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Corporate Credit Cards — Are They Right for Your Business?

by Jan Sheridan, Vice President Treasury Management Services

If you’re a business owner, you’ve probably received numerous offers and applications for a corporate credit card. But should you consider getting one? How might a corporate credit card benefit your business? Before you turn your next application into confetti, consider these facts about corporate credit cards.


A corporate credit card can help keep your company's expenses on track and obtain the buying power you need to operate your business. Much like consumer credit cards, many corporate cards also reward you for all your business purchases, either with cash back or rewards points. When you’re rewarded with each purchase, you’ll make the most of every business transaction. So how do you get started?


Obtaining a Corporate Credit Card
When establishing a credit card, the company's credit is considered, just as an individual's credit is considered when applying for a consumer credit card. Using corporate credit cards can also minimize paperwork. They typically offer convenient, online features, such as detailed monthly and quarterly expense tracking. Many also feature annual spending reports you can download directly into your accounting software. We’ll come back to that in a minute.


Build a Separate Credit History for Your Business
For a small business owner, mixing your business purchases with personal purchases is an enormous business accounting no-no, yet it's a common mistake. If you have a small-business credit card, keep it strictly for business and keep your accounting simple and clean.


While setting aside a specific personal card for business might help you avoid confusion, experts say that if you've formed a limited liability company (LLC), you’ll need to keep your business expenses separate from your personal expenses. This in turn can help you to keep your personal assets — such as your house — protected if you are ever sued. Having a credit card with your business's name on it provides proof that you operate the company separately from your individual finances.


A corporate card and its related online expense management tools can help you establish controls including:

  • Issue cards to employees with spending limits you control
  • View daily balances detailed transaction reports
  • Separate and control business expenses
  • Download transactions to financial software
  • Track expenses easily with monthly and annual reports and statements
  • Analyze your business spending
  • Employee expense management features, often including out of pocket expenses
  • Make payments

Take Your Card to the Next Level
A Corporate Credit Card can give your business access to credit and establish controls. When you’re ready to take your card program to the next level, consider Purchasing Cards, or PCards. PCards allow you to determine, based on merchant category codes, where your individual company cards can be used. There are many templates to choose from based on your employee’s needs or you can create your own template. For example, your sales force may have travel and entertainment cards, which would be authorized to purchase meals, fuel, rental cars, hotels, and airfare. Meanwhile, your facility manager would be allowed to make purchases at office supply stores and hardware stores, but not restaurants.


Ready to give your business a boost with a corporate credit card? Talk to your banker or call Jan at 402-323-1519 for more information.