Business Credit Cards - Perking Up Your Business

Possibly the most confusing aspect of choosing a business credit card for a new business is wading through the seemingly endless lists of incentives and perks that are on offer to the small business owner. These can vary from things such as cashback deals on selected services and supplies to reward schemes that offer discounts on petrol or hotel accommodation. These perks are designed to benefit the entrepreneur and, ultimately, save the business money. This fact, however, doesn't necessarily make the selection process any easier.

In order to make the most effective choice, the business owner is well-advised to do a little 'homework'. Firstly, it is a good idea to work out just how much credit the business could and should require. This can be done by analysing the projected turnover of the business and weighing it up against monthly outgoings and expenses, such as wages and office supplies. Once these figures have been compared, it should be relatively simple to decide just how much credit would benefit the company and help begin the selection procedure.

Next it is worth considering just how the card will be used, by whom and for what. If cards are to be issued to employees, it may be worth considering a business credit card that offers the facility to 'cap' monthly spending on individual cards, giving the business owner more control over potential overspend. A card that comes with software to allow transactions to be tracked online can also provide additional control margins. Alternatively, the card may be used solely as 'back-up' in times of cash flow crisis, allowing wages and services to be paid for and giving the company cash account a period of grace whilst customer payments are processed. In this instance, a business credit card with an introductory offer of 0% APR would be helpful, as long as the APR that follows the introductory period is low.

When starting out, it is important that the business owner's personal accounts and the accounts of the business are kept separate, and most business credit cards offer this capability. This way, paperwork is kept to a minimum and all business transactions will have an online record of where and when they took place, as well as for how much.

Once the amount of credit to be borrowed has been decided upon, the next piece of homework is to figure out just how much the company can comfortably afford to repay each month. This can have a massive influence on which card is most suitable for a company; certain cards may have great perks attached but, if the interest rates involved are too high, there may be little point in pursuing them. Instead, it is better to focus on details that will constantly benefit the business, rather than on the money-saving advantages that may be of little use during times of economic stress. Having said that, the deals and incentives that are on offer can also be made to work for a business. If there are repetitive payments being made from a business to suppliers, for example, it can be worth sourcing a card that offers cashback or discounts on these services or products. Businesses that require a lot of travel from employees can also make savings on things like petrol, Airmiles and hotel accommodation. Once again, the question, "who will use the business credit card and for what?" becomes very pertinent.

Business plastic can be a very dynamic and useful tool for any company. By continually questioning its purpose, the entrepreneur can build up an 'identi-kit' picture of just what the card ought to do for the business and find the one that corresponds with those requirements.


Credit Card Care

As we sit in the midst of a credit crunch, many consumers will have concerns about their finances in one form or another. Uncertainty in the markets has meant a reduction in spending on the high street and increasing numbers of calls to debt advice help lines.

With Christmas just around the corner, many will be looking at methods of saving money - whether it is cutting back on essentials or taking out further financial products in order to help the cause.

Of the financial products available on the market, credit cards are one of the most widely available. These handy cards can help you spread payments on purchases and pay it back over a period of time, which can be useful when it comes to purchasing Christmas presents.

Interest free credit cards are useful for when you need to make big purchases, such as electronic goods, by allowing you to spread the cost over many months without accruing any interest payments.

But if you're not careful, credit cards can bring with them a few pitfalls that can have an adverse effect on your credit rating, as well as increase your debt levels.

And with more companies becoming more stringent about who and how much they lend money too, getting a credit card in the first place is becoming increasingly difficult. If you're not financially secure enough to afford to add another card to your wallet, it's best to think about getting your finances in order before committing to further deals.

As tempting as interest free deals sound, they also come with limits, and a common mistake with credit cards is to go over your limit on the card, which will practically invalidate your 0% interest rate and return you to the usual APR rate. Indeed, this can be more severe in the case of store cards, which usually have a much higher APR rate than many credit card companies, and overspending on these can prove to be very costly if you don't keep an eye on your finances.

Research is a key part of deciding which cards are best for you, by taking the time to analyse your finances and tidying up your credit rating before shopping around for credit card deals you can help increase your chances of a successful application.

If you feel you need a credit card for those little financial emergencies, or are just looking to spread payments, ensure that you pay off your balance at the end of each month. Not only will this help give you piece of mind when it comes to settling your debts, but it will also help to keep your credit score healthy.


Will Closing My Credit Card Account Affect My Credit Score?

People often think that if they pay off a credit card or don't use an existing card and then close the credit card account that they'll get a better credit rating or raise their credit score. This is not the case and here's why.

