial problems if you do not properly manage them. Interest can add up quickly, which can affect your credit, trickling down to other aspects of your business.

Because of this, it’s essential that you consider all the pros and cons of applying for a credit card and really think about what this credit card will do for you. If you feel that your needs won’t be entirely met just with a card, then looking into a loan to finance your business may be a better option.

The Bottom Line

If you still can’t decide on a credit card or you can’t find the right one, consider Camino Financial as an option instead. We offer small business loans to businesses that are on the right path to success but need a little help getting there.

The process is simple, quick and transparent, so you can get the capital your business needs right away. Unlike credit cards that are not always transparent, we offer fixed monthly payments and fixed interest rates. There is only one closing fee and there are no other hidden fees, so you know exactly what you’re paying for and you can get back to work.

Contact us today for more information about getting a loan.


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