Many small business owners in Maryland and elsewhere have applied for business-related credit accounts for financial assistance. A small business credit card could prove useful under a variety of circumstances, and such accounts may even offer a variety of perks and rewards. However, owners might find it advisable to use caution with these accounts, as falling behind on payments could lead to financial challenges and a subsequent need for reorganization.
Whether for financial assistance in starting a new company, or for use in day-to-day operations, many owners carry business credit cards. While interest rates and reward programs on similar accounts may differ from a personal credit card, the result of falling behind on payments could be equally as devastating. Much like any other line of credit, owners may find that keeping current on payments is advisable, but in periods where profits decline, this goal could prove challenging.
In some cases, an owner may also allow employees to use business credit accounts on behalf of the company. While it may be necessary to authorize certain individuals to use these cards, setting clear rules on the types and amounts of purchases that are acceptable could help prevent a disaster. Substantial amounts of debt can have a substantial impact on the growth of a company, and for those who experience similar issues, seeking guidance could prove vital.
Business owners who experience the trials of dealing with overwhelming amounts of credit card debt may wish to reduce or eliminate these issues. With the potential weight debt can have on a company, an owner may find it beneficial to consult with an attorney for information on the available options for relief, such as reorganization. A bankruptcy attorney can assist a client in Maryland in making informed decisions regarding the financial future of his or her company.
Source: nav.com, “Don’t Let Your Credit Card Sabotage Your Business”, Jason Steele, Feb. 26, 2018