Let's say you have two cards or more from the same credit card company. You do not want to close these accounts.

Credit scores are determined by what types of credit you have and how long you've had your accounts open. They look at your payment history too. Even if you've had a credit card for 15 years or more and have an excellent credit rating, FICO score and credit history and you go ahead and close it, you can do a lot of damage to your credit score, and especially if it's the card you've had the longest and it's still an open account.

No matter how many credit cards you have, and no matter what your credit history is, no matter how many payments you've made on time or not on time, no matter how many late fees you've paid or not paid, it doesn't matter. The standard advice from the experts is NOT to close any credit card account.

If you are working on bad debt credit consolidation you don't want to close your accounts.

Let's say you are paying a high annual fee on a credit card and that may be reason enough to want to pay it off and close the account. Don't do it. First contact the credit card company and ask them if they will demote (use this word when you ask) your card to a card without any annual fee. That way you can still keep your credit rating and FICO score intact and you'll avoid paying the higher fee as well.

You can do this by calling the company's toll-free number. Ask for customer service.

In any event no matter what happens when you call customer service don't close the account. You can always ask for a supervisor and if you still don't get anywhere then ask for the customer retention department. This department is not common knowledge and they have a lot more power to give you what you want or need.

Of course you want to do everything in your power to keep your rating up and as high as possible. But getting rid of or closing a credit card account will only cause a possible drop in your rating or credit score. Make sure you get your copy of your personal free annual credit report online to check the status of your accounts.


Who Qualifies For a Merchant Credit Card Cash Advance?

Among the other important factors to be considered when applying for a merchant credit card cash advance, one must consider the average size of each transaction of his or her company. One might ask him or herself why this is of any importance at all to the funding source making the advance. The answer is actually a fairly commonsensical one.

To illustrate the significance of this data, let us use two examples, both of which are seeking a merchant credit card cash advance of $20,000.


The first example shall be that of a local diner. Let us suppose that said restaurant averages $20,000 per month in credit card sales. We have all been to diners, so let us assume that the average cost of a meal paid for by credit card is $30.00. This means that in a given month, to maintain the level of $20,000 in sales, the diner would have to serve 667 meals at the average cost of $30.00. Achieving that amount of turnover and sales would seem to be quite a daunting task.


For the purposes of this discussion, let us say that the second business is a high-end furniture store. This store, which sells custom made pieces, averages $80,000 per month in credit card sales. The furniture is sold in sets, however, so the average cost per transaction is $8,000. As you can guess, this means that the store would have to make only 10 average sales to maintain its monthly average of $80,000 in credit card transaction.


As we have discussed in previous posts, the advances are repaid to the funding source on a per-transaction basis. This means that the funding source will hold back a percentage of each transaction - anywhere from 8% to 25% - until the advance is repaid. Common sense would seem to dictate that it would be easier for the high-end furniture store to make 10 sales than it would be for the diner to make 667. Therefore, the furniture store is the apparently obvious answer.

But we must delve further to better understand who the more qualified candidate for a merchant credit card cash advance is.

While the diner has to do more volume, the relatively small size of the sales makes it impossible for any one, two, or even fifty to materially affect the income of the restaurant. This is not the case with the furniture store. A decrease by only 5 sales would cut the income of the store in half, affecting its ability to repay the advance. Now, while funding sources understand and account for the fact that some months are slower than others - resulting in less being repaid in those months - they like to hedge as much as possible.

Thus, in the end, the diner is the better candidate for a merchant credit card cash advance than the high end furniture store. This is not to say that the store would be summarily rejected for an advance, but it would certainly be more of a challenge to find a source. So if you are considering a merchant credit card cash advance, understand that smaller ticket items sold in greater volume are looked upon more favorably than higher ticket items sold as in lower volume.


Lies, Lies, Lies - How They Trick You Into Amassing Credit Card Debt

Credit Card Debt Lie #1

You Can't Live Without Credit Cards

The reality is if you are depending on credit cards to fill the gap in your pay or take care of emergencies, you are waltzing right into the credit card debt trap. You may feel that you can't live without credit cards but the truth is, you can. It may take a major shift in your spending and saving habits, but you can do it. Most people don't know that credit card debt is the number one factor that leads to debt trouble. That is until their plastic money runs out and their massive debt load starts to resemble Mount Everest.

