Prepaid Business Credit Cards: A New Twist on an Old Business

An effective tool to prevent you from spending money you don't have

There was a time when having a prepaid business credit card was an indicator that you had bad credit and using one was the only way you could get one. Fortunately, that's a thing of the past.

A prepaid business credit card has several advantages, primarily among these is to allow a person the convenience of a credit card without going into debt. A prepaid business credit card can be used in many different ways, just like a regular credit card, whether online or in a brick and mortar business.

But since a prepaid business credit card must be loaded with funds before they can be used, there is never a danger of spending more money than you have. These are effective tools that will keep anyone from spending money they don't have, and as a result racking up charges that you will have to end up paying.

More and more, business owners and managers have started to use prepaid business credit cards as a means of controlling expenses for themselves and virtually anyone else who needs money to conduct company business, but need to be "managed" in the process. It's not like you don't trust others, especially your associates and employees, but in many cases, business owners can't trust anyone, and this is one safeguard they have to control expenses.

The Monthly Surprise

If you are the owner or manager of a business, chances are good that in the past you have opened a credit card bill or an employee's expense report, only to find that they have been overly generous with your money to themselves and/or others in the commission of their work.

Some expenses could be considered questionable, and some, downright wrong. Unfortunately, the only alternative is not allowing the expense, which leaves a sour taste in everyone's mouth.

One alternative is the prepaid business credit card. For example, with a prepaid business credit card a salesperson on the road will probably think twice about charging three visits to "Trixie's House of Pleasure" when he still hasn't paid for his hotel and meals yet.

And if this misuse of money shows up on his bill, an owner or manager would have a good reason to call an employee on the carpet for their questionable spending.

Ultimate Control

A prepaid business credit card could be considered a debit card with even more restrictions, which gives owners and managers more control over how much money is spent, where, and when. For example, if you are running a delivery business and you want your drivers to be able to buy gas only, you can set spending limits not to exceed the amount of money it would require to fill the gas tank of your trucks. Further, if all the gas tanks of your trucks were filled on Monday morning, there should be no reason for drivers to fill their tanks again on Monday, making a purchase, even for gas, impossible.

If that's still not enough control for you, why not set a spending limit for each employee by the day, week or month, and different limits set for different days? With a prepaid business credit card, it can be done very easily. Further, when the amount set for the card has been reached or a time limit has been reached, the card can be "reloaded" for another time period or another amount, whichever the case might be.

No-Lose

Most banks partner with the big credit card providers to offer credit cards to their customers, including prepaid business credit cards. The bottom line with prepaid business credit cards is that nobody can lose in these situations since banks receive their money up front, business owners are protected to a great extent, and employees who are charged with making purchases along certain guidelines can do so without hassles.

In the old ways of doing business, trust could be a valuable thing. Unfortunately, we live in a different time and under different conditions, which have shown that more than ever before trust must be earned. Prepaid business credit cards are a way to ensure that trust.