Secured credit cards for business- Some pros and cons


Canada, 21st September: Using a secured credit card instead of a standard credit card for your business has its own set of advantages and disadvantages. Let us read on to know more— 

Canada, 21st September: Using a secured credit card instead of a standard credit card for your business has its own set of advantages and disadvantages. Let us read on to know more—

Since, any new business is likely to face difficulty in obtaining a credit card. Also, a business which does not support good credit history will find it impossible to get a credit card. Hence, the only option in such a case is to go for a secured credit card.

Let us consider some of the pros and cons of having a secured credit card for business—

Advantages——

• The main advantage of any secured credit card is that it provides your business an opportunity to re-establish its credit history once again. Once, the credit history gets rebuild, your business can look forward to getting standard credit cards within a span of about one year, thus giving you the benefit of not requiring your personal credit card for your business.

• Another distinguishing advantage of using a secured credit card is the facility of travel insurance and auto hire insurance. These facilities are extremely beneficial for those who need to go on business tours.

• Some secured credit cards also provide the benefit of warranties on business tools or equipments.

• Secured business credit cards have the facility of providing expense management online which is considered useful for business purposes.

Disadvantages of Secured credit cards for business—–

• The major disadvantage of using a secured credit card for your business is that you will have to deposit an amount equivalent to the extended credit. This will keep the inflow of cash tied up.

• And the fact that you will have to shell out more bucks every year for paying application and annual fees along with a high interest rate.

So, now, you have become aware of various benefits and shortcomings of using a secured credit card for a business which is either new or has a poor credit history.

A good option for a new business is going for a starter business card or the CSI global secured Mastercard.