Editorial Policy

Business Credit Cards Still Not Protected

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By Steven Gibbs
March 7, 2010

Since the beginning of the downturn in the economy it seems that business owners have been hit just as hard if not harder than consumers. For many they have not only seen their main form of payment disappear (collapse of Advanta), but they also have had a hard time trying to find a replacement. Just like consumers, they have had their interest rates raised and credit limits lowered without any time to prepare for ways to make up lost revenue.

 

However, when looking at the main difference of what businesses have to look toward moving forward, one would have to know that the recent regulations put on credit card issuers with the implementation of the CARD Act does not protect businesses. Instead businesses are left to the constant changes that plagued consumers throughout 2009 and in the beginning of 2010.

 

When it comes to the importance of credit cards for businesses, it would be very hard to find many that don’t use credit cards as a vital part of everyday business. While there may be a few, credit cards have become a fundamental part mainly because they are used to fund everyday cost, bridge gaps in cash flow, and in many cases they are used to help pay employees. When drastic changes occur to the terms of these cards it could very well essentially play a major part in whether the company succeeds or fails, especially for many of the smaller businesses. For larger companies, while the change in rates or limits may not effect it as much as small business it still creates a potential problem that can become one that is hard to overcome.