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Update: Some offers mentioned below are no longer available. View the current offers here – CitiBusiness / AAdvantage Platinum Select World Mastercard
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There’s much to love about paying for business expenses with a credit card. It makes meeting minimum spending requirements on welcome bonuses that much easier to reach, you can swiftly rack up credit card rewards and you can take advantage of financing offers that give you more time to pay without incurring interest charges.
Putting as much as possible on plastic also is a way to keep expenses organized, although traditionally there have been some limitations to this because few landlords or banks allow you to pay your mortgage or rent with a credit card.
That’s where a service like Plastiq can help small business owners. The bill payment service allows you to use a credit card to pay for practically any expense. For that service, you’ll be charged a 2.5% fee, although in the case of Plastiq, the company says some business owners are able to write off a portion of the fee on their taxes. Still, the fee wipes out any meaningful rewards you would earn on the transaction, but it may be worth it if you’re trying to quickly reach a minimum spend requirement.
Here are five reasons to put everything — including commercial office space rent and vendor invoices — on a business credit card.
1. You’ll Better Manage the Company’s Cash Flow
When paying with cash, that money immediately leaves the company’s bank account. By paying with a credit card, it extends the time a small business has to pay its bills on its accounts into the next billing cycle. You might be able to extend that period out further depending on the business credit card you hold. This can be especially helpful with your largest monthly expenses, like rent and vehicle leases.
The Plum Card® from American Express, for instance, gives cardholders 60 days to pay off a balance before accruing interest, while other cards, like the Ink Business Cash Credit Card, offer lengthly 0% interest introductory offers. Ink Business Cash comes with a comes with 12-month interest-free intro offer on purchases and balance transfers for 12 months. (After that, it will be 15.24% to 21.24% variable APR)
2. It May Make Your Budgeted Expenses Cheaper
Small businesses know they will have recurring expenses every month — from company insurance and rent to vendors and suppliers. You may be able to reap the benefits of early-pay discounts on some of these expenses by charging them to a credit card. This may not otherwise be an option for you if you have to rely on the money in your business bank account to pay bills early.
3. Enjoy Additional Credit Card Benefits
Increasing spend on your business credit card may make you eligible for higher lines of credit, higher status tiers and invite-only elite card products. The CitiBusiness AAdvantage Platinum Select World Mastercard, for example, offers a $99 annual companion certificate for domestic economy travel if you spend $30,000 in a cardmembership year and if the account remains open 45 days after the anniversary date. And you can lock in elite status on Delta with the Platinum Delta SkyMiles® Business Credit Card from American Express; earn 10,000 MQMs and 10,000 redeemable miles if you spend $25,000 on the card in a calendar year (and another 10,000 of each if you spend $50,000).
4. Establish a Business Credit History
If your small business is new, you probably haven’t yet established any business credit, which is separate from your personal credit score. This can make getting a small business loan or a line of credit difficult. Opening up a business credit card and paying off expenses in full each month can help a small business establish and build up a credit score. After you open that card, issuers will report your payment track record to the credit bureaus that monitor business credit. Paying on time will make it easier to get favorable lending terms in the future.
5. Streamline Your Expenses
When a small business puts all of its expenses on a credit card (or two or three), it makes it easier to keep track of where the money is going. This, along with credit card expense management tools, is a great way to streamline your payment record keeping. Use this strategy in combination with a card like The Business Platinum® Card from American Express, which offers Spend Manager, a feature that allows you to add receipts and notes to your transactions either via desktop or your mobile device. It also comes with Connect to QuickBooks, which automatically sends card transactions to your QuickBooks Banking page every day.
Paying for business expenses on a business credit card can be a great boon for an entrepreneur. Not only does it help small business owners stay organized, provide extra float time between payments and establish the company’s credit score, but it can also earn the company credit card perks they might not otherwise have been able to reach with normal credit card spend. If you’re interested in trying out a bill payment service, you can sign up for a free account at Plastiq.com.
The American Express Platinum card has some of the best perks out there: cardholders enjoy the best domestic lounge access (Delta SkyClubs, Centurion Lounges, and Priority Pass), a $200 annual airline fee credit as well as up to $200 in Uber credits, and mid-tier elite status at SPG, Marriott, and Hilton. Combined with the 60,000 point welcome offer -- worth $1,140 based on TPG's valuations -- this card is a no-brainer for frequent travelers. Here are 5 reasons you should consider this card, as well as how you can figure out if the $550 annual fee makes sense for you.
- Earn 60,000 Membership Rewards® points after you use your new Card to make $5,000 in purchases in your first 3 months.
- Enjoy Uber VIP status and free rides in the U.S. up to $15 each month, plus a bonus $20 in December. That can be up to $200 in annual Uber savings.
- 5X Membership Rewards® points on flights booked directly with airlines or with American Express Travel.
- 5X Membership Rewards points on prepaid hotels booked on amextravel.com.
- Enjoy access to the Global Lounge Collection, the only credit card airport lounge access program that includes proprietary lounge locations around the world.
- Receive complimentary benefits with an average total value of $550 with Fine Hotels & Resorts. Learn More.
- $200 Airline Fee Credit, up to $200 per calendar year in baggage fees and more at one qualifying airline.
- Get up to $100 in statement credits annually for purchases at Saks Fifth Avenue on your Platinum Card®. Enrollment required.
- $550 annual fee.
- Terms Apply.
- See Rates & Fees