April 15, 2022

How To Use Credit Card Facility To Grow Small Start-Ups?

By Sona Mathews

What's the one thing your small business needs right now? Money! What's the one thing that's becoming hard to put your hands onto?

Also, money!

When your business is in the early stages, managing finances is the key to success.

However, start-up owners find it difficult to deal with all the expenses while maintaining their business money bank in Canada or other countries.

How To Use Credit Card Facility To Grow Small Start-Ups?: eAskme
How To Use Credit Card Facility To Grow Small Start-Ups?: eAskme

But what they might not know or forget due to stress, having a good credit score in Canada or their respective areas can help them balance their business finances while looking forward to getting more capital earnings.

Yes, if you get a rewarding business credit card, you can easily sort out many things like:

●     Business finance account
●     Loan payments
●     Office running bills
●     Employee wages

You can also find a way to get endless discounts and offers to grow your business.

Don't know how? Keep reading the guide to find the answers!

Purpose Of Credit Card For Your Business:

Money is not always the answer, but sometimes, at least for your business, it can solve many problems. For example, it can help your small company thrive and strive in changing market conditions.

And, if you don't want to be an unknown business all your life, you need good business marketing strategies, a stream of finances to manage employees, running costs, investments, loans, and all that hectic stuff.

Here comes the purpose of a credit card for your business in the picture! But before, let's read some reasons why your business might need it:

  • Managing finances for your business can become complicated quickly if you're a sole owner or have multiple (still a small ratio) partners.
  • The chances of financial and power betrayal increase as there's no set system to maintain finances in the company.
  • Your business can lose the advantage of getting investments, supplies, and customers.

According to CRA, the worst is the late tax penalties and interest for your business due to improper financial management.

If you fail to deal with those, it can eventually become the reason for shutting down your company.

How To Use Credit Card For Your Business?

Credit card financing appeals to new start-ups and middle-sized business companies with limited funding availability.

A growing business owner might prefer credit cards to open the closed doors of investments.

Or even use the card advantages later in their business to deal with running costs.

Credit card financing can be a suitable type of financing for your business if:

  • Your business credit card has a high credit limit
  • Your business credit card has a low-interest rate
  • You get rewarded every time you use your credit card for business purposes

Indeed, you can achieve many good things for your business using a credit card. So, how to use it to the best? Let's find out!

Set Credit LimitsBusiness credit cards to come with endless benefits.

But, they can have quite some pitfalls too if not used properly. So, the first thing you must do is set a credit limit for all your employees.

As per Brex's research, not every employee needs to use a full high credit limit for their daily business expenses.

You can also restrict the credit use authority to certain employees.

  • Credit misuse: Employees might abuse credit usage, resulting in missed payments and unauthorized expenses.
  • Financial mix-up: They might also wrongly mix professional and personal expenses, which can be bad for business finance

It's wise to benefit from corporate limits and take measures to adopt the right business credit usage strategies.

However, not all business cards might allow you to limit employee usage, so do your research first about the card and then choose it for your business.

Make Positive Payments:

If you want to grow your small business with credit card financing, you have to make sure you or your employees don't exploit the credit limit or money power.


What does it even mean?

To keep the card in a good range, you must maintain your payment history, business credit score, and debt ratio.

Here's what you can do:

  • Prefer paying manageable bills: Use your credit card to pay bills you think you can always pay in full. Yes, you don't want to put tabs on your card that you can't manage.
  • Use automated payments: If you or your employee tend to forget the small bills while dealing with the large expenses, you might need to turn on the automatic deductions.

The key is to manage and maintain your card's payment history without suffering financially or emotionally.

Activate Payment Alerts:

If you want to use the credit card best, you must ensure nobody's misusing the business card.

As a business runs on multiple things, financial planning of owners, the credibility of employees, investments, and so much more.

If multiple employees are responsible for managing the finances, then with so much going on, one can expect a bit of wrongdoing.

  • An employee in the pantry has the authority to use the card on weekends to buy the supply. Imagine them using a small amount of money every week for personal reasons.

Of course, you might think it's fine as long as it's not harming the company's finances?

That might be true for large firms, but every penny counts for small businesses!

So, you should activate the payment alerts even if it was for a dollar.

Understand The Card:

This might seem obvious for the proper credit card usage.

However, we tend to forget the most basic things in good times. But, sadly, those trivial things can become monstrous in the long run.

Therefore, it's critical to understand when a company should use credit. It isn't always the greatest option, particularly for major purchases that can't be paid off in full before interest accrues.

