The role of credit in handling business emergencies

 

The pandemic has struck small business owners hard, and many of you are running through your savings like a knife through butter. The job situation is not too good, as the unemployment numbers are extraordinarily high! Therefore, as a business, you will have to rally your own resources and find a way to survive. The question you should ask yourself is: Could you have done better preparing for such a situation? It is always good to analyze and self-correct, and that is what we are asking you to do here.

One of the ways to combat monetary issues is through liquidity. That is what a credit facility it from a bank offers you. The advantage of this facility is that you only utilize it when you need it. You only pay interest on the amount used. Also, you can get benefits such as cashback and travelers miles if you use a credit card. Smart use can allow you to take vacations with family, using these miles. So, you really need to pay all your firm's expenses through such a facility to give the highest possible benefit to your business. There is a process to acquire such a facility, and we will elaborate on the same.

At wholesale shelf corporations, we offer financial consulting services with a focus on unsecured lending. In the post, we will show you how a credit limit can and does help you in difficult times. Suppose you haven't got one for your business. In that case, you should immediately start working on applying for an unsecured business credit card.

Acquiring a corporate credit card

The first thing you need to do to obtain a credit card is to examine your credit history. If there are any issues, such as outstanding or late payments, you need to sort them out. You can check these through your personal report issued by either TransUnion, Equifax, or Experian. These agencies must provide this report to you for free if you demand it. Once you have it in your hands, analyze it carefully, check for issues. Clear the outstanding amount and get a no-dues certificate from your lender. It will take some time to get reflected on your report, and your score will improve.

The other thing that you need to keep in mind is the payment track record of your business. You must ensure that all payments are made before the agreed time, as not doing so impacts the Paydex score of your business. This is a metric issued to every firm by Dun & Bradstreet. If you have both of these issues under control, then apply for an unsecured credit card from your bank. If there are issues with the Paydex score, you can think of buying shelf corporations, and shifting your transactions to that firm. The advantage of these companies is that they can enable you to get approved for financing much faster than if you were to rectify your shortcomings in the existing firm.