Should a business rely on credit?

The research, which surveyed more than 700 UK-based small businesses, revealed that 44 per cent use credit cards as working capital. It's important to remember that as long as you keep control of your debt, ensuring you pay off small amounts as and when you can, you won't run into any trouble.

With a spot of online research, you can search out a good deal via price comparison sites. An increasing number of businesses are using their credit cards for business finance; one reason for this is that business credit cards are ideal for invoices and short term finance for products.

In much the same way as personal credit cards, business credit cards often charge a yearly fee. They even give businesses the opportunity to provide employers with their own credit card for travel and expenses, which saves them filling out tedious expenses forms. So, if your employees need to book accommodation, pay for travel or food, a credit card may just come in handy.

Just as the sign-up process for a business credit card is fairly simple, it's also extremely easy to add supplementary card holders to your account. However, do check if your bank charges for this service before you go ahead. You can also track employees' expenditure on business credit cards, which means you can remain completely in control.

Why should you choose one provider over another? Some business credit cards, for instance, offer reward schemes; depending on how much money you or your employees spend on your credit card, you may be entitled to points or rewards.

Ensure you search out credit cards with a good rate, or you may find that you end up paying more than you need to. Credit cards are great for small items and consumables required during the day-to-day running of your business and they can also be used to purchase things online while offering you increased protection. For instance, if something you ordered online doesn't arrive, your purchase is more secure with a credit card.

Computer equipment and that all-important office furniture, such as desks, chairs and even filing cabinets can also be bought on a business credit card, but ensure you have the funds to pay off the card's interest when required.

Interest can build up quickly if you don't keep on top of your repayments, so make sure you manage your finances correctly, which is why shopping around for a deal is important,.

While it's far from the ideal use, some small firms will use business credit cards for working capital finance. Do this and you'll find that interest will build up rapidly and you'll receive higher interest rates on cash withdrawals; not great if your team needs to travel abroad for meetings and they need to withdraw cash on the go.

The great news is that if you decide you want to sign up for a business credit card, the online registration process is extremely simple. Offering a straightforward and flexible way to manage your cash flow, credit cards ensure you can stay in control of business expenses. On top of this, business credit cards could even reduce your charges from the bank.

With flexible repayment options and detailed statements by email or by post, everything is taken care of with a business credit card.

Does your business rely on a credit card? If so, maybe it's time to get a better deal and save yourself and your company money!