Business Credit Card: The Facts 

You may be unsure as to the two differences between a typical personal credit card and a business credit card and at first glance, there may not be any difference but when comparing both, subtle differences begin to submerge.

Comparing the benefits of both before submitting any application is ideal as this will allow you to understand the difference in rates and underlying perks of having a personal or business credit card.

Anything from preferential rates to obtaining reward points on any purchases can be offered on personal or business credit cards but with organisations being linked to constant use of credit cards it can mean more competitive rates and benefits for both staff and employers.

When would a business credit card be required?

This is a good question as many individuals can be unsure as to what actually warrants the need for a business credit card and it is summed up where in most cases it will be required to cover essential purchases such as travel expenses and accommodation.

Even with this in mind, not all organisations (no matter how large or small) will offer a business credit card for essential and emergency use as items such as travel expenses and accommodation as this could be paid well in advanced or purely invoiced to the company.

If a business credit card is required then you will be informed of this by your employer but it is usually only in extreme circumstances that one is issued but the question needs to be asked, is a business credit card needed?

The answer is perhaps but it only comes down to the level of potential use it may require, should it only be used once yearly then this would almost certainly prove a waste of time and effort but if a business credit card was to used daily then this could lead to it becoming a very essential tool.

If my employer requires me to have a business credit card, do I need a clean credit rating?

The answer to this is not going to be yes in all cases but if an employer is going to trust you with a business credit card then I would say it is going to be important that you do have a good credit rating because in some cases, you may need to place the card in your name yet it is still for business expenses in which the company involved will re-imburse you later.

It may be completely possible that you are able to obtain a business credit card no matter what your rating as it is linked directly to the organisation and not to you but it could still pose a potential problem so mention this from the onset if you do have a bad credit rating because even if you do have a poor rating, it doesn’t entirely mean that you will be turned down it could just mean that the interest / APR rate for your business credit card is going to be higher than average and perhaps what you may have been offered should you not have had bad credit.

In most cases, companies won’t issue their employees with a business credit card if there is a sign of bad credit because whilst they don’t want to spark mistrust, it could prove risky at least in the first place to hand out business credit cards freely.