Business Finance

Five Ways a Business Credit Card Can Improve Your Cash Flow

Business credit cards are not just a convenient tool for making payments; they are a great feature to benefit your business comprehensively. If used wisely, that credit card can help you run a smooth business by getting more flexibility over the cash flow – particularly in stressful times. So, if you have been in two minds about whether or not to apply for a business credit card, here’s looking at all how it can help you.

#1 Get more time to pay the suppliers

Typically, business credit cards have a grace period of at least twenty-one days. So, you have at least three weeks between the purchase date and the payment date. In fact, in some cases, you have a month or even more to pay the suppliers. When you get a flexible repayment period like this, a business credit card naturally turns into a valuable tool to enhance the cash flow.

#2 No reason to tie up the personal credit

Now, you need that personal credit card for your purchases. But, as you start layering your business expenses on top of that, the credit card tends to get over-stretched, which cuts into both your personal and business cash flow.

With business credit cards, you have an extra payment tool to use. It can be helpful in the management of both business and personal credit. So, it can be used to protect personal credit as the business is leaner. But, on the other hand, it can help build the business credit history when you are actively buying on and paying off the card.

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#3 Paying the bills a lot more efficiently

As you pay using business credit cards, you get to spend the vendors on time instead of making your bookkeeper or staff cut cheques and drop them in person. In addition, being consistent with your payments improves vendor relationships. Maybe you can negotiate better prices in future or even secure jobs on a tight deadline.

#4 The undeniable power of rewards

Many business credit cards have lucrative cashback and other loyalty programs that help you improve the cash flow, cover your regular business expenses, and pay down the balance. Also, in-built rewards programs let you earn points for your business or reward the employees.

#5 Get a complete picture of the spending

While using business credit cards for all the business purchases, you get to see the details of how you are spending the money – all in a place. Based on the scope and size of the business, just a simple look at the statement gives you a complete view of the ongoing costs to run the business. As you have this information on hand, you are in a better condition to assess your spending choices and determine how and where you need to save money.

The bottom line

And that’s all! These are all how a business credit card can improve your cash flow. So, go ahead and apply now.

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