Credit Card Debt Lie #2

You Need Credit Cards For Emergencies

One of the greatest debt accumulation lies ever told is the one about credit cards being great for emergencies. Time and time again, credit card holders convince themselves to apply for a credit car for emergency purposes only. But what they don't do is properly define what an emergency is. Is it a one in a lifetime sale on a Flat Panel TV? Is it a buy a sofa, and get the loveseat for free deal? As it happens, the majority of individuals start using their plastic money for the basic necessities of life: grocery shopping, paying bills, gasoline, ordering products online, entertainment, etc. You know the rest of the story; eventually they amass thousands of dollars in credit card debt they cannot afford. Now they are having a true emergency, how do they pay those bills before the debt collectors start calling?

Credit Card Debt Lie #3

No Money Right Now? No Problem! Just Charge It!

When the "get it today, pay tomorrow," ads first appeared on the scene, the average consumer didn't see this economic Tsunami rapidly heading their way. The ads touted some pretty tempting benefits. You could extend your buying power by 30 days or more, get 0% interest and receive credit card rebates with every purchase. The best one of all is the one were there's no payment for 12 to 24 months! Like lambs to the slaughter, people bought rooms full of furniture on credit and charged thousands of dollars in purchases to zero percent credit cards. The thinking was, when tomorrow came, they'd be in much better financial shape. By the time tomorrow came, their credit card debt was totally unmanageable. There was simply not enough income to pay all of the minimum monthly payments and take care of their households. That's when they realized what a massive mistake they made in believing that lie.

Credit Card Debt Lie #4

You Need Credit Cards To Have a Good Credit Score

Smart consumers realize that the credit and finance industries worked together to create what we now know as the credit scoring system. What they may not know is this is a perfect example of social engineering. Unbeknownst to the average consumer, this system was engineered to steer consumers into accumulating debt. Have you ever read some of the credit score printouts? Did you notice how they suggest certain actions to improve your credit score? Actions such as:

1. Request a credit line increase

2. Never close unused credit cards

3. Never leave any credit card unused for a long period of time, and

4. To increase your credit score, open one or two more accounts.

Each of these actions requires a person to take on more debt, (whether short term or long term) in order to increase/improve their credit score. The only ones who win when consumers increase their debt load are the credit card companies and those involved in the debt industry.

Credit Card Debt Lie #5

We Have Great Payment Plans

It shouldn't take a mathematical PhD to figure out that there is no such thing as a great payment plan. In the final analysis, credit card debt is extremely costly. For example, let's say that you ring up a balance of $5000.00 at 14% APR. If you were only making the minimum payment of 2%, it would take you approximately 22 years and $5,887.00 in interest payments to pay off this debt.

That means you would have paid more than double for the items you bought. The credit card companies love it! You literally work for them, for the next 22 years of your life. When it comes to credit cards, don't believe the lie, there is no such thing as a great payment plan.

Credit Card Debt Lie #6

Every Time You Use Our Credit Card You'll Earn Points!

This is another slick tactic credit card companies use to bait people into accumulating credit card debt. It starts off innocent enough. To get points, a person starts charging little bitty things such as breakfast and lunch at fast food restaurants, gasoline, trips the store and other little nick-knacks.

These are things they should be paying with cash. The next thing they know, those $4.00, $6.00, $10.00 and $20.00 charges have added up into the thousands. It happens so fast most people never realize what's happening. Yes, they got the points, but they also accumulated more debt in the process.

If you have fallen for any of these credit card debt accumulation lies and realize what a monumental mistake you've made, congratulations! You are now on your way to breaking free from the all-consuming debt trap.


How to Become a Pro Credit Card Finder

Financial companies have mastered the art of direct marketing. If you have been living in the United States, you have probably received lots of credit card offers in the mail. There is such a case as having too many options. Card companies are constantly trying to up one another by offering more lucrative deals to their prospects. Having alternatives is not a bad thing, but when it comes to credit card, one needs to do the proper due diligence to avoid signing up for the wrong offer.

In order to find the right credit card, one needs to have a plan. In other words, you need to know what exactly you are trying to get from your next card. If you are looking to get cash rebates at the end of each month, you need to look at cash back cards. If you are hoping to save money on your air travels, then you should look into airline card offers.

Research has shown that most prospects settle for cards that come with the lowest APR on the surface. But a lot of these folks fail to due the proper due diligence and end up signing up for offers that come with hidden fees.

Financial institutions are notorious for hiding certain facts about their offers. If you have taken a look at credit card applications, you have probably the small-font lines that are put right at the end of each application. Card companies know that a lot of folks don't look there, which is why you can expect to find hidden and miscellaneous fee there.

