BUSINESS CREDIT CARDS

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MBNA Business

Alliance & Leicester Business Card

Amex Gold Charge Card

UK Guide to Business Credit Cards

Once you have one, you'll wonder how you ever managed without a business credit card. It can help you with nearly every area of running your business, from accounting to travel arrangements.

Financial Control
One of the biggest benefits a business credit card brings is the considerable increase in financial control. It allows you to simplify and separate your business expenses. Eliminates the need to use a personal credit card for business expenses. It is like having an additional accounts assistant in your office, leaving you to focus on the things that you went into business for in the first place. A recent study by the Warwick Business School has found that business credit cards are the most widely used financing tool for small and medium-sized companies (Business Credit Cards and SME Finances).

Very often, business credit cards have very high no pre-set spending limits (providing you pay your bill in full and on time every month), making it easy to pay for business supplies and expenses on the spot. A business credit card facilitates business transactions made by phone and the internet.

Business credit card issuers often give up to 60 days in which you can pay the full statement amount, which can help your cash flow considerably.

The business credit card also does a lot of your bookkeeping for you, providing you with monthly statements. Some cards (i.e. Amex Gold) also provide free Annual Management Reports with an expense category breakdown on each card. The detailed and categorised statements assist with the preparation of annual expense budgets.

Even travelling abroad becomes easier and safer with no need to change significant amounts of foreign currency or organise traveller's cheques (see below for more business travel perks).

Fraud
The anti-fraud policy of most business credit card issuers will protect you at home and abroad. In this case, if your card is lost or stolen and the issuers are notified within a certain period, you will not be liable for fraudulent use. Some issuers (including Barclaycard Business, MBNA Business Credit Card) even provide Cardholder Misuse Insurance, to protect you in the unlikely event that employees misuse their cards.

Purchase Protection
Look for those business credit cards that offer purchase protection. Each time you use your business card to make a purchase you will automatically be covered for a period up to 90 days (depending on issuer) against theft, accidental loss or damage.

Supplementary Cardholders
Most business credit card issuers are happy to provide as many supplementary cards as you require. This is where the accounts time saved becomes very significant.

An important management control feature of business credit cards is that you can regulate the individual spending limits for each cardholder. Each business card on your account can have its own spending limit changed or cancelled at any time. You can even specify limits on different types of spend. The statements you receive from your credit card issuer are truly useful documents, detailing:

* types of expenditure clearly categorised

* breakdown for every business credit card on the account

* full particulars on every individual transaction on each card

Online Credit Card Account Access
Some cards (i.e. Amex Gold Charge Card) allow live online account access where you can check your balance, keep track of spending, view past statements and much more, whenever and wherever it suits you.

Travel Extras
Some business credit cards provide free worldwide medical and travel insurance (i.e. MBNA Business Credit Card, Alliance & Leicester Business Credit Card). Others have very useful travel service that can organise your trip with just a phone call (Amex Gold Charge Card). Right now if you open an MBNA Business Credit Card account, you'll receive 20,000 free destinations miles - enough to get you a return bmi flight to Paris, Milan, Venice, Madrid, Amsterdam, Nice and many more destinations. After that they give you one mile for every pound spent.

Purchasing Discounts
Many of the business credit card issuers use their huge purchasing power to negotiate discounts for cardholders on a wide range of popular business products and services. Example companies include Hertz, Viking Office Supplies, Regus, FedEx, Dell Computers, AA Breakdown Cover, Ryman Office Supplies, Best Western Hotels and many more.

Other Benefits
Look out for additional business card features. Amex are well-known for their Membership Rewards programme where you can earn points on your business spend, which are redeemable on anything from flights to fine wines to weekends away. Other issuers offer a free legal and tax help-line to cardholders (MNBA Business).

How to Choose a Business Credit Card
There are quite a number of business credit cards available, nowadays. Some companies simply choose a business credit card based on who offers the lowest APR, others don't need any credit and prefer to go with a charge card with extra benefits like rewards, airpoints or travel insurance. Here are some other considerations:

* Estimate the maximum amount of credit you think your business will require on a monthly basis as well as how much you can afford to pay off, then apply for that credit limit.

* If you have employees, you will need to decide exactly how many cards the business will need and which employees will require cards. It is not a decision to be made lightly - once you give an employee a business card you are endowing them with both the roles of product/service specifier and payment authoriser; ensure they are trustworthy.

* What is your business's need for ancillary services? For example, if you or your senior staff regularly travel on business you may be inclined to look at those issuers offering free air miles, hotel discounts and/or travel insurance.

* Consider all the other factors, such as whether there is an annual membership fee, and if so how much; overdraft protection; reporting by cardholder, rather than by account; whether they can customise the reports to match your own accounting categories; do you require an accompanying cheque book with the credit card

* Be wary of generous introductory interest rates - these are designed to tempt you and, after an initial period of between 6 to 12 months, can rise substantially. With business credit cards it is usually more important to place greater emphasis on the regular interest rate than on the introductory rate.

Special Note
Do not apply for a card offering more credit than you can afford to repay. If you default or fail to discharge the agreed amount, you can damage the credit rating of your business. Before issuing a business credit card, many banks will want to check that your business has a history of successful trading and has a good credit history. Be prepared to supply the appropriate documentation including accounts going back at least a couple of years and cash flow forecasts.

Personal Credit Cards

Featured Business Credit Cards

MBNA Business Credit Card

For both self-employed people and companies that need over 3 cards we like the look of the new MBNA Business Credit Card.

* Individual credit limits determined by you
* Advanced reporting to help you track expenses
* Free BMI destination miles (enough for a return trip to Europe)

Click for more info

American Express Gold Charge Card