New company getting a credit card ? New Business Credit Card problem ?
I'm in the process of setting up a new limited liability company (some of you
may have seen a seperate VAT thread of mine) and for a few items of expenditure
it would be a heck of a lot easier if I had a credit card in the name of the company
that I could charge things to.
My working assumption is that I don't have a cat in hells chance of a newly formed
limited liability company with no trading history getting through a credit check and
hence getting a credit card. Is my assumption correct or has anyone managed to
accomplish this? If so then what pointers can you give me as to who to go to and
what to say?
One possible thought that I had was to act as a personal guarantor for the company
card but then, if I go to a bank and tell them that I'm setting up a business, then
surely they would then realise that my personal status is about to change to self
employed with zero years of accounts and zero immediate income so my personal
credit rating would also drop off the map for a while too. Then again, I would be
doing all the setup while I am still employed full time, I wonder if the banks/credit
agencies are too dumb to notice this!
Another desperate thought that occured to me is that I wouldn't need credit so I
would be perfectly happy with a Visa or Mastercard where I needed to pre-load
the card with a positive balance before a transaction would be authorized, i.e. if
I want to spend £100 then I need to first make a £100 payment to the card so that
when I make the purchase the balance won't drop below £0. I can't imagine that
any card issuers would go to the expense of putting this sort of system in place to
run this sort of scheme but maybe I'm wrong. If I am then I would be very interested
in finding out the names of banks that would do this.
Any personal experiences or advice would be gratefully received
I simply use a personal credit card which I dedicate totally to
company purchases, this simplifies accounting.
As far as I can see there's no disadvantages at all in doing this
(except, I suppose, my personal liability for the purchases). It's no
problem at all from the invoicing point of view, all invoices can
still be made out to my Ltd. company, it doesn't matter that it's paid
with a personal card.
In addition I have of course got a debit (Visa) card associated with
the company's business bank account but the company has to have money
in the bank to use that.