Business credit cards have taken the world by storm over the last couple of years. A lot of small business operators have begun to realize the need for having an independent business account in order to better run their fledgling business. The following are a few of the advantages of a business credit card.
When you have two separate accounts, it helps you to better sort out your affairs. Doing personal transactions on a business account will not allow you to protect your business funds from personal expenses. It is important to have two separate accounts because you will need to make a billing of all your expenses at the end of the fiscal year and mixing personal and business expenses will result in a lot of confusion.
If you give out credit cards to your employees it will better help you to monitor their expenses. This is a lot more convenient than having them furnish bills and receipts for all the claims that they make. This way you can just get their statements mailed to your address and pay off all the dues if they are in order. This will also ensure that your employees do not indulge in unethical practices with regard to the billing procedure. Fluting up bills is a common practice amongst employees and this can totally be avoided if one follows such a practice.
When you start using a separate credit account for your business, you lend legitimacy to it. This is very important for start ups which are trying to make their presence felt in the corporate world. And apart from this, it will also help you to start building your credit history for the business. Every business is an entity in the eyes of the government. It needs to have its own credit record so that you can start asking for loans and grants from financial institutions on its behalf. Even for you start selling shares from your company; you need to show that the company has been doing something with its own funds.
There are several advantages of using a business credit account. The above were just the initial benefits that one can get out of getting one. But with time as the company grows, you can reap great benefits out of it.