A steady cash flow is crucial to keep any start-up's engines running. Even if the idea behind the start-up is one in a million, it will however require millions soon enough to stay afloat. SMEs and start-ups do not get loans from banks easily because of reasons like new to credit, no collateral to bet upon, lack of sufficient funds to show in their account and so much more. Using a personal credit card might help run the show but it is not a permanent solution because it exposes your personal belongings. It is highly unadvisable to mix your personal finances with your business finances because of legal risks. Because of these hosts of reasons, SMEs and start-ups are increasingly moving towards corporate cards- a new way to manage business finances without worrying about credit score or personal liability.
Corporate cards can be incorporated into your spends strategy at the incubation stage itself because the earlier you add them to your financial toolkit the better rewards you can earn over a period of time and the better your credit score for future loan purposes. It is a flexible way of paying your accounts payable and earn perks- it's truly the best of both worlds! Let's take a look at the benefits of corporate cards and how they can help in boosting cash flow.
One of the beauties of a corporate card is that you can make purchases till you exhaust your limit and once you pay off the card bill, you can start purchasing again. It also offers time to pay off your bills. Some cards offer a credit period of as long as 90 days to pay the bill. This helps in moving funds around accordingly so that your cash flow remains steady. Corporate cards like those from EnKash come with flexible billing cycles so you can pick a cycle that best suits your business finances. On top of that enjoy an interest-free credit period and that just is a cherry on the cake.
Corporate cards are the best way to build a respectable credit score for your start-up by simply paying your bills on time. Depending on your spending habits and bill payments, you can build a strong credit score. This can help you in the future if you need to take a business loan from banks.
Corporate cards can act as a brilliant safety net in dire times. Cash flow in a start-up is never steady because of inconsistent revenue and unexpected purchases. You can't always dip into your personal savings to keep your start-up from sinking. This is where corporate cards enter the picture. You can pay off any immediate bills from your corporate cards and get a grace period of as long as 45 days to collect pending payments to pay off the bill.
One of the best reasons to hop onto the corporate card bandwagon is the rewards and perks attached with it. EnKash corporate cards offer amazing business-related rewards which can be redeemed at a huge network of merchants which offer services that can help your business climb the charts. Such kickbacks are always welcome, especially for SMEs and start-ups because they could hardly invest in costly SaaS and software but with the help of such targeted rewards, you can at least start to think about it.
With a corporate card, you can make automated payments your best friend. If you have a fixed payment cycle for payroll and vendor payments, you can simply put it on auto-pilot and rest assured that your vendors and employees will get paid on time. With automated payments, you can also avail of early payment discounts on your vendor bills. Automation in payables helps in achieving transactional efficiency and reduces manual labour so that each employee can focus on more revenue-generating tasks.
Corporate cards also bring with them a whole lot of transparency and visibility. You can track payments as they happen and where they happen. This level of visibility in the corporate spends structure can allow you to make informed decisions regarding the impending purchases and payments in a way that does not drastically affect your cash flow and bottom line.
It is vital to separate your business spends from your personal spends so that if your business is ever under scrutiny for any legal reasons, your personal assets stay safe. It is also helpful during the tax payments season if you have a clear record of your business spends which does not include any personal spends.
EnKash is a smart Card & Platform suite that offers more than 10 types of corporate cards that aid you in boosting your business's cash flow. EnKash also offers unique virtual cards that are extremely useful for one-off payments and subscriptions that do not need repayments. It also has APIs and an integrated accounting feature so that you can keep working on your existing software and still enjoy all that EnKash has to offer. Dive into the deep end of automation and enjoy financial freedom like never before with EnKash!