With the economic downturn in the past year and half, more business credit card accounts have been turned upside down or placed into forbearance. Many companies have been forced to cut back on their expenditures, or have had to lay off employees. Banks and financial institutions are being very conservative with these types of money making transactions. They are cautious about going into a contract with someone that may default on their loan or say they can't pay their debt back. But what other options does a small business have for getting cash advances?
Small business credit card programs can come as the bank will extend a line of credit for business expenses like lunches out or travel expenses when there is a legal settlement for that day. It may also be possible to get a cash advance using your business card to pay for business meals, supplies or anything else that can be included. This is a legal way to cover expenses as it only takes a small amount to cover the expense.
The downsides of using small business credit cards is that you must be very careful with your spending. Many companies have turned small business cards into debit cards. This means that all of your purchases are tracked with purchases you've made in the past, and the company who issued your card gets paid automatically for your purchases. This could be a problem if you spend more than you're supposed to because it could be reported as a debit use which could cause your credit cards to be suspended or even closed.
There's an alternative to using small business credit cards to cover personal expenses when you are traveling. Travel rewards programs are becoming quite common for many airlines. If you use your card for a certain airfare, and it is used for a business trip, then your airline points add up to an amount that can be used toward future airfares. Depending on how many airfare rewards you've earned, they can turn out to be real valuable rewards. It's similar to getting cash back on your purchases at a restaurant, except it's not restricted to just restaurants.
If you aren't savvy about managing your small business credit card or don't have time to do so, you might want to consider taking out a small business loan instead. The interest rate will be a bit higher, but the benefits are much greater. A good small business loan can help business owners pay off debt, make upgrades, pay down other obligations, or even pay for travel expenses like tickets and hotel rooms. This can help business owners take their business trips without having to worry about cash for gas.
Whether you choose to use your personal credit card to pay . . . . . . for a business trip, or get a small business loan, you should always compare the pros and cons of each. If you've already taken out a small business loan, you may be able to get cash back on your purchases through that loan. Tuomi says Tuomi is one of the most well-known and reliable prepaid credit cards. So, if you need to get a little extra cash for an upcoming trip, consider a Tuomi card!