Small business owners have been noticing that their mail boxes have been kind of stuffed lately. They've been receiving more offers from marketers of small business bank cards than ever before. In fact, you could say that they have been positively swamped with offers; as each card issuer tries to outdo the others with perks, bonuses, rewards and discounts sometimes too much for anyone to evaluate properly. Smart businessmen though, don't right away decide that it's time for more small business credit cards in their lives just because the rewards are great.
When the credit card reform law went live last year, it only helped the individual bank card holder. It did nothing for holders of small business credit cards. When dealing with small businesses, the credit card companies can still raise their interest rates whenever they want with no notice. They do everything to the small businessman to put one over them that they always did to the individual bank card holder.
The fact that the bank card companies feel tied down in their attempts to profiteer in the consumer side of their business, makes them extra eager to pull the wool over the small businessman's eyes. See now, there is a reason why the bank card companies seem to be falling over themselves to sell to the small businessman - there are no rules or laws around that tell them that they have to behave and be fair when it comes to business credit cards. And are they ever taking advantage of the situation.
Ever since the consumer bank card laws went into effect a year ago and made it difficult for the credit card companies to jack their interest rates up willy-nilly, they've come down on small business credit cards with a vengeance. Interest rates have gone up to 30% in this time. Not only that, they arrange things so that you actually end up paying a couple of percentage points more than what they advertise. It's all in the fine print (they assume you won?? take time off from your business to pore over it).
But certainly, all those generous offers to do with special discounts, cashback and reward miles should be worth something, shouldn't they? Well, the bank card companies make all these rewards sound much better than they really are. And often, the small businessman just buys into all the hype. Usually, they charge you so much an interest and fees that the rewards don't offset anything more than a fraction of what you lose in the first place.
Small business credit cards could be of some use to those who deal with their monthly balances with an iron hand. Businesses are able to use their bank cards to build a line of credit and for this reason, they are useful. But you mustn't really be swayed by the rewards. Usually, bank card companies offer better rewards to the private customer.
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