The credit card business has proven to be a lucrative industry. A steady increase of credit and financing facilities being offered in the market today to keep up with demand has replied in the availability of various types of business credit cards.
In order to determine which business card is suitable for your business, you must go through the process of comparing and analyzing different credit cards according to your business needs and preferences. Here, there are a few things to consider in the weeding-out process. The following should be considered:
(1.) Annual Percentage Rate or the APR, as it is commonly called, usually expressed in annual interest rate. It is the cost of maintaining your outstanding balance past the specified payment period. It simply means that the lower the APR is, the better for your business since it gives you more leeway to settle your arrears at lower interest rates.
(2.) Annual fees and other bank charges. Due to the influx of business card providers, most banks waive the first 1-2 years of annual fees in order to attract more clients as well as provide reduced rates of bank charges, such as service fees and late charges.
(3.) Reasonable Credit Limit. A credit limit is the highest allowable amount you can spend in a specified period. The average specified period is usually within 30 days or 1 month while the average credit limit ceiling is around $ 50,000 to $ 60,000. Credit limits usually vary from one card holder to another and from one card provider to another depending on the card holder's capacity to pay, the nature of business and other factors the card provider may take into consideration.
(4.) To promote continuous card usage and patronage among clients, card companies offer attractive incentives and benefits such as airline mileage, freebies, increased credit limits, reward programs and cash-back guarantees.
In conclusion, do not just take business cards at face value without looking at individual features and characteristics. Most importantly, evaluate them using your business's criteria and discuss matters with your CFO and employees who are going to use the cards.