The ongoing pandemic has put a particular strain on many small businesses, leaving business owners in need of extra financing as well as new solutions to help their business transition online. A small business credit card can be a powerful tool in the arsenal of any business owner to help them solve any problems that arise between now and the end of the pandemic.
A different way to finance essential expenses
If you’ve applied for a small business loan, you know that the loan you’ll qualify for will be dependent on many factors including your business credit score, annual revenue and years in business. Particularly for new or very small businesses, it can be difficult to meet these criteria and qualify for the financing you need.
Business credit cards, on the other hand, use a different standard for applications. Unlike a business loan, they rely on a personal guarantee — that means even if your business goes out of business you will be liable for your debts.
On the other hand, that means business credit card applications rely on your personal financial history, rather than the financial history of your business. For some business owners with a stellar personal credit history, this may be the best option for getting a high, flexible line of credit without having to spend years building your business credit score or collateralize your home.
Having a business credit card can also help you build your business credit score, putting you in a better position for loan applications down the line — but be sure to check that your card issuer reports to business credit agencies, as not all do.
Make it easier to build your digital presence
While the transition to digital spaces may have been coming for everyone eventually, few people expected it to happen quite as quickly or urgently as it has in 2020. For small business owners, it can be easy to feel like you don’t know where to start when it comes to developing your online presence.
Many small business credit cards have unique tools to help business owners start building (or grow) their digital footprint.
That includes making it easy to accept digital payments, making sure your business has access to top of the line cybersecurity features, and providing access to a network of information about private and government funding opportunities.
Get travel and purchase protections
If there’s one thing business owners have learned from 2020, it’s that uncertainty is everywhere. That’s why the travel and purchase protections that business credit cards come equipped with can offer some much-needed security and peace of mind.
Travel and purchase protections are vital for two reasons: fraud liability and reimbursing you for delays, cancellations and emergencies that alter a planned trip. While an ounce of fraud prevention is worth a pound of cure, knowing that your business has zero liability for fraudulent charges can help you be comfortable taking your banking online. Additionally, flying right now is full of last-minute cancellations, which can easily result in an additional expense no business owner needs.
The right business credit card can offer more than just the financial flexibility to help you get through the pandemic — it can also provide peace of mind that you’ll rely on for years to come.
Staff, with data from iQuanti, Inc.