This COVID-19 business credit card guide provides you with practices that can support your business during a national crisis, including tips for using your cards, getting financial relief from your issuer, and protecting your credit. While business credit cards give you access to financing, you should still be conservative with your spending when revenue is down. If you already have a handful of debt, some issuers may let you temporarily defer your payments.
3 Tips for Using Business Credit Cards During COVID-19
Following business credit card tips can help you use your credit cards efficiently during the coronavirus pandemic. Even if you don’t have one of the best small business credit cards, getting help from your card provider can relieve the burden of doing business during these unprecedented times. These financial best practices can also help you safeguard your credit while getting the help you need.
1. Access Available Business Card Resources
One of the best business credit card tips for the COVID-19 pandemic is to make good use of your credit card rewards. If you’ve been saving up points, miles, and cash back rewards, now’s a good time to cash them in. You can redeem rewards for gift cards and discounted services to ease the blow of unexpected expenses.
Some cardholders also report that their premium card’s concierge service helped them find high-demand items by contacting local stores to verify if the items are in stock. This free service is an added perk on many premium business cards, including American Express, Chase, and Visa Signature credit cards. However, while not all concierge services may be able to help, it’s worth it to contact them anyway.
Owners with premium American Express business charge cards who need more leeway can use the American Express Pay Over Time feature. While you would normally pay your entire bill each month with a charge card, this program lets you pay your balance over time with interest.
2. Be Conservative With Your Spending
It can be easy to feel the pressure to take out more cash during an emergency, but don’t be too eager to spend in a crisis. Normally, using your business card in place of cash is a good option, giving you extra time to pay off balances later. However, it could take your business more time than you anticipated to recover from the pandemic. Inflating your card balances will only leave you with more interest to pay later.
The last thing you need is an enormous bill that you can’t pay on time. So, it’s best to weigh the pros and cons of using business credit cards during COVID-19, even when you’re in a bind. Cash advances can be tempting, but they come with large fees and finance charges. The better option is to make purchases that you can pay off easily under the much lower purchase annual percentage rate (APR) so that you can manage the monthly payments.
3. Use an Available Introductory 0% APR Offer
If you plan on getting a business credit card to cover additional COVID-19-related expenses, you should consider a 0% APR business credit card with a lengthy introductory offer. These introductory periods typically allow you to make much-needed purchases with no interest. If you have debt on high-interest credit cards, you can also use a 0% APR balance transfer offer to pay them off.
The longer the 0% APR period, the more time you have to pay down your balance. The U.S. Bank Business Platinum Card offers the longest no-interest financing period for a business credit card, which makes it a good option for owners who need to carry a balance longer than expected. After you pay off the balance, you’ll still have an ongoing APR that’s low enough to keep your financing costs manageable.
COVID-19 Business Credit Card Relief From Issuers
A national crisis doesn’t happen too often but, when it does, unexpected financial obligations may come with it. Many issuers provide financial relief by offering to waive fees, refund interest, and defer payments. The type of assistance you can receive depends on the credit card provider and your financial situation. Review the main business credit card providers to understand what they have committed to offering business owners in need.
U.S. Bank offers general information on its COVID-19 support page, listing its relevant products, government resources, and mobile and online banking options. U.S. Bank encourages cardholders to contact customer support regarding additional assistance. However, it has limited employee hours, which may impact customer service wait times.
American Express is offering consumer and business support via its customer service and coronavirus support page. Business owners potentially can receive financial hardship relief in the form of lower monthly payments, waived fees, and temporarily reduced interest rates. This provider is also extending the eligible period to earn introductory bonuses an additional three months for new credit card accounts approved from December 1, 2019, through May 31, 2020.
American Express will also help you change travel plans booked through American Express Travel. In addition, it’s waiving travel fees on flight modifications through May 31, 2020. American Express still offers travel and cancellation insurance but has limited some of its other travel benefits, including Centurion® Lounges locations, which have been closed since March 21, 2020.
Chase Bank offers resources for business cardholders on its COVID-19 credit card relief page. Chase offers business owners the ability to delay up to three payments on their Chase business credit cards. However, you’ll need to notify Chase that you are experiencing financial stress to receive payment deferrals. Chase is experiencing longer customer service wait times, so owners are encouraged to enroll online to request payment assistance.
Bank of America
Bank of America is offering help to consumers and small businesses on a case-by-case basis. While some banks don’t mention specifically what they will do to help, Bank of America makes a commitment to defer payments and refund select fees. Business owners can visit Bank of America’s client assistance program page to apply for a business credit card payment deferral.
