Credit Card: How-To Choose A Corporate Credit Card

Credit Card... Tne way to handle bills for your business is to get a corporate credit card. While we're not suggesting you pay your rent with it, a company card can help with the start-up items and incidentals that inevitably come about. A corporate credit card also helps organize expense reports for your employees. There are many different factors that go into picking the right card, from credit limits and interest rates to payment periods. Here are some things to look for when choosing the right credit card.

1. Choose The Form Of Payment

There are two kinds of corporate credit cards that you can use for your company: business credit cards and corporate charge cards.

Business Credit Cards. A business credit card works like a normal card in that there is a credit limit and a minimum payment each

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month. It differs from a personal in that, when the card is given to the company, not only will the authorizing individual's credit be checked, but the credit of everyone who uses the card will be checked as well.

Corporate Charge Cards. On the other hand, a corporate charge is paid on a monthly basis with no interest, although monthly or annual fees are paid. If possible, try to get a card that has centralized billing, in which all usage charges are put onto one bill. It will save you from writing multiple checks, although you will have to confirm that all charges are for business use only (in case employees are taking advantage of the card).

2. Rate The Interest Rate (or Fee)

If you use a business credit card, compare rates to get the best one for your company. Keep in mind that many companies offer preview rates that go up dramatically after a short period of time (0.00% introductory APR until Monday!). Unless you want to change your credit card every six months to keep the low rates, try to find one that will have a low rate the whole time through. You won't get the basement rate, but you can find a happy medium.

If you use a corporate charge card, pick one that gives a base fee that is acceptable to your budget. The fees will vary greatly, and usually the ones with higher fees offer premium services. Check what services are offered and factor that into the fee to decide if the services are worth having.

3. Check For Bonuses

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As mentioned in the previous point, many cards offer premium services to make their cards more attractive. Whether in the form of airline miles, purchase insurance, rental car discounts or something else, decide which bonuses your company needs the most. For example, if your company travels a lot, then airline miles may be beneficial to you. However, airline cards and bonus service cards tend to have higher interest rates and fees.

4. Partner Up

If there is a company that you do business with on a regular basis, you may want to find out if that company sponsors a credit card. Many major stores and service providers link up with a credit card company to form a partnership. For example, if there is a gas station where you fill your company cars, getting that station's business credit card can help you earn free gas.

5. Pick A Card, But Not Any Card

business credit card Make sure that when you choose a credit card that it can be used in all of the regular places that you would use it. Check with the major service providers and suppliers that you use as to which credit cards they accept ("you mean, you don't take the Pokemon card?"). You might not find one card that covers everything you need, but you can at least choose the one that covers the most.

Once all of these decisions are made, you should be able to choose the right credit card for your company. Remember not to choose lightly, because the difference between picking the right or wrong card can affect the way you do business - and how much it costs.