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The turbulent global economy is leading to a trend of rising interest rates and lower credit limits, which is bad for cardholders and in some cases good for credit card companies. Even cardholders who have made all of their credit card repayments on time and in full have experienced raised interest rates in the past two years. However, there are many credit card companies that have been taking losses as well, and many retail chains have decided to stop providing store credit cards.

The Dangers of Universal Default

This economic uncertainty has led many banks and credit card companies to participate in the universal default policy, which makes it very easy for every credit card company to raise interest rates after a single late payment or payment default.

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When the CARD Act passed, some skeptical observers complained that it had a big loophole.   The CARD Act only covered personal cards.   Business cards, also known as professional cards were deemed exempt.   At the time, I speculated that credit card companies would be unlikely to have two different sets of rules for business and personal cards.   Apparently, I gave the banks too much credit.

Some Business Cards Go By The Old Rules

According to this article in the Wall Street Journal, some banks are choosing to exploit the business card loophole.   The article cites CitiBank as applying payments to the lower interest rate balances first, and for raising interests rates sharply in the event of a missed payments.   Both actions would be prohibited if the card was a personal card, not a business card.   The article does give Capitol One recognition for applying the CARD Act rules to it’s business cards.

What Is The Deal With Business Cards?

Frankly, I have always wondered why these cards exist.   They are a great tool for someone like me who wants to receive multiple sign up bonuses.   When a really killer deal is out there, I have been known to sign up for both the personal and the business cards.   As for legitimate uses, my belief has always been that a business card can allow you to segregate your business expenses from your personal expenses.  I have operated a number of small ventures, but I never had any trouble distinguishing my business expenses from my personal ones.   If my business grew, I could see how it would be nice to have a different card, although I am not sure why it would have to be a business card, rather than a different personal card.

Some business cards offer the feature of having multiple additional cards for employees with the rewards accruing for the primary cardholder.   I would hate it if my job asked me to charge a bunch of stuff to a company card where I didn’t see any rewards.   Hypocritically, I would be the first to have such a card if I had people under me who needed to purchases for my business.

For now, I would still consider getting a business card for the sign up bonus, but as always, I don’t imagine really using it much.

Balance transfers are perhaps the easiest way to consolidate credit card debt and pay off multiple balances simultaneously. By consolidating the debt to a credit card with a low interest rate, the cardholder can effectively reduce the total amount of debt that needs to be repaid in the long term.

In fact, if a credit card with a zero APR introductory period is used as the main balance transfer card, then it is possible to completely eliminate interest and pay the balance off with no interest charged.

Unfortunately, there are occasions when balance transfer cards are used incorrectly, causing even more debt rather than reducing it.

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Establishing a business credit line is one of the best ways to create a positive financial environment for a business to grow through gradual investments. Although a lot of businesses choose not to establish a business credit line, for fear of damaging the company’s credit, the benefits usually outweigh the risk of negative repercussions caused by irresponsible spending. The following are the benefits of a business credit line:

Building a Credit Score

Positive credit scores are beneficial for businesses as they foster a reputation for financial trustworthiness that can be established no other way. A

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It is an interesting point to note that the term ‘credit card’ was first used in a novel – a novel structured around utopia. Looking Backward is a novel of great literary importance. Written by American Novelist, Edward Bellamy, in 1887, the novel tells the story of a young man born in late 19th century America, who falls asleep and wakes up a hundred and thirty years later to find his world completely changed. Like any other novel attempting to define the world in futuristic terms, this novel also lays claims to many erstwhile unheard of concepts. One such was the Credit card.

After finding mention in the novel, the first credit card first came into being in the 1920s. The e

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