There comes a time for every growing business to explore the option of using a credit card, whether it’s for convenience of transaction, ease of record keeping, or cash flow benefits of deferred payments. If you’re a smaller business owner or sole proprietor, it’s possible to experience these benefits using a personal card on behalf of your business, since it’s easy to keep track. But as the business grows, there are more expenses, employees and eventually it would start to make sense to get a corporate card (or cards) to better manage payments for day to day.
So here are some relevant considerations for you as a business in how to get a business / corporate card.
How do I get a Business / Corporate Credit Card as a SME
What to know before applying
To qualify for a corporate card, the company should have a valid Hong Kong Business registration and have been in operation for a specified period of time and meet the annual revenue requirement.
Some banks might require the applicant to be the owner, partner, shareholder, CEO, managing director or executive of the company. Some other banks' corporate cards are only applicable to existing Private/Enterprise Banking customers. You should make sure you meet the bank's requirements before filling out the application form.
Preparing the Application
The easiest way is to visit the bank that you already have an account with, either personal or business. The reason is that they would know the best about you and therefore would be the most comfortable determining what kind of credit card to issue. To save time and make the application process faster, you can download an application form for a corporate card in advance. Alternatively, you can also apply online by filling out an online application form through the banks' websites.
The documents you need to submit vary among banks and depend on the nature of your company (For example, whether it is a sole proprietorship, partnership or a limited company). The documents that are generally required are:
• Your Business Registration Certificate
• Certificate of Incorporation
• Constitutional Documents
• HKID Card / Passport of the Sole Proprietor / all Partners / the Director(s) who signed on the above
Certification and Declaration and the Authorised Card User(s)
• Bank statements of the Applicant for past 3 months
The Limit of Your Corporate Card
Banks have different requirements, but it usually depends on factors like a company's economic conditions, consumption and payment records. It also depends on if you have assets that can offer as collateral, allowing you a higher limit. This is considered a secured credit line, meaning the risk is secured by your collateral. The banks do offer unsecured credit cards but that application process is a bit more stringent.
So you can try to get an unsecured card but its best to have some kind of track record in Hong Kong. And almost 100% sure you will need a Hong Kong residential address.
Most of the time there will be some negotiation on what limit is available to you. It will depend on what you plan on using the card for, and how the bank views the riskiness of you being able to pay on time. So it never hurts to prepare a business plan that is sound during your application process.
In summary, for businesses of a certain size, corporate cards provide a good solution to manage all business expenses. Moreover, for employees, corporate cards make it easy and convenient to pay for travel and entertainment and also gives you five-star treatment during your journeys. Now with platforms like Reap, you can also use them for expenses that typically don’t accept credit cards, and earn more rewards while deferring cash payments for your business.
However, be prepared if certain banks do not approve your application on the first attempt. There may be additional info required, or simply because they don’t know your business well enough. In those scenarios, be prepared to try again. The benefits of having the flexibility of a corporate credit card will eventually benefit your business. If all else fails, Reap may be able to offer you an exclusive credit card that will be coming in the near future…
Click here if you want to know about the top 6 ways credit card spending can reduce overall expenses