As a small business owner, navigating payment options can be tricky. Credit cards may seem like the obvious choice, but the interest charges and potential debt can outweigh the benefits.
Luckily, there are creative alternatives that can help you pay for things with a swipe while keeping your finances in check. By thinking outside the box, you can find the funding your small business needs without getting stuck in a debt cycle. So, let’s dive in and see what creative solutions await!
Debit Card That Doubles As A Credit Card (without the ‘credit’)
Eons ago you could only use a credit card for online purchases and similar. Nowadays you can link your everyday account to a credit card without the line of credit. You’ll get a credit card number that expenses through your bank account. It’s simple and gives you functionality without a financial headache.
It also adds a little extra layer of security, as you won’t be exposing your account to large potential fraud or theft with a credit line. Track your expenses, stay within your budget, and avoid unnecessary debt all in one.
Use An Alternative Like Weel
If you’re looking for a forward-thinking way to manage your small business expenses with your team members, Weel is an alternative payment option worth considering. With loads of bonuses, these virtual credit cards give you built in spending rules, flexibility, seamless integration into accounting software, cloud-based receipt storage and expense coding on the go. And did I mention the built in spending rules 😉
Coming in at $119 per month fee for up to 5 users, Weel lets you easily control spending, then skip the interest charges and pay with ease.
Make Use Of Your Bank Overdraft
Overdrafts can help ease the financial strain of running a business – keeping your cash flow in check without taking on too much risk. You pay back what you can, when you can – as long as the overdraft stays under the approved limit.
With current credit card interest rates edging close to 13% p.a. Interest, a secured business overdraft with 7.36% p.a. Interest is much more palatable. Interest is generally charged on the overdraft balance until it is fully repaid which is where the risk lies so proceed with caution.
All of these options are general in advice only, make sure you check into the best option available to you and your personal and business financial situation, which may not be discussed here.
Plastic Isn’t All That Fantastic
You may have guessed already but I’m not a big fan of credit cards. In my opinion, they make it far too easy to use the money you don’t have. With interest rates being what they are, a few tumbles and you could find yourself in hot water with no reprieve.
While the shiny benefits and rewards offered with credit cards are tempting, nothing beats a debt-free balance sheet. Don’t be afraid to venture beyond the plastic and explore the alternative options available to you – while keeping the reigns on your spending, making *strategic* business decisions when you need to dip into funds you don’t have. Your business and your wallet will thank you.