A pro credit card finder will go through the terms and conditions of each offer to make sure she don't fall for hidden/misc fees. You should also try to figure out if you qualify for a credit offer by going through credit comparison sites. A few of these sites provide information on the credit score range you need to be approved for an offer.

A credit account can help you build a better credit reputation and receive lower interest rates on your future purchases (e.g. car, house). But the wrong credit offer can not only bring you headaches, but also affect your credit score as well. In these tough economic times, the last thing one needs is dealing with a dishonest card issuer. By doing the proper due diligence, you can make sure you get the biggest bank for the buck from your card.


Save Hundreds of Dollars by Getting the Best Credit Card Deals

Do you always see those credit card commercials on t.v. with all those great rewards and you're thinking, "What? I don't get any of that stuff with my credit card!" It kind of leaves you with an empty feeling - doesn't it? Like you're being taken advantage of by your big credit card company; like you're missing out because other people are getting better deals. You just know you could save hundreds of dollars if you switched to one of "those" credit cards. This article is going to take a look at how you find the best credit card deals and see if it's really possible to save hundreds of dollars by getting the best credit card deal.

The best credit card deal for you, if you don't pay your credit card off every month, is a low rate or low fee card. There are several cards offered by Visa and one from American Express that have a 0% balance transfer fee. This by itself will save you hundreds of dollars. If you have a large balance riding on your credit card, don't ever switch to a new credit card that is going to charge you a transfer fee - no matter how much they tempt you with rewards and promises of money back. I guarantee you that the money they are supposedly going to give you back will not amount to the transfer fee they will charge you upfront.

If you pay your credit card off regularly, you can actually make money with several of the cash-back cards. American Express has one card that pays you 5% back at grocery stores, gas stations, and drugstores and 1.5% cash back everywhere else. Wouldn't that make you feel better? I don't know about you, but anytime I can get something back out of a big corporation, I feel much better.

Capital One also has a good credit card if you are one of those great money managers who pays their card off each month. With this card, you get 2% cash back on gas and groceries. Discover has a card that gives you 5% back up to $400 per quarter. I think it's safe to say that with these cards, you can definitely save hundreds of dollars by getting the best credit card deals.

With gas prices the way they are these days - up, then down, and then who knows - you can appreciate a gas card that you will get rewards with. Chase, PerfectCard, and MasterCard, have the best deals on these with 6% rebate on gas for the first 90 days and then 3%. They also give you 0% APR on new purchases for up to six months.

With the information in this article, it's easy for you to see that it is possible for you to save hundreds of dollars by getting the best credit card deals. These deals are easy to locate on the internet and you can soon be saving hundreds of dollars.


Should High School Students Have a Credit Card?

The younger students mainly in their teens are now the flavor of the credit card companies. They are now being targeted by these companies by providing them with the high school student credit cards or popularly known as teen credit cards. These are mainly the prepaid or secure credit cards in which the money is preloaded onto the cards. The teenagers can only spend the amount of money that is preloaded on the card and not beyond that limit.

The high school students are falling into the trap of credit card companies because they are those set of population of who spend more amount of money and not have required amount of knowledge about borrowing and to use a credit card. Teens are now becoming more powerful customers and are often trusted by their parents to take most of the purchase decisions. Credit card companies mainly encouraged by those numbers have saturated the adult card market and now eyeing the younger high school students.

A student interested in getting a teen credit card must first open a prepaid credit account by depositing some money into that account. The student is then issued a prepaid credit card once he has deposited the money in the prepaid account. The prepaid credit card can be used anywhere. It is just same as using a regular credit card. A student cannot spend any more until he makes further deposits into his prepaid credit account.

These days, parents also provide teen credit cards to their children's in order to ensure that they will overspend as they will only be able to spend the amount of money that their parents have deposited in their prepaid credit account into the bank. The use of high school student prepaid credit cards is generally very prevalent among the students nowadays. The students use the prepaid credit cards to learn the credit building ability and also learn good money management skills.

The parents can help students a lot in building money management skills of the students. They both must discuss what types of purchases are appropriate with a teen credit card. It is important to consider that the appropriate purchase excludes anything that a teen can eat, drink or wear. The main motive behind this is to inculcate the habit of savings and using credit card wisely. Thus, the students must be responsible enough to use their card wisely otherwise their credit score can plunge very quickly, which is not good for their credit history in the long run.


Business Credit Card - Why Get One?

