A business credit card is a highly convenient way for you to access business credit. No matter the size of your business, you stand to get great benefits from having one. However, after getting a business credit card, the onus lies on you as to how you make use of it.
According to a report, 21[1] % of small businesses use a business credit card to meet their credit requirements. The benefits of owning a business credit card or SME credit card, as it is popularly termed, can only be reaped when you use it properly.
Here are some of the key tips to using founderscard in a better way:
Build a good credit score
Your SME credit card is a great tool to build a high credit score for your business. As payment history is a top contributor to the business credit score, using the card every month and paying off your bills on time can increase your score by a large margin.
A business credit score of above 750 can help your business get approval for large business loans with longer tenures.
Reap the most out of rewards
With founderscard, one of the best business credit cards for startups, you get 3x reward points on all transactions. You can redeem these points to get a wide range of business-specific rewards.
You can get rewards like WeWork discounts, Shopify benefits, and Google Ads cashback that help you reduce both your operating costs and overheads.
Pay your balance in time
When you use an SME credit card, you must always plan to pay your balance on time. Not paying it on time can incur additional interest and negatively impact your business credit score.
If you cannot pay the balance on time in full, you can opt for Minimum Payment Due (MAD), under which you pay only a fraction of the amount due, and the rest is carried over.
Use your credit wisely
When you have an SME credit card with a high credit limit, you may be tempted to spend all of it every month. However this can increase your credit utilization ratio and hurt your credit score.
The credit utilization ratio is the fraction of the credit limit available that you are using. You must always ensure to have an optimal credit utilization ratio to maintain a good credit score.
Monitor your expenses
As a business owner, you always have to keep track of your expenses, to ensure they align with your budget constraints. You can use founderscard’s mobile app to get regular updates on expenses, apart from periodic reports.
Moreover, with automatic categorization of expenses feature, you can easily identify the major areas of spending for your business.
Founderscard is one of the best business credit cards for startups to fund their working capital needs and pay for major purchases. However, the card can only benefit the business when it is used effectively.
If you are a small business owner and are interested in getting a founderscard for your business, visit www.founderscard.in to start the application process.
