Cash Flow Protection

Choosing the Best Small Business Credit Card: Benefits & Features 

Why the best credit cards include more than just a form of payment and rewards.

Every business across different business landscapes incurs some kind of overhead costs that must be paid for to successfully run your company. When assessing your spend management  needs, you want to be thorough in searching for the best method of paying for them. Your individual business needs may vary based on many different factors: industry, use case, size of your business, number of employees, and cash back options.  

While there is no true “one size fits all” small business credit card, some options give you a multitude of features that can be customized directly to your specific needs. Some even have features that may give you more in return than you knew existed. 

The Difference Between Small Business Credit Cards & Personal Credit Cards 

The biggest difference between small business credit cards and personal credit cards comes down to how they’re used. It’s simple: personal credit cards are used as a personal line of credit for personal transactions. These transactions don’t need to be heavily tracked in accounting software; they’re separately used for personal expenses. Business credit cards, however, are meant to be used separately for business expenses so the two don’t get mixed up.  

Business credit cards are used in place of employees paying out of pocket. Based on the organization, business credit cards are passed around amongst employees as they incur expenses. They are tied to the business’s credit line but have nothing to do with the business owners’ personal finances. Each transaction on a business credit card must be tracked; the business owner or their respective finance team will often use third-party accounting software to reconcile these transactions for tax audits.  

Why is a Small Business Credit Card Important? 

Small business credit cards are important for businesses to have for a few reasons: 

  1. They give businesses a credit card to pay for expenses they incur while simultaneously building credit 
  1. They give employees an alternative to petty cash or reimbursement 

 Small business credit cards are essentially business credit cards for entrepreneurs looking to pay for expenses while managing cash flow and growing their business. In the early phases, companies often have a build-up period that lacks strong revenue flow. As their receivables are minimal, these companies still need to purchase supplies; typically, this line of credit can be paid down over time. At the same time, small businesses need to establish sustainable and strong credit. Why? It simply shows financial institutions a business’s and/or business owners qualifications for future loan funds as efforts continue to increase.  

On the other hand, small business credit cards are also a better method to manage spending and consolidate your business expenses without losing cash, employee reimbursement, or receipts. Instead of asking employees to use their own personal funds, giving them their own business credit card empowers them to save their own money and make purchases themselves. It also saves your bookkeepers time dispersing petty cash or writing reimbursement checks. 

How to Choose the Best Small Business Credit Card 

Most executives are familiar with traditional business credit cards: you apply for a credit line for your business, get approved/rejected, then start to use it for expenses you incur. As you spend, you earn rewards or cash/back. On the backend, your accounting department receives bank statements to verify where money is being spent, and the card is paid down over time. Depending on your company’s policy, employees can use this card on a need-to basis for their expenses. Afterwards, employees’ hand in their receipts from their transactions via an expense report or physically deliver it to their finance department. 

While these business credit cards are a viable option, there are better spend management ptions that allow for stronger transaction tracking capabilities. Some potential issues while using a traditional small business credit card: 

  1. Overspending  
  1. Limited transaction tracking  
  1. Higher risk of fraud 

Companies that utilize a traditional business credit card also take extra steps to manage their expenses. End-of-month bank statements aren’t a practical way to monitor real-time tracking, and physical or digital receipt collection via an expense report is more time-consuming than it needs to be. What happens when employees lose their respective expense materials? 

All in all, the best credit cards for small businesses typically aren’t the most traditional; they coincide with modern capabilities that can streamline business expenses from point-of-spend to the full accounting reconciliation process.  

Here’s what you should look for when choosing a new business credit card: 

  1. Credit cards with real-time transaction tracking 
  1. Credit cards with customized spend controls  
  1. Credit cards with budget setting capabilities  

Why Modern Small Business Credit Cards are a Stronger Alternative for Spend Management 

Modern small business credit cards offer a new alternative to traditional small business credit cards. Why? Mainly because they offer better spend management features that prevent overspending, limited tracking, and business fraud. These special features allow admins to give each employee a credit card while customizing how they can spend with them. They will also give admins the flexibility to load/reload an allotted credit limit for each employee wherever they’re located.  

Card Controls that Come with a Modernized Small Business Credit Card 

  The biggest value that modernized business credit cards provide to admins are more robust spend boundaries. These cards offer preset spend category features that make it feasible to eliminate any transaction approval process or concern of misused funds. It gives admins more control over where company funds are used. It also provides flexibility and takes the concern of the unknown out of employee spending.  

Benefits & features of small business credit cards with U.S. Bank Spend Management  

Modern credit cards for business with U.S. Bank Spend Management allow admins to set spend controls, set spend limits, and track transactions with  real-timereporting. Some additional modernized elements that U.S. Bank business credit cards offer for small businesses: 

Landscaping and construction business credit cards for construction pros 

Modern credit cards for business are typically used amongst all different kinds of industries. Given their versatility, admins can custom tailor them to fit the needs of any kind of company. Two, however, find them especially useful: landscaping and construction. 

Landscaping business cards

Landscaping business cards provide landscaping companies with lots of flexible capabilities. The use case amongst landscaping companies typically consists of using petty cash disbursement, out-of-pocket reimbursement, retailer contracts, or credit card sharing as means to pay for supplies. Given the various locations of each job site, as well as the number of crew members at each location, expenses add up quickly. They’re also difficult to keep track of when purchases are happening at such a frequent rate.   

Outside of points/rewards, a landscaping business card gives business owners a way to consolidate their company funds, eliminate those methods of expense payments, and streamline transaction tracking. Each crew member can have their own card for purchases with pre-set spend controls and spend limits. Learn about the best credit card for landscaping businesses here

Construction credit cards

similar to landscaping business credit cards, a construction credit card provide a top-tier alternative to out-of-pocket employee reimbursements or per diem handouts. Just as in landscaping, construction companies have multiple jobsites with multiple employees accruing materials. With this in mind, a construction credit card gives admins the ability for real-time transaction tracking and budget setting.  

The best credit for construction option also offers a consolidated credit card per diem meant to function similar to a cash per diem without as much of a risk of losing loose cash.  

The Bottom Line 

U.S. Bank Spend Management is the strongest credit card option for small businesses in every industry. Rewards are simply a bonus with the kind of real-time tracking capabilities that a spend management platform like this can provide. 

The use of modern small business credit cards outweighs the benefits of any traditional business card; newer options give businesses the best way to save time, money, and effort in all their business expense needs. The more that technology continues to advance, the more apparent it is that a spend management platform is a necessity.