A corporate credit card is a must for any small business.
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But when it comes to selecting a credit card, the choices can seem overwhelming.
Although American Express cards seem to be a popular option for many companies, you've heard some things that make you uncomfortable. So what's the real deal with AmEx business cards?
American Express continues to run in an elite pack of credit card leaders including Master Card and Visa.
Even though American Express business credit cards have some unique characteristics, they currently offer a wide range of products, many of which are very similar to their competitors' offerings. If you are serious about securing an American Express account for your business, here are the product lines that are available to you.
Cards with No Pre-Set Spending Limit
For many small businesses, a credit card with no pre-set spending limit is a match made in heaven.
In a heavy spending period, it's assuring to know that you don't have to worry about maxing out your small business credit card midway through a business trip. American Express understands the value of eliminating spending limits and is more than happy to offer products to meet your needs.
However, there is a trade-off involved with small business credit cards that have no set spending limit. The catch is that the card's balance must be paid off at the end of each month.
If that's not a problem for you, then you should seriously consider either the Business Platinum or Business Gold Rewards card. Since the balance is paid off monthly, there are no finance charges. Instead, there are annual fees ranging from $45 to $395 per year. In exchange, you can earn points toward purchases (Business Gold Rewards) or receive complimentary services like access to airport clubs (Business Platinum).
Cards That Can Be Paid in Full or Over Time
If paying off the entire balance at the end of the month is not your idea of fun, you could always consider AmEx products that can either be paid in full or paid over time. American Express has several products in this category, the difference being the kinds of rewards you can earn with each card.
Unlike the pre-set spending limit cards, most of these products don't have an annual fee. Instead, AmEx is planning on taking your money through finance charges that accrue if you choose not to pay off the balance each month. It's possible to obtain an American Express business card with 0% APR for the first year, but make sure you pay attention to the rate you will be charged after the introductory period expires.
The big benefit of an American Express business card is the ability to avoid finance charges by diligently paying off the balance each month. If you can't reasonably expect to accomplish this, you should consider shopping around for other cards.
You should also be aware that although American Express is a popular credit card provider, their products are not as widely accepted as MasterCard and Visa. Even if you decide that an American Express product is right for your business, you may also want to carry a MasterCard or Visa for vendors and service providers who don't accept American Express.