When the economy struggles and default rates increase, lending standards can get mighty tough, especially for unsecured micro-loans. Banks may continue to court small business during these times, but borrowing will be an uphill climb. There may be one source of financing, however, that will remain plentiful and accessible even in tough times: the business credit card.
Not too long ago, under these circumstances, small business entrepreneurs did bank on business credit cards for their financing needs, according the Small Business Administration’s annual micro-loan study, which tracks trends in loans of less than $100,000. Even during times when traditional commercial lending essentially remain flat, small business loans can grow by as much as 10 percent. This may be an indication of the success of banks’ small business campaigns, offering as a come-on a plethora of small business credit card packages or perhaps even the better methods employed by credit scoring agencies.
Today, a business owner with good standing in personal credit cards will have no problem gaining approval for business credit cards. Even in those cases where the applicant’s credit history is less than sterling, business credit cards are still easier to obtain than ordinary commercial loans. When commercial loans are simply not available – and those occasions do arise – the remaining fallback may be business credit cards. The business credit card is essentially a guaranteed line of credit, and when banks withdraw their unsecured loan offerings, the small business owner may have no recourse other than securing business credit cards.
Is financing with business credit cards prudent?
It can be the ideal solution during crunch time. Business credit cards give you a 21- to 30-day float on your money. You get a guaranteed loan – albeit at high interest rates. The float you get from a business credit card does come in very handy when payments from clients become overdue, or when your business requires unexpected supplies.
This does not mean that business owners don’t get into trouble with financing via business credit cards. More than a few of them have. You should not forget that while the average business owner does not generally carry large balances on the business credit cards from one month to the next, the temptation to do so is very real and it is there all the time. Most entrepreneurs are very responsible people and are prudent in handling their finances - but when their backs are up against a wall, most of them will do whatever they legally can in order to save their businesses. Racking up the balance on their business credit cards can become one such alluring option.
Barring extreme circumstances, intelligent and discriminate use of business credit cards may actually help save the business money. If you consider the savings programs carried in many business credit cards, it is possible for business credit card users to earn discounts on a lot of services – couriers, car rentals, office supplies, printing, and many others. When you work for yourself, you’re always looking to save the pennies. Business credit cards can help you do just that.
Maximizing Irrigation Efficiency with Hunter XC Controller Timers
Hunter XC Controller Timers offer a blend of versatility and simplicity, making them an ideal choice for residential landscaping needs. These timers provide a range of features designed to optimize watering schedules, comply with local regulations, and save water. With multiple programs, power backup options, and diagnostic tools, Hunter XC Timers ensure that your garden receives the right amount of water at the right time, without the hassle.
Reevaluation of Credit Card Industry Practices Demanded
In light of evolving consumer demands and regulatory scrutiny, the credit card industry is undergoing significant changes. Major credit card issuers are revising their billing methods and fee structures to create a more transparent and fair environment for consumers. This article delves into the recent shifts in the industry, the implications for cardholders, and the broader context of credit card practices.
Navigating Credit Card Transaction Disputes: A Comprehensive Guide
Credit card disputes can be a daunting aspect of managing your finances, but understanding your rights and the procedures can significantly ease the process. Whether it's a charge for a product you never received, a duplicate transaction, or unauthorized charges due to identity theft, the protections provided under the Fair Credit Billing Act (FCBA) empower consumers to challenge inaccuracies and withhold payments during investigations. This guide delves into the nuances of disputing a credit card transaction, outlines the steps to take, and highlights lesser-known statistics that shed light on the prevalence and resolution of credit card disputes.
