Jack Bauer
As a young and aspiring entrepreneur, one of the most challenging parts of starting a new business and take it to the next level is having inadequate cash flow for growth. Whether you’re considering opening a small retail shop or purchasing a sought-after franchise, have you ever thought about how a business credit card can help you manage cash flow and get your business off the ground.
Since you don’t need a perfect credit history or an established business to qualify, a business credit card can be a true companion in your business’ financing journey. It can help you get the working capital if you can’t get financing from other lending options. If you have a personal credit score of 690 or above – you can generally qualify based on your personal credit history.
There are a plethora of reasons to use a business credit card if you’ve just started or are thinking of launching your new venture. From building your credit score to maximizing available credit to boosting cash flow, business credit cards offer multiple benefits to startups and small business owners. Here are the top 10 reasons why you should use business credit cards for starting and growing your young business.
Mitigate Cash Flow Issues
Most entrepreneurs start their businesses on a shortening budget. A business credit card enables you to get regular access to cash flow and financial flexibility in the form of credit. It provides you the ability to make larger purchases that you can’t purchase with your personal credit card. This can make up your cash flow, making your business less subject to short-term waxes and wanes.
Build Your Credit Score
Business credit cards are a good first step towards building your business’ credit. No matter how strong your personal credit history, you’ll need to establish a credit score with the business credit bureaus. Making full and on-time payments each month can help establish and improve your business’ credit score. This later can allow you to secure more money at a lower interest rate and gain access to other small business financing options as well.
Keep Your Personal Expenses Separate
Keeping your personal and business expenses separate can make your life easier during the tax season. Moreover, it can help to keep accounting in order and maintain good bookkeeping. Having a separate card for your startup not only safeguard your personal and business expenses but also allows you to track your business spending.
Use for a variety of business purposes
It provides you the flexibility to use the money for a variety of expenses. Whether you’re looking to purchase inventory, equipment, supplies, office, or more, there are various smart ways to use a business credit card at a startup.
Final Thoughts
If your business is in the early days and you are searching for a good financing option to run and grow your startup, business credit cards can provide numerous important benefits to your company. But before choosing one, it’s vital to research and compare different options to determine which cards are best suited to your business needs. There are various lending marketplaces and software that can help match your business with a wide a range of business acquisition financing options.
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Jack Bauer
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Equity Credit Line (HELOC) is another form of equity financing.
You're still borrowing the money you've invested in your home, but instead of receiving it all at once, you get access to a loan against your current capital.
HELOC is like a credit card where you have a certain amount of money to borrow and repay.
You can get more information on heloc vs cash out refinance over the internet.Business URL: https://realestatediary.org/heloc-vs-cash-out-refinance/
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If you’re in the small business for a while, you have to let the bank or Credit Card Company know how much revenue your business is bringing each year.
Moreover, you may also be rewarded with everything from statement credits to gift cards to entertainment packages.
It can even let startups buy office equipment and supplies with their credit card points, which later help them reduce a lot of expenses.
You can keep a close eye on the total business spending, a particular employee each month’s spending, and the company’s specific department and project expenses.
Better Terms
Compared to personal credit cards, these cards often come with more spending power, bonus rewards on office supplies, lower interest rates, longer periods, and discounts for early payments.
A higher credit limit is beneficial for startups as they often both make more money and spend more money than consumers.
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