Business credit cards are similar to personal credit cards however the account is held by a business rather than an individual. The fact there are so many providers of business credit cards shows that there is a demand for these types of credit cards. As more and more people look towards establishing their own small business they make use of credit cards as a source of funding for these ventures.
Besides the fact that they get the money that they need to purchase equipment and other supplies business credit cards provide a host of other benefits. In fact the benefits are more advantageous than using personal credit cards. A few of the main benefits include increased flexibility, low APR, higher credit limits, business rewards and of course built in accounting.
Although every individual has a preference the majority of business owners reveal that the ability to track expenses is the number one benefit that they gain from business credit cards. Paying a full time bookkeeper to do this would be a huge cost for the small business. Even if the business owner were to do it himself it would require a huge time investment. With business credit cards this is done automatically provided that all the business expenses are placed on that one account. Personal expenses must be placed elsewhere for this to be effective. After charging all the business expenses on this one card the account can then be paid off with just one check.
Business credit card providers are aware that expense tracking is an important need for business owners and they have done a lot to make this as convenient and simple as possible for business owners to keep track. They give business owners the flexibility of setting up how they would like to have their purchases classified. They can select from a number of categories or establish categories of their own and the charges will be allocated to these specific categories.
A few business credit card providers have even gone as far as presenting the transaction records in such a format that they could be easily imported into most accounting software. This alone is a tremendous time saver. Aside from that it saves the business the cost of paying someone to manually input this data. When tax time comes around getting everything together will be a lot less difficult and any tax consultant you hire would appreciate it.
As a final note employee purchases can also be easily managed when they are placed on this very same account. Separate cards with a preset balance can be issued to trusted employees and there would be no need for extra accounting since their purchases will also go on the same account.
The accounting benefits of business credit cards are real and they save both time and money for the business. Any business owner would appreciate these benefits that would give them more time to focus on the things that they really need to.