The most obvious reason for getting a business credit card is so that you will have cash available when you need it. A business credit card is simply an immediately available loan. There are often unexpected expenses in business, and sometimes you just don't have the cash to cover them. For example, perhaps you have a high deductible on your car insurance, and you just can't come up with the extra $1000.00 needed immediately for repairs. Or your computer quits working and you've got to replace it right away. Having a business credit card simply makes it possible for you to handle these types of emergencies right away. Of course, these examples would apply to a small business, but having ready cash available may be even more important to a larger business. Maybe the opportunity to make the expansion for which you've been striving for years comes up, and you've got to have that extra cash to make it a reality. If you don't really have the time to go through all of the steps to secure a loan, having a business credit card could enable you to make the expansion (or at least start it until other financing can be obtained).

Secondly, a business credit card can improve accounting in your business. For example, you could get individual credit cards based on your expenses. Some businesses issue individual credit cards to each of their salesmen. That way all of their expenses can be tracked. It's simpler than requiring them to turn in all of their receipts, and their spending can be monitored easily. Or if yours is an individual business, it could be used simply for your own travel and client entertainment expenses. One card could be used for all of your office supplies, another could be used for building supplies (if you're a contractor, for example), landscaping supplies, art supplies, advertising, etc. This, of course, would depend upon your business. One card might be sufficient for all of your expenses. I would plan on paying off these cards (or one card if that's what you decide) every month. (If you're getting into debt on your regular monthly expenses, you'd better take a real hard look at your business and cut some expenses soon -- you're losing money!) Of course, this second function could be done with a debit card. The only differences being you don't have to worry about being overdrawn and paying overdraft fees and you do have credit available for unforeseen expenses.

Hope this information has been helpful.


Do We Really Need Credit Cards?

I wonder how many people reading this article are old enough to remember S & H Green stamps? These trading stamps made a small fortune for Sperry & Hutchinson back in the fifties and early sixties. Consumers felt they deserved to get the stamps with everything they purchased from gasoline to groceries and merchants felt they had to offer them or lose out to competitors. Then one day, everybody woke up and realized this was a middle man raking off money on every transaction and that it was costly to both business and consumers. Thus S & H Green stamps became obsolete.

Today we have a similar situation with credit cards. I recall in the fifties when you could go into a retail store and buy a television set and the merchant himself would carry the credit, at reasonable terms. Now most retailers accept credit cards on purchases, even if you are making small purchases. Like S&H Green stamps, this is costly to consumers and businesses alike.

A merchant will typically pay from one to two percent of every transaction to the credit card companies. The credit card company gets it from both sides because they also charge the consumer interest rates of upwards of 30 percent. In addition they make excessively high fees for over the limit fees, late fees and whatever else they can add in.

Have you ever wondered why it is so easy to get a credit card? Why is it that credit card companies don't worry about whether or not you can pay? Here's the answer. If you default on your payment, the merchant still has to pay. The credit card companies can't lose but the merchant can.

Credit card companies have done a real sales job on convincing consumers that they can't live without credit cards and in convincing retailers that they must accept credit cards to remain competitive. The U.S. financial crisis, which was largely caused by credit card companies, might be just what we need to wake us up to the fallacy in these ideas.

Suppose merchants went back to the old method of granting credit themselves, and suppose more consumers went back to the old way of simply paying for merchandise with cash and only buying what they can afford to pay? It might solve a lot of problems.

One last thing retailers should ask themselves is what do they get for the one or two percent they are charged? Security? Not likely since they still have to pay if the consumer defaults. In the old days businesses included a percentage in their pricing to account for the possibility of bad debts. You can bet the credit card companies also keep this in mind when they issue credit and they simply pass that cost on, either to the merchant, or the consumer, or both. Aside from the one or two percent the merchant loses when he allows credit card companies to handle his credit transactions, the merchant also loses the interest he could be charging the consumer directly. If, for example, a merchant were to charge simple interest of ten percent per year on a major purchase, he would receive more money than he could receive by putting that money into a certificate of deposit and the consumer would pay far less interest than he would be paying to a credit card company.

Consumers also have been led to believe they can't do business without credit cards. In spite of what you are told, there are car rental companies that will accept a cash deposit instead of a credit card There are companies who will sell you merchandise online without a credit card One option is a debit card, although there are similar issues with debit cards as there are with credit cards. Some banks offer electronic checks and a few online merchants (too few) offer the option of billing you and allowing you to pay by check. The fact is, if enough consumers demand other answers, online merchants, car rental companies and other businesses will find other ways to allow you to pay. You don't have to have a credit card.

If credit card companies were cut entirely out of the picture, it could be a win-win situation for merchants and consumers alike.