It's common for entrepreneurs to use their personal credit card for their business expenses. However, this isn't the smartest or even the cheapest option. Once your business finds its footing, you can reap huge rewards by using a credit card exclusively for your business. This type of card is available against your current account or the account in which you do your business.
 

Here are the top-5 reasons why you must take a business credit card:
 

1. It increases your available credit options

If you want to take your business to the top, it's time to stop swiping your personal credit card for business expenses. The reason? You are limiting your credit options for personal expenses. Having separate cards will expand your credit limit.
 

2. It helps your business to build a credible credit history

Having a business credit cards the best way to build a credit reputation for your business quickly and  easily. Small firms and start-ups are often turned down when they try to avail loans. A business credit card establishes the credit rating of your business and can open up future financial opportunities for your business.
 

3. Easier to maintain separate tabs

If yourbusiness is a corporation or a private limited company, then it's vital that  you separate your business expenditures from your personal ones. When you mix these  up, you end up losing the legal protection that you sought by making your business a corporate or a private limited company. Keeping your expenditure separate is also good for tax accounting. When you file your company’s taxes, only the expenses you made for your business are deductible.
 

4.  Delegate spending to your employees, yet keep  a control on them

As your business grows, you are bound to add employees and delegate responsibilities. It becomes important for you to allow them some amount of buying power for company-related expenses. By giving business credit cards for your employees, you can achieve this, while keeping a tab on their spending.
 

5. Gain access to other financial products

As a small business owner, you are always on the lookout for new ways to fuel the growth  of your business. However, not many entrepreneurs are aware that they can make use of a business credit card to improve their businesses. Several credit card companies offer business credit card users the latest innovative business and tracking tools.
 

The other benefits of using a business credit card include:

  • Save time through the use of technology
  • Earn valuable rewards

As you start using your business credit card, you will discover even more benefits than the one listed here. So what are you waiting for? 

 

Disclaimer: Copyright Kotak Mahindra Bank Ltd.

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