3 Reasons Why It Pays to Settle Supplier Invoices by Credit Card

James Thorpe
February 28, 2024

Harnessing the Strength of Credit: 3 Reasons Why It Pays to Settle Supplier Invoices by Credit Card

Success and growth in today's challenging business environment hinges on the ability to handle cashflow with precision and efficiency. One tool that is invaluable in helping put your finances in good health is the corporate credit card. 

Of course, there are potential rewards - think points or air miles - for using your credit card, but here are three other reasons why settling supplier invoices with a credit card can give your business a boost. 

1. Immediate Availability of Interest-Free Funds

The most significant perk of using corporate credit cards is the instant access to capital without any interest. At Bluechain, we’re always amazed by how many businesses we speak to whose finance teams aren’t leveraging this!

Most leading card providers extend an interest-free grace period of up to 55 days. This valuable provision enables businesses to meet short-term financial needs without the pain, time and effort that’s involved when pursuing more traditional lending solutions.

Given the current financial landscape where the average bank loan interest rates have jumped to over 5%, credit cards present a cost-effective alternative for managing short-term financial needs. Essentially, corporate credit cards can outperform bank loans thanks to their interest-free grace period. 

2. More Easily Available Solution

Getting support from banks and lenders, especially for smaller businesses, is often onerous and sometimes impossible. Equally, other financing options like supply chain financing and invoice discounting demand a solid corporate credit score. For supply chain financing, the buyer's credit score needs to surpass the supplier's, restricting the pool of corporations that can apply for these loans.

Invoice discounting and factoring can offer a fast solution for businesses with less than perfect credit, but they carry substantial risks like late fees and potential harm to client relationships.

Obtaining a corporate credit card with an extended credit limit can be much simpler and quicker. And with Bluechain, you can now pay any supplier invoice with a credit card, even if they don’t actually accept credit card payments.  

3. Build a Positive Credit History to Access Credit

Corporate credit cards also play a crucial role in gaining a favourable credit rating, primarily by building a robust credit history.

The more your business regularly uses and settles your credit card balances, you actively build a positive credit report and a reliable track record of financial responsibility.

That’s a positive signal to lenders / credit agencies to then entrust your business with credit if you require it.

So, if you're looking to get longer no-interest payment terms, avoid the restrictions of traditional financing methods, and boost your business’ chance of accessing credit,  it's time to think about paying with a credit card on Bluechain.

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