Keeping expenses simple

When employees incur frequent business expenses, for example through travel, hospitality, and fuel costs, business credit cards makes a lot of sense. You can easily track expenses and cross reference against receipts. An additional bonus is that business credit cards can be treated as an allowable expense for tax purposes. (However, always double check with your accountant as tax rules can frequently change.)

Managing cash flow

Business credit cards can be seen as a rudimentary form of revolving credit. The card can be used to pay suppliers and to meet other operating costs in the short term. These costs can then be spread over the following weeks and months. Above all, repayments are extremely flexible. You can decide to repay in full each month to avoid any interest costs, or you can just pay the minimum amount to help preserve your cash flow for the month.

Reaping the rewards

In personal banking, credit card companies attempt to seduce potential clients with points and rewards by linking up with schemes like Nectar and Tesco Clubcard. Exactly the same strategies are used in the business world, and there is an opportunity to cash in. Obviously, the average business is less interested in getting money off groceries. However, tie ins with hotel chains and airlines can result in some major reward benefits. There is nothing like an upgraded flight or hotel room to get the best performance from a sales manager! If it can be attained at zero cost to the business, then all the better.