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The good news is: applying for a small business credit card is one of the easiest things you can do to improve your small business! But using that card effectively takes dedication. Fortunately, there are a few simple, common sense strategies that can maximize savings and cut abuse when you start using you new small business credit card.
Make Payments on Time, Every Time
If you've decided to finance your small business through a small business credit card, then you need to make credit history a priority! And the rules that apply for personal credit cards are equally applicable to small business cards. Late payments are not an option! Not only will they tarnish your small business's credit rating, you'll be losing money because of late fees! Paying your bills online and utilizing automatic bill pay are smart, safe ways to avoid late payments.
More isn't Always Better
There are so many amazing deals out there for small business owners in search of a small business credit card. And each new card seems to have a better rewards package than the previous offer! With credit card companies offering such competitive credit accounts to small business owners, it's easy to get lured into applying for multiple credit cards. But applying for multiple credit cards within a short period of time can actually bring down your small business's credit rating. Think before you apply!
Stick With the People You Know
While it's important to shop around, begin looking for a small business credit card at your current bank or financial institution. Having a preexisting relationship between your business and your creditor can come in useful. And it also makes your life easier when all your small business financing goes through one institution.
Take Advantage of Smarter Cash Flow
Some small business owners continue writing checks for transactions they could place on their small business credit card. But most small credit cards offer a 21 day grace period for all purchases made during a single billing cycle. Avoid potential cash flow hiccups by using your small business credit card instead of writing a check. But be careful! There's a difference between avoiding potential cash flow "hiccups" and charging your small business into serious credit card debt. Always take advantage of credit card cash flow relief responsibly.
Avoid the Cash Advance Trap
Cash advances carry credit card fees and unattractive APRs. If possible, simply avoid them entirely. If you do need immediate cash funds to meet your small business needs, a smarter option is to open a small business debit account.
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