Secured Business Credit Cards To Rebuild Credit

in Credit Cards

The purchasing power of consumers has been highly increased by credit cards. It seems like buying is so easy. You just swipe your little gold card and the item is yours. But getting a credit card nowadays can be quite a bit more complicated if you have a bad credit score from previous transactions.

One thing small businesses can do if they have a bad credit score is to start again by applying for secured business credit cards. Using such cards can give the new start a small business needs to be a big competitor again in the market.

When you apply for this type of card, you have to deposit a certain amount of money as collateral. That makes a secured card somewhat like a debit card. The deposit you make is lessened every time you make a transaction. It is basically like paying for things with cash except instead you are using your secured business credit cards. The credit limit can be the amount that you have deposited or it can be just a small percentage of that whole sum. This all depends on the credit card company’s policies.

In applying for this, there are application fees, higher interest rates and annual fees – much higher than that of unsecured cards. Though such fees may be a little higher, there are a lot of benefits when using secured business credit cards. This type of card has many of the same benefits as the usual unsecured cards. Your business may be protected from unauthorized transactions and theft and you may get overdraft protection and damage coverage, etc.

There are a lot of banks that offer secured business credit cards, especially to those who want to build up a good credit rating. Secured business credit cards can help you rebuild credit and they can be a good way to start again even without a clean history.

Using this card is like training yourself to be disciplined in using credit. All you need to do is use your secured business credit cards and make your payments on time. Paying your payments in full before the deadline will also help you build a good credit history, thus rebuilding your good credit score. You can show the companies that you are able to make payments on time and pay your bill in full, not just the minimum.

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