New rules for small-business credit cards

Contrary to what many entrepreneurs believe, the Credit Card Responsibility, Accountability and Disclosure Act, or Credit CARD Act, applies only to consumer cards -- not small-business credit cards. The act, signed into law in 2009, drastically changes how credit card companies do business with consumers. It limits what credit card issuers can charge for late fees; sets guidelines on how much notice lenders must give cardholders about changes to their terms; and forces lenders to apply payments to higher interest balances first, among other changes.

The law has cost the credit card industry billions of dollars in revenue. Increasingly, lenders have turned to more lightly regulated small-business credit cards to make up the difference. Since two-thirds of small businesses use credit cards, it's important for small-business owners to weigh their options when selecting a credit card for business use.

Best options for business cards

When using a credit card calculator online, be sure to look for a low-fee or no-fee card. If you have an established business with a good credit history, you may also be eligible for a rewards card that can offer your business bonuses, such as cash back or travel miles. If you do your own accounting, you might want to look specifically for a card that categorizes expenses and provides an end-of-year expense report.

Read the reviews online

When comparing credit cards online, look at reviews other entrepreneurs have written about credit cards that they've used. By looking at the dates of the reviews, you will be able to tell if a company's policies toward small-business credit cards have changed since the CARD Act became law.

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