Like many individuals, businesses sometimes find themselves having difficulty managing their credit cards. When revenue decreases, the ability to keep up with business credit card payments is lessened. During difficult economic times, some businesses attempt to rethink the way they use their credit cards, and preserve their good credit while the economy improves. There are many different approaches to getting help with your business credit card payments.
Your first task in getting help with these payments is to call in a financial expert. In order to develop a workable strategy for managing the cards, you need someone who can assess your overall fiscal condition and assist you in understanding which options you realistically have. Only after this assessment of the company’s overall economic condition takes place can you truly devise a workable process for dealing with your business credit card payments.
Assuming that the revenue generated is enough to maintain minimum payments on your business credit card payments, it would be a good idea to discontinue use of as many of the cards as possible. Pay at least the minimum amount each month, and a little more if possible. The combination of timely payments and the lack of new activity will lower your overall debt and make it easier to readjust your expenses to match your income.
At the same time, identify one of your cards to pay off as soon as possible. While continuing to make minimum payments on the rest, pay as much as you can on the one card. You may choose which card to pay off based on the outstanding balance or the rate of interest applied to the balance each month. As soon as you retire the debt on one card, move on to the next. This creates a resource you can use in an emergency, since the card is still good and your credit is intact.
If your revenue has dropped off to the point that you can no longer manage minimum payments, it is imperative that you proactively contact the card issuer and work out some sort of repayment plan. Do this before you get behind in your business credit card payments. Assuming that you’ve made timely payments in the past, there is a good chance that the card issuer will be willing to work out a repayment plan that will allow you to retire the balance without accruing additional interest. Often, you will agree to not use the account for new purchases until the account is paid in full. At that point, both you and the card issuer can reevaluate the company’s financial situation and adjust the credit limit if necessary.
Even companies that appear to be on sound fiscal footing can go through a period of financial reversal. However, by taking aggressive actions to adjust spending and retire outstanding debt, it is possible to manage the business credit card payments and keep the company’s credit rating intact. In the end, the company will be stronger and in a better position to deal with adverse economic conditions.
