Credit Card Pitfalls For Business Owners

by Janet Attard
If you're a business owner with good credit, you probably take your credit card for granted. You use it to pay a lot of your business expenses – especially anything you purchase online. You don't think twice about the card, because you know the credit card company will renew your card whenever it expires. Or, if the credit card company stops providing credit and cancels all its accounts (as one credit card company did in 2009), you'll just get yourself another card. Your credit is good, so you're fine. Right?

Wrong. For business owners a cancelled or expired credit card can be a very big deal. That's because business owners often set up recurring expenses to be billed to their credit cards.

For small businesses, one of the most important recurring expenses is payment for the company's domain name(s). These are easy to forget about because they're billed once a year. If your credit card expires, the domain registrar won't be able to bill you. They'll send you an email, but if the email address you have on file with the domain registrar is old and not used any more, or gets flooded with spam, you might never see the email about the credit card failure, and as a result, lose your domain name(s).

Domain names aren't the only recurring expenses you're likely to charge to your card, either. Other charges you may have automatically billed to credit cards may include:

• Web hosting provider(s)

• Pay per click advertising services (eg, Google Adwords)

• Email delivery services (eg, Constant Contact)

• Telephone and wireless services

• VOIP phone services

• Companies that automatically ship products, inventory, or raw material on a recurring basis

• Keyword monitoring services

• Postage and shipping services

• Online survey services

• Memberships

To avoid losing a domain or having critical services stopped, you should provide an alternative credit card number to any service that allows you to keep more than one card on file. Set the one you want to use as the primary account, and the second card as the alternative. That way if the first one expires or the number changes, the company will be able to bill your alternative card.

In addition, create a list of all the recurring charges that are billed to your credit card. (A good way to remember these is to look at several credit card statements.) Next to each service, list which card you've given the service provider and the expiration date of the credit card. Include the login url for the credit card in another column. That way, when there is a change in your credit card information you'll have a single place to look to find out which service providers need to be contacted . For safety's sake, store the login IDs and passwords for the credit cards separately – preferably not on a computer that accesses the Internet.

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