Wondering how to go about getting a business credit card? Business Owl shows you how in six easy steps…

Hang on…Why will I need a business credit card?

Managed correctly, a business credit card can be a useful way to:

  • Keep personal expenses separate from business expenses
  • Facilitate record-keeping and auditing
  • Build business credit history
  • Lend an air of perceived legitimacy or credibility to your business.

Step One: Find the credit card account that best suits your needs

While you may already have a bundled business bank account, i.e. one with a business credit card built-in, it’s still useful to investigate what business credit card products each of South Africa’s major banks have to offer. Ask yourself these questions:

  • For what credit limit do you qualify?
  • Is the credit card widely accepted?
  • What are the interest rates and bank charges?
  • Are their any particular, or unusual, repayment terms?
  • How many card holders can run off the main credit card account, and are additional cards issued free?
  • What reward schemes are associated with the credit card account?

NOTE: Some banks require you to hold a business cheque account with them to qualify for a business credit card account. Ask if you will receive any benefits – like reduced bank charges – for holding your cheque and credit card business bank accounts at the same bank.

Step Two: Gather your documents together

As when you open a business bank account, when opening a business credit card account, you will need to submit supporting documentation, including:

  • Identity documents of members, partners, shareholders and directors, as well as each cardholder
  • Proof of business address – utility bill not more than three months old
  • If you operate as a CC or (Pty) Ltd – Proof of company registration
  • If you’re a sole proprietor – SARS documentation with your income tax number
  • If you’re VAT registered – your VAT registration certificate

NOTE: Some credit card providers will also request signed and audited financial statements as proof of turnover.

Step Three: Fill in the forms

Fill in a business credit card application form, either at your local bank branch or online, through the bank’s website.

Step Four: Go through the checks

Your business will have to consent to the following checks:

  • Identity checks of shareholders/directors/members
  • Credit record check with the credit bureaux
  • Fraud prevention checks

NOTE: When it comes to credit card accounts for small business owners, many banks assess the individual (i.e. the small business owner), and not the company itself, for viability.

Step Five: Await approval

Once you’ve submitted your application, it can take anywhere from two to ten business days for the bank to assess your application. Qualifying criteria include a favourable credit history, good business track record and proven turnover above a specified amount.

Step Six: Spend wisely!

Finally, securing a business credit card isn’t a cue to indulge in a spending spree. Ensure that you manage your business credit card wisely from Day One – stick to your limits and make timeous payments on your balance.