Business owners benefit from new travel rewards

by John Qua

for the Business Journal

If you are considering a business credit card account for your company, or thinking of switching to a different card provider, you might want to consider a program that adds even more value to business credit card use.

Today, some business card programs offer reward programs tied to travel-related purchases. The financial benefits of such programs may tip the scales if you allocate any part of your yearly budget to travel expenses.

Travel rewards programs. With a travel rewards program, you earn points for airline tickets charged on your business credit card. The number of points depends on the cost of the tickets.

Some rewards programs limit you to certain airlines, destinations or dates of travel. Some impose blackout dates, advance-purchase requirements or Saturday-night-stay restrictions. Some programs award points for cruise-ticket purchases.

Be sure to choose a card and a rewards program designed specifically for business owners. Some rewards programs are tailored to personal card users and may not provide the features or rewards that a business card would.

Desirable redemption options can include air travel and hotel accommodations, staff training and seminars, and state-of-the-art office equipment such as cordless phones and computers.

Business credit cards provide valuable financial rewards for you as the employer in that all points accrue to you as the account holder, rather than to employees who use the individual cards. However, as a way to provide incentives to your employees, you can issue them points through bonus programs tied to travel-related purchases.

If your employees use their own personal credit cards for travel expenses and are reimbursed by the company, consider issuing company cards instead. You can eliminate the task of issuing monthly employee-reimbursement checks and redeem points for a variety of rewards that can reduce your business travel budget or improve company productivity.

Cash management features. Optimally, your card account should enhance and simplify your budgeting and cash management system.

One way to maximize your working capital is to lengthen the time your funds spend in your account. A delayed-debit business card can help you do this by postponing disbursements for purchases.

A standard debit card withdraws purchases from your account within a day or two of your transactions. With a delayed debit card, however, withdrawals for all transactions made during the month occur at month's end.

If your card is linked to a central asset account, your funds remain in a money market account earning income until they are withdrawn to pay your card balance.

Here are a few other features to consider when you choose a card for your business.

?Separate numbers for each individual card. If you plan to issue cards to employees, it can be useful to have separate numbers for each card in the account. Each cardholder's transactions can then be clearly and separately reported on your monthly statement.

?Pre-set spending limits. You may want the option of assigning preset spending limits to any or all cards on a weekly, monthly, quarterly or annual basis. This helps you allocate your expense budget and increases your control over cash flow.

?Medical evacuation and repatriation coverage. Some programs provide cardholders with emergency medical assistance, eliminating one worry in traveling. Medical evacuation and return to the home country may also be covered.

?Travel assistance services. Other valuable travel convenience benefits can include domestic and overseas auto-rental insurance