Many businesses use credit cards to pay expenses. It’s convenient and simple. The key is selecting the right card—the one that provides the most value in terms of rewards, be it cash back, travel points or lower annual fees. With so many options out there, it can quickly get overwhelming. Avoid the quandary of credit card analysis by asking the right questions from the start.

• What rewards program is most beneficial to our company?
  For example, if you and your employees travel a great deal, you’ll likely benefit most from a card that offers travel points and other perks such as free luggage check. Or, if you pay all of your expenses with a credit card, perhaps a card that offers cash back would be more valuable to your business.

• Will my card work when and where I need it?
  If you travel internationally for your business, remember that some cards restrict the number of overseas transactions. Credit cards are used for both purchases and emergencies, so don’t get caught with a card that may get “turned off” while you are traveling abroad.

• Will it show up on my personal credit report?
  If you use a credit card to charge a great deal for your business, it can affect your personal credit score. For example, carrying a large balance and late payments can negatively affect your personal credit score—while opening a large credit line you rarely touch can actually help improve your score. Either way, it’s good to know how the card vendor reports to the bureaus and if it will appear on your personal or business credit.

• How long is the grace period?
  A credit card can serve as a no- or low-interest loan for your business. If you plan to use it as such, you’ll want to find out the grace period for payments. The longer it is, the longer you keep the interest rate of the loan at zero. After the grace period, of course, you start paying interest. A grace period of 20-25 days tends to be ideal for many business owners.

Credit cards are an important tool within most small businesses. Be sure to select the one that best fits your unique needs by asking the above questions and doing the research.

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