Business Credit Card Features That You Should Consider Before Applying

28 APRIL, 2022

Business credit cards are companions of proprietors and self-employed individuals. One may think that personal cards and business cards are the same. Well, there are many dissimilarities between business credit cards and personal credit cards. For instance, credit card bill payment offers can differ for business and personal credit cards. If you are to get a business credit card, you must know the must-have features. Many banks offer several types of business credit cards to individuals. You have to compare the business credit cards of different banks to choose the best one. Read on to know the things to consider before acquiring a business credit card.

Why You Need A Business Credit Card?

In this era, many digital lending platforms and banks offer business loans. One may think why there is a need for business credit cards when there are many financing options. Well, it is not always that one needs a business loan of INR 2 lakh or more. Business owners might require a way to cover their daily overhead expenses. For such scenarios, business credit cards are better than getting a hefty business loan on your name.

With business credit cards, you can open ways for better financing in the future. By using a business credit card, you can build a healthy credit report for your business. A healthy credit score in the name of your business can help you get future loans easily. Not to forget, business credit cards offer several perks and rewards that help you in times of poor cash flow. You can easily cover business-related expenses without disturbing the cash flow and business continuity. However, you need to choose a reliable business credit card to enjoy benefits and cashback offers.

Features to Consider For Business Credit Card 2023

Some features to look for while acquiring a business credit card are as follows:

Know your business credit card type

There is no compulsion that an incorporated business will only get a business credit card. Business credit cards are also offered to self-employed individuals. Owners of partnership firms can also apply for a business credit card. You need to look for business credit cards related to your designation. For example, small business credit cards are offered to emerging business owners or start-up owners. Small business credit cards offer special benefits to help emerging businesses grow. Gone are the days when freelancers faced hassles while applying for business credit cards. At present, every type of business owner can get a credit card. Choose a business credit card that relates to your business for better offers.

Know the employer requirements for business credit cards

Many banks offer business credit cards only to employers with a unique EIN (Employer Identification Number). If you are a sole proprietor, you may not have the employer status. In such a case, you need to check with your bank before applying for a business credit card. However, many banks in the country offer business credit cards to sole proprietors.

Know the eligibility requirements for a business credit card

You need to know the eligibility criteria for getting a business credit card beforehand. There is no point in getting your credit card request canceled for not meeting eligibility requirements. It is better to assess your eligibility before applying for a business credit card online. The eligibility requirements for business credit cards will depend on the bank. The general eligibility requirements for business credit cards in the country are as follows:

-You must be a freelancer, sole proprietor, partnership firm owner, employer, or business owner to get a business credit card.

-Usually, the age bracket for business credit cards holders is between 21 and 65 years.

-You should be filing an income tax return to get a business credit card. In India, you need to file an income tax return of at least INR 4.8 lakhs to acquire a business credit card.

There can be some extra eligibility requirements for business credit cards in India. Cross-check with your credit card issuer to know the eligibility requirements.

Know the interest-free period

The interest-free feature is a must-have for an ideal business credit card. Usually, the grace period for repaying a bill is more for business credit cards than personal credit cards. Many banks offer a grace period of 30–60 days for making business credit card payments. During the grace period, you don’t have to pay interest on your business credit card bill. It is helpful for small businesses looking to avoid interest charges and grow their business. Get in touch with your issuer and know the interest-free period for business credit cards.

Interest rates and rewards

Choose a business credit card that applies a fewer interest charge. You need to consider the daily interest rate of the credit card issuer before applying for a business credit card. A reliable bank will charge no more than 3.5% interest on outstanding balances on a business credit card. At the same time, you can consider the late fee charges of the issuer before applying for a business credit card.

You also should consider the perks and cashback offers before choosing a business credit card. Many business credit cards offer cashback for making payments. You can also get air miles, food coupons, movie ticket benefits, and more with a business credit card. Some benefits to look out for while choosing a business credit card are as follows:

-Airport lounge access

-Fuel surcharge waiver

-Train ticket benefits

-Air miles

Know the associated credit card fees

For business credit cards, several types of charges are applied. You need to choose a business credit card with minimum associated fees. Also, you need to consider some compulsory charges on business credit cards. Some associated charges to consider for business credit cards are as follows:

-Joining fees

-Annual fees

-Cash withdrawal charges

-Late payment fee

-Check bounce fee

-Over usage fee

Many banks allow you to apply for a business credit card online in easy steps. Acquire a business credit card in 2022!