Even when obtaining a loan from a bank or other lending organization requires more effort and technique, it's often financially wise because the interest rate on credit cards is often much higher than for such secured debt strategies.

Use the convenience but don't abuse it!

Yes, a credit card can be beneficial for your business finance management.

However, you shouldn't be misusing the credit to make payments which can put your business into debt because we tend to spend more when we aren't using the cash!

Benefit from the process but don't forget your growth!

A business credit card can be easy to get approved for if you don't have a solid credit history.

However, you shouldn't be careless in using it instead of focusing on building your business credit score.

Invest credit in your business!

Approvals are often easier when you possess assets and have collateral that lenders may utilize to obtain a loan.

Owning your equipment can help you improve your credit score and raise your chances of getting finance from a wider choice of lenders, such as asset-based lenders.

Know The Welcome Rates:

As we said earlier, it's intelligent for a small business owner to know what options he has to grow his business.

That also includes choosing the right business credit card. BDC explains that you have to do your complete research to use the financial opportunities to improve your business financing.

And introductory rates or welcome bonuses are one of the things you can benefit from using a credit card.

  • Some business credit cards offer 0% APR for a year or more, with the other good offers.
  • These business cards work more like a no-interest loan choice for you which you can grab and utilize for the best.
  • You can use the card for large business purchases without thinking about the high rates.

However, don't go overboard and make things difficult for your future when the introductory offer ends. So, it's wise to pay the large loan payments monthly, so there's no penalty afterward.

Things To Keep In Mind While Using Card:

The market is filled with endless business credit cards that offer similar bonuses and rewards if you hit definite spending or earning limit.

How appealing it may sound, but as a start-up, you should be extra careful before buying the card and then using it.

Missed Payments Can Be Costly!

You wanted to grow your business using the business card rewards for discounts and bonuses.

But, if you fail to manage it properly, all the benefits will be working against you!

  • According to Lendio, a late or missed payment will only make it hard for the business even to continue the regular business
  • Missed payments come with a penalty or interest fees usually higher than average. So, if you failed to make the payment timely, you might have to pay double the original.

So, you must always balance what you owe and what you pay because only then it can work in favor of your business growth.

Track Your Record For A Better Growth!

Sure we said that money is the most crucial thing for a small business.

However, things can go downhill if you have the funding but don't know how to manage it properly.

So pay attention to all your income and spending over the time and note anything that seems out of context.

  • Don't just rely on your gut on this one; be sure you're working with hard numbers and know how your finances have changed over time.
  • Make a budget plan, share it with your employees, and make sure everyone understands the goals you're working for.

There are various modern tracking tools available that can assist you in doing this task quickly and without performing a lot of cognitive work.

Artificial intelligence (AI) applications or tools are particularly valuable since they can assist you in identifying patterns in your outlay and inflow that would otherwise go unnoticed.

As your company grows, this data can assist you in making enlightened decisions.

Overlooked Errors Will Smash Everything Good!

A credit report is your permit to attract investments and outsourcing funding.

But imagine if the lenders analyze your report and find mistakes in it.

What would the impression be about your business?

Yes, they might think of you as irresponsible and not worthy of business.

  • Check your business credit report on Equifax or other official bureaus regularly to make sure it stays error-free
  • Keep a check on the growth of your business credit score as it will help you set terms for your finance deals

Problems with your finances will arise whether you want it or not – and this will happen pretty frequently.

You should get acclimated to this truth and begin preparing to deal with problems as soon as they arise because otherwise, the problems will worsen, and you will feel trapped.

You must stay on top of these problems and handle them as promptly as possible.

Never Stop Looking For More!

Credit card companies are always coming up with new strategies to grab the attention of new customers.

But, most of the time, they are continuously working to maintain their current user ratio.

And to do so, companies offer endless beneficial offers to start-up businesses that can urge them to keep using the business card.

  • Even if you're happy with your present credit card, you should never rule out the possibility that the market will surprise you with better offers.
  • Ask around the market what cards other businesses are using or what has been working in their favor.

This is only one aspect of running a successful business. Keeping up with current market trends is important for your local market and the entire financial world.


Managing the current finances while constantly looking for more funding is a struggle a small business owner has to make continuously.

But, the things don't need to be that hard.

You can enjoy all the perks of a business credit card to ease the tension while looking for more investments.

So, give this guide a read to know how to use your card for business growth!

Still have any question, do share via comments.

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