Capital One has a COVID-19 support page that doesn’t commit to helping customers in specific ways. However, many customers report receiving assistance in the form of deferred payments and waived fees upon request. Business cardholders can contact customer support regarding financial hardship requests. However, Capital One is experiencing longer hold times because of the pandemic. Cardholders are asked to use mobile and online banking as much as possible.
Wells Fargo is offering additional assistance through its COVID-19 resource page for cardholders affected by the pandemic, including business payment deferrals and fee waivers. However, Wells Fargo determines appropriate assistance on an individual basis. Contact Wells Fargo by using the number on the back of your card to request financial assistance. Customer service hold times may be longer than usual due to reduced banking hours.
Discover doesn’t specifically state what type of assistance it will offer customers on its COVID-19 support page. However, cardholders are encouraged to contact Discover directly for information on how to get assistance when you need it.
Citi has expanded its COVID-19 support for business owners affected by the coronavirus crisis. Citi is offering minimum payment deferrals of up to two months, collection forbearance programs, and late fee waivers. Unless your business credit card was already in default or late status, Citi will not report late payments while under relief status.
Citi customer service call times have also been affected. Citi encourages cardholders to request assistance online or on the mobile app. You can also text “App” to 692-484, and Citi will send you a link that will direct you to its messaging service via the mobile app.
Barclays offers payment relief services for consumer credit cards online but doesn’t address financial assistance specifically for business credit cardholders. However, all customers who need assistance are encouraged to contact Barclays directly online or through the mobile app. Barclays customer service is available 24 hours every day for business cardholders.
Protecting Your Credit During the COVID-19 Crisis
There’s a lot to consider when navigating a national emergency as a business owner, such as protecting your credit. While you are confronted with unexpected challenges, you can do a few things to make sure your credit will remain in good standing once COVID-19 crisis has passed.
1. Adjust Your Monthly Budget
Even if your expenses haven’t increased because of the COVID-19 pandemic, it’s still a good idea to reduce your monthly expenses wherever you can. This can help you avoid missing payments that can negatively affect your credit report. When revenue is down, adjusting your budget will help you keep up with your monthly obligations.
2. Contact Vendors and Providers
You’re committed to keeping your business as strong as you can in changing times, so you may need to reach out for additional assistance. Your vendors and card issuers may adjust your obligations in a way that can relieve some of the pressure. Many credit card providers have contingencies in place for the COVID-19 crisis, but they won’t extend these services to you unless you request it.
3. Check Your Credit Regularly
Although it’s important to check your credit report at any time, it’s even more crucial during times of emergencies. That’s because many businesses are affected by the COVID-19 pandemic, and mistakes are more likely to occur with vendors and your credit report. Keeping an eye on your credit report lets you know when there are unforeseen changes to your credit profile.
4. Identify and Avoid Scams
Unfortunately, national emergencies are prime for scammers, and there has been a rise in the number of scams involving business email impersonations. There are also reports of phony emails and text messages that appear to be from the World Health Organization (WHO). These phishing emails seek to collect personal information about you and your business. Always review the email addresses you receive, and if anything is strange, don’t respond.
You should also be on the lookout for suspicious emails that appear to be from business associates requesting a phone call, text message, or other information. Business owners should pay particular attention to online merchants selling hard-to-find items that aren’t available—taking your payment and never sending the goods. If you’ve been a victim of a scam, report the activity to your credit card provider, and the online retailer involved immediately.
5. Remove Incorrect Information From Your Credit Report
Negative items on your credit report can lower your credit score and impact your current and future accounts. If information isn’t correct, you can submit a dispute with your issuer and the specific credit bureau. If you are checking your credit report frequently, you’ll be able to catch invalid items on your report before it does too much damage. Report all errors that appear on your credit report as soon as you discover them to avoid further impact to your credit.
Other COVID-19 Financial Relief Resources
We understand that the COVID-19 pandemic can impact your business in more ways than one. Business credit cards are just one helpful tool businesses can use to help fund unexpected costs. There are additional resources available through the COVID-19 stimulus package and the Paycheck Protection Program that may provide even more financial relief if you’re eligible.
During the COVID-19 pandemic, it’s crucial to keep your spending to a minimum, only making purchases that will help your business survive the crisis. If you need extra time to pay down your credit card bill, consider applying for a card that offers an introductory 0% APR or turn to your issuer for temporary financial relief. Most issuers have relief programs in place that help waive fees, refund interest, and defer payments.