How to Choose the Right Business Credit Card

By Rieva Lesonsky

Business credit cards can be a great way to manage your business’s cash flow, access needed capital for growth and provide an emergency backup plan for when money is tight. But what does a Smart Hustler need to know to choose the right business credit card?

1. Never use a personal credit card for business. Mingling your business expenses on your personal credit card causes a raft of problems, including the risk of hurting your personal credit rating, the fact that you aren’t building a business credit rating and the inability to write off the purchases as a business expense.
2. Look for a business credit card that doesn’t report to your personal credit report. If it does, any financial bumps in your business will hurt your personal credit.
3. Understand the annual percentage rate (APR). Business credit cards typically either have a low APR, or a higher APR with rewards. If you’ll maintain a balance on your card (for example, you’re using it to finance your startup), look for the lowest possible APR. Or get multiple cards and use them for different purposes—it’s a good way to make sure you always have the $100,000 in available credit that experts recommend.
4. Consider fees. Annual fees or penalty fees can add up fast, so make sure any fee you’re paying is reasonable and that it’s clear how to avoid penalties.
5. Consider perks. Business credit cards often offer perks like airline rewards points or discounts on office supplies. Look for rewards that are easy to earn and that you’ll actually use.
6. Assess reporting options. Business credit cards generally track and categorize your spending, but reporting options can vary. Make sure a card offers what you need, whether that’s customized reports or the ability to download reports into your accounting software.

Rieva Lesonsky is CEO of GrowBiz Media, a media and custom content company focusing on small business and entrepreneurship. Email Rieva at rieva@smallbizdaily.com, follow her on Google+ andTwitter.com/Rieva, and visit her website, SmallBizDaily.com, to get the scoop on business trends and sign up for Rieva’s free TrendCast reports.\

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