According to a recent report released by The Economic Times, around 48.9 million credit cards were in circulation in India as of May 2019, a 27% YoY surge. Such an increased credit card utility in India isn’t solely for shopping and personal use, but also for several business operations.
Another report suggests that up until February 2019, the amount transacted with credit cards surpassed Rs.48,000 crore, amounting to both personal and business use. Looking into the increasing number of business units and their preference for such flexible financial tools, financial institutions offer cards that cater to various business needs.
Individuals can apply for business credit cards from any financial institution and avail funds for various business operations. Utilizing these cards not only provides them with the required finances but also helps manage business expenditure easily.
How are business credit cards useful?
Travel and expense management
Businesses that require employees to travel frequently can make use of a credit card as it comes with various lucrative discount offers, cash backs, etc. A dedicated credit card for a business not only saves them from the hassles of distinguishing personal expenses but also allows a company to earn more and save more on business expenses incurred.
Setting limits for expenditure
Credit cards used dedicatedly for business operations can help manage expenses better as they come with a pre-set limit. It isn’t the case with debit cards, and individuals may end up spending more than they should for various business activities even if they don’t intend to. Consequently, business credit cards are a must-have for enterprises if they aim to limit their expenses.
Earn reward points
Credit cards like Bajaj Finserv RBL Bank SuperCard offer attractive features such as reward points, on eligible purchases. Reward points as a welcome bonus and milestone bonuses can also be earned with the right card. Businesses can thus, simultaneously save while spending on various related activities. The accumulated reward points can be used for purchases at partner stores. Further, there are several other things to do with credit card reward points like qualifying for gift vouchers, availing cash backs, converting into travel miles, etc.
Utilizing online credit cards for digital transactions can also help accumulate multiplied points as online transactions are more rewarding.
Helps strengthen business credit history
Enterprises that apply for business credit card should use it wisely and make bill payments in full and in time. Ensuring that the credit card is used smartly will not only help with liquid funds when needed but also help build a strong credit history. Such records come in handy, serving as a yardstick of creditworthiness when businesses look for additional financial assistance such as loans.
Ease of payment saves time
Businesses don’t have to encounter any hassles when making transactions as they can do so online. It makes the process time-saving for businesses as a few clicks can complete the payment process for transactions. An online credit card accompanying the physical cards only makes such payments convenient.
Also, the availability of an online bill payment system facilitates ease of payment. Like, several financial companies let you pay credit card bills via payment app in one click.
Simplifies the tracking of business expenses
Businesses can have many day-to-day expenses to meet, like purchasing stationery, paying wages, and other substantial expenditures like purchasing raw material. It can get tedious to track all the expenses if they are made using different financial tools. Consequently, having a business credit card will help individuals track all their spending from one documented proof only, i.e., the credit card statement. They can further utilize it to determine strategies on how to manage the expenses.
Subsequently, individuals who apply for business credit card to utilize these benefits avail not only the ones mentioned above but also receive more features, such as
- Interest-free cash withdrawal.
- Conversion of substantial purchases into EMIs.
- Emergency loan on credit cards.
As for business credit cards, companies can make use of these features and manage their expenses with increased efficiency. Eligibility for a higher credit limit works only favorably as they can conveniently meet big-ticket expenses. It is thus ideal that you apply for a business credit card with a financial institution that maximizes these benefits.