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Credit conundrum

To some people owning a credit card can be a bit of a faff, to others its a life saver. Whether you have a business or personal credit card, there are always going to be payments due and particular times when that great introductory rate runs out. Then you’re left paying interest, but we know this when we take out credit cards.

Recently I decided to take out a new card, and make the most of the offer to transfer money or purchase goods, which I wouldn’t have to pay interest on for over a year. Fabulous.

Then I think, why did I do this? Things were perfectly fine before. For years I had a card but never used it, for some reason recently its been a spending spree, but I would like to get back to the point when it is just used in dire emergencies.

Business credit cards tend to be used to purchase goods related with the business. Now, usually credit cards will not allow you to transfer a balance into a regular bank account, it is only to be used on another card, some do allow transfers into an account but on very rare occasions.

So what if you’re stuck in need of some instant cash flow for your business. Yes you can purchase materials and products on the card no problem, but unless you’re Alan Sugar, I don’t think your limit would be anywhere near £100k, what next?

Factoring is a fantastic solution, it allows you to gain capital quickly and efficiently using the money tied up in invoices you send out to clients. So if your company needs to grow, you require more machinery, vehicles or materials, you can’t always rely on a credit card. Factoring compared to the interest and repayments on a credit card, is a minimal cost. So everyone is happy and you have the cash to do with what you like, which may involved paying off aforementioned credit card :(

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