Learn from our Northern California CPA Firm the Pros and Cons of Using a Credit Card to Run Your Business

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Running a business takes a significant amount of time. It also means you may have to use your personal financial resources to get projects up and running. Many business owners use a credit card for operating expenditures. Make sure you speak with your local Northern California CPA firm about the risks of this process before reaching for the card. In this latest post, we’ll explain the pros and cons of this approach.


  • Convenience

Credit cards provide you with round-the-clock access to capital. This can be important when those unexpected expenditures arise on short notice.

  • Rewards

When you’re using credit cards to run parts of your business, you’ll be rewarded for the vast sums spent with points. You can then use those points on further expenditures.

  • Maintain equity

Instead of providing equity in your business to a lender for a loan, you can use credit cards to maintain control of your business. This can help ensure you’re fully protected against the actions of other stakeholders.


  • Liability

One of the leading cons of using a credit card to run your business is that if credit cards are your main funding resource you’ll be on the hook for the costs if the business fails.

  • Negative impact on credit

If your business struggles, the impact on your credit rating can be immense.

  • Low limits

A leading element that many don’t consider when using their credit cards is the limit on the card. What happens if you use the card and reach the limit before all expenses are paid?

  • Costly way to finance

Using a credit card is one of the most expensive ways to finance a business. You might have a zero percent interest rate at first, but this rate will rise over time, and you may not be ready for the added expenditure.

Make sure you take the time to speak with a local Northern California CPA firm about your business financing before using a credit card. Our team at Montgomery Taylor in Northern California represent a CPA firm with decades of experience. To discover more about this important topic, call today.