There are many things to look for in secured business credit card offers. While revolving credit can be an excellent tool to assist with cash flow, it is essential that the agreement is thoroughly read and understood to avoid unnecessary fees. Below is a description of the information the business owner should look at before signing an agreement.

Interest Rates

The annual percentage rate needs to be spelled out for purchases, cash advances and any special rates that are being offered. For instance, there is a special rate of 0% on balance transfers, the length of time that the rate is in effect should be clearly stated, and as should the interest rate the card will default to after the introductory offer.

Fees

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Some companies have no annual fees while others charge upwards of $39 for carrying their card. If the business is taking advantage of a 0% interest rate offer, it might be cost-effective to pay a low annual fee if the interest saved during the special offer and the ensuing rates are low enough to more than offset the annual fee. Another charge to look for is a card holder fee charged for additional cards. This can be costly for businesses with several officers or employees that will be holding credit cards.

Collateral

Buildings, inventory or other assets can be used as collateral. Depending on the company’s size and length of time in operation, the credit card company might also require a personal guarantee by one or more owners or officers. This guarantee ensures the company that in the case that the property, inventory or assets devaluate and the business defaults on the loan, the guarantor or guarantors will be held personally responsible for repayment of the card balance.

There are many reasons for a business to use a credit card. Special low-interest rate offers allow businesses to pay down on debt at the lowest possible rate. Charging working expenses and paying the balance off every month is a way to, in essence, use the other company’s money for a month without paying interest. When cash flow slows, credit cards can offer an instant solution to keep the business running smoothly without a hitch. While many can come across the owner’s desk, knowing what to look for in secured business credit card offers can help the owner compare the offers and make the best decision to suit the business’ needs.

A business credit card is a type of credit card specially crafted for businesses. In general, the allowable loans from such credit cards are higher compared to a personal one and the rates fit that of a business. Depending on the credit card provider, there are different kinds of that fits any type of business – from small-scale and mid-sized businesses to corporations and enterprises.

Types of Business Credit Card

There are generally two types of business credit card – the secured business credit card and the unsecured business credit card. The term secured is taken from the credit card provider’s perspective and not from the cardholder.

The difference between a secured and an unsecured business credit card is that the former usually requires collateral like a real estate property, a business or shares in businesses. The latter doesn’t need any of those when borrowing money or applying for a loan. Given this nature, most credit card companies only issues secured business credit card especially to those who don’t have any credit profile or those that have bad credit standing.

In most cases, businesses usually start using secured business credit cards. Once a positive credit profile is established, such businesses move from a secured to an unsecured card at some point in time.

Benefits of a Secured Business Card

Despite the need for collateral, a secured business credit card has its own benefits. Usually, credit cards under this category have low interest rates primarily because its purpose is for businesses and it is secured by an asset from the card holder. Business transactions benefit heavily on this because the credit limit imposed in business credit cards are generally higher. This gives opportunities for high-valued purchases, support for business travels and other quick payments that will the operations of the business.

Things to Check

Prior to applying for a secured business credit card, you need to prepare collateral. This is typically a requirement of most credit card companies. Samples include real estate properties, business shares or the business itself and other similar ones.

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You also have to check on the fees and annual percentage rates (APR) of each of the credit card companies that you want to avail of. Include in your research the rewards, incentives and perks offered by the said credit cards. These information are generally available in the company’s website and other media. You can also visit the offices physically to have first-hand information regarding the product. A comparison among all of these will help you choose which one best fits your requirements.

Where to Avail of Secured Business Credit Cards?
You can visit the sites of some credit card providers below for more details on how to avail of their business credit cards.

Discover Business Cards

Discover offers perks for Small Business:

• Free employee cards with customizable spending limits and monthly reports
• Categorized online quarterly and annual statements
• The most complete set of free travel benefits offered by any no-annual fee card

Visa Business Credit Cards

• Visa Business cards are offered by the following Visa partners:
• Amegy Bank
• Bank of America
• Barclaycard US, Barclays, Barclays Bank Delaware, Juniper
• BB&T Bank
• Capital One
• Chase
• Citibank (South Dakota) , N.A.
• Comerica Bank
• Fifth Third Bank
• First Equity Card Corporation
• First National Bank of Omaha
• M&I Bank
• National City
• Pelican State Credit Union
• Regions Bank
• SunTrust
• TD Bank
• Tri Counties Bank
• U.S. Bank
• UMB Financial
• Wachovia Business Banking Center
• Wells Fargo Bank

MasterCard Business Credit Card
Offers different types of credit cards for small businesses, mid-sized companies, corporations and public sector.

American Express Business Credit Card
Has credit cards that suits personal, small-scale business and corporate needs.