Your Small Business: Charge Card vs Credit Card |
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Both a business charge card and a business
credit card could be beneficial to you, depending on your unique
business needs. While these resources are very similar, they have a few
things that make them different. Here are a few things to consider
about charge cards vs credit cards.
Balances
One of the biggest differences between these two types of
cards is in the way that balances are handled. Both of them will give
you a specific credit limit to work with. With a charge card, you can
charge up to your credit limit and then you will have to pay off the
balance by the next month.
With a credit card, you will be able to make purchases up to
your credit limit as well. The key difference with this type of card is
that you can allow your balance to stay on your account for an extended
period of time.
Leaving Balances
If you leave a balance on your credit card, you will simply
start to accrue interest charges on the account. You will then have to
make a minimum monthly payment the next month. With the charge card, if
you do not pay off your balance, they are going to charge you late fees.
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