As a business owner, you make countless purchases every month. Some are small, while others are large; some are one-time purchases, while others are recurring. While you might have access to multiple payment options, you may be wondering which one is most appropriate for your needs.

Convenient payment methods for everyday business purchases

For everyday business purchases — job supplies, office equipment, client lunches, and fuel for your business vehicle — you might consider using a debit or credit card. Here are the advantages:

  • You can easily track transactions with debit and credit cards, and set recurring payments which save time and eliminate missed payments.
  • Your debit and credit cards may provide security benefits that cash does not, such as purchase protections, warranty extensions, and fraud monitoring.
  • A business debit card allows you to use operating funds for your everyday purchases without incurring credit card debt.
  • Using a business credit card can help to build credit. And by paying it off in full each month, you may avoid paying interest.
  • You may be able to take advantage of rewards programs by using a credit card.
  • You can add your card to a digital wallet on your mobile device for added convenience.

Flexible payment methods for larger expenses

Sometimes you'll have larger purchases or business expenses that you want to pay off over time, such as expensive equipment, expanding your business, adding staff, buying inventory, or making building renovations. Often you may need to rely on credit for these expenses. In such instances, you might consider a business loan or line of credit as flexible options:

  • Business lines of credit may be a good option if you need to supplement cash flow to cover gaps in account payables and receivables, seasonal expenses, or to take advantage of business opportunities that arise. With a revolving line of credit, you only use the funds that you need, when you need them. And as you make payments on your account, you have the flexibility to access funds again as needed.
  • Business loans could be a good option to finance fixed assets over a longer time period. With a business loan, you take out a fixed amount of money and pay either a monthly or weekly payment, typically based on a fixed interest rate, over a determined amount of time. At the end of your term, your loan is completely repaid.

By considering these factors, you can make the right decision about which payment method is best for each of your business purchases.

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