Credit strategies for your business

Flexible repayments, low interest rates, travel points or cash back offers, here's some ideas to improve cash flow and retain customers.

It’s difficult to find one credit solution that does everything you want it to do for your business.

Some products offer flexible repayment options, others low interest rates. However, more and more feature attractive rewards such as travel points or cash back on purchases.

Combining credit products

One side of you may be attracted to low interest rates and a high credit limit, while another side may crave the rewards. It’s a conflict that may be difficult to resolve using just one credit solution.

Instead, consider combining credit products to harmonize your favorite features – such as matching a rewards credit card with a low interest rate line of credit. Here’s how to do it:

Open a business line of credit

Business lines of credit typically carry attractively low interest rates and high borrowing limits so you’ll have access to affordable cash when you need it. For example, Scotiabank offers the:

Obtain a rewards credit card

There are different types of rewards cards. Two of the more popular types offer either cash back or reward points for travel. Additional benefits also make these credit cards attractive to business owners such as:

  • Emergency medical insurance.
  • Automobile rental coverage.
  • Extended warranty on purchases.

For example, Scotiabank offers the:

Use your rewards credit card to make all of your day-to-day business purchases, from office supplies to meals to transportation, or even recurring payments. The more you use it, the more rewards you will accumulate.

Pay the entire balance

Pay your balance on the rewards card each month using cash, your business line of credit or some combination of the two. Be sure to pay the rewards credit card balance in full within the interest free grace period before interest is incurred, as the interest on these cards are typically high.

Using this two-credit product system, your business will receive perks on every dollar it spends while enjoying low borrowing rates. By taking advantage of the grace period on the rewards card, you can improve cash flow with interest free credit.

For extra convenience, set up an automatic monthly payment for the rewards card so the balance is paid directly from your business line of credit account.

Tailor your products to your needs

Offering this type of creative credit solution can provide business owners with much more benefit than anything available from a single credit product. Two credit facilities will allow you to tailor the products to your specific needs and preferences:

Momentum for business credit card

To give business owners flexibility and customization, Scotiabank recently launched a new cash back rewards credit card called the Scotia Momentum for business VISA card.

The Scotia Momentum for business VISA card carries a number of smart features. It provides:

  • Enhanced cash back benefits of up to 3% on eligible purchases.
  • A low annual fee.
  • A low minimum credit limit that makes it attractive to start-ups and newer businesses.

Best of all, it features a 25-day grace period – giving business owners extra time to pay for purchases which can enhance cash flow.

Combining the Scotia Momentum for business VISA card with a ScotiaLine for business VISA card creates some very attractive benefits. The ScotiaLine for business VISA card product is different because it offers the flexibility and convenience of credit card access, low interest rates and no annual fees.

There's a 21-day interest-free grace period on purchases. There's also a free balance transfer service that allows you to transfer higher interest balances from your other credit cards, so you can save money.

To find out more about any of these Scotiabank borrowing solutions, please contact a Scotiabank Small Business advisor today.

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