Tips for protecting your business credit and debit cards

Business credit cards and debit cards come with many perks. They’re vital to helping you take care of your small business operational expenses and can also help you build your business credit. Credit cards can even help you better manage your cash flow.

Of course, like with any credit or debit card, using business credit or debit can also open you up to theft and fraud. We’ll offer a few tips for protecting your business credit and debit cards so you can bank with confidence.

Why use a business credit card or debit card over cash?

Using cash for your business isn’t ideal. For one, cash doesn’t leave a record of your transactions, making it harder to track your expenses and reconcile your accounts. Most customers and vendors prefer credit or debit cards for financial transactions for this reason, as well as being more secure.

Here’s a closer look at the benefits of using a debit or credit card for your business:

• Helps build business credit: Business credit cards are a great way to build your business credit. Just as you build your personal credit to get favorable rates when buying a home or car, you want a good business credit history for better terms on business loans or a business line of credit down the road.
• Improves cash flow: Running a business requires ongoing expenses, some expected and some unexpected. By using a credit card, you can free up your cash flow to meet monthly expenses, as well as the less predictable ones.
• Makes transaction tracking easier: Using either a credit or a debit card will make it easier to track your business transactions. If you want to know how much you spend on supplies or services each month, all the information you need is at your fingertips. This knowledge can help you make more thoughtful and informed financial decisions when it’s time to adjust your budget.
• Offers protection from theft and fraud: Cash makes you much more susceptible to theft. With a business credit or debit card, you can be sure that no unauthorized charges or purchases are made from your account. Of course, there is still the risk of fraud—but if you spot something suspicious, you can lock your card immediately or contact your credit or debit card company for a replacement.

How credit card fraud can impact your business

Despite business credit card benefits, credit card fraud is real, and its impact can be detrimental to your business.

• Fraud can disrupt your cash flow, making it more difficult to meet your business’ financial obligations.
• Your business reputation or vendor relationships could be damaged.
• You’ll feel compelled to incur more operational costs for fraud detection and prevention.
• Fraud loss sometimes means losing inventory you haven’t been compensated for.
• Credit card fraud can result in declined or canceled orders, making it harder to budget for your business.

These things not only interrupt your business but also rob you of peace of mind. But fraud is preventable, and it’s easier to protect yourself and recover from card transaction losses than if you lose a lot of cash.

Ways to protect your business from credit card fraud

Ultimately, the best way to protect your business from credit or debit card fraud is to follow security best practices for your cards and account information. Your diligence, combined with your cards’ built-in fraud protection features, can help keep your business operating smoothly and prevent fraud attempts.

Keep card details secure.

Always keep your business credit card with you or in a secure location. Take advantage of card providers and banks that offer secure ways to share access to your card with co-owners or your team. For example, you may be able to order multiple credit or debit cards for your team members, and you might even be able to use virtual cards (more on this below). 

When making purchases, make sure the source is legitimate and reputable before providing your card information, especially when discussing card details over the phone.

Review statements regularly.

Often, the first way to discover fraudulent card activity is by reviewing your business credit card statement. Look for charges you don’t recognize, and promptly report any unfamiliar charges to your credit card issuer.

Report suspicious activity immediately.

If you see any activity that you didn’t authorize or that looks fraudulent, report it promptly to your card issuer.

When in doubt, lock your card.

If you misplace or lose your business credit card or debit card, or suspect it has been compromised or stolen, immediately log in to your online account or contact the card issuer to lock your card. This will help prevent unwanted charges from unauthorized users.

Follow password best practices.

A few password security practices can go a long way in keeping your credit card information safe. First, never log in to your credit card account or make purchases on public WiFi. It’s an easy way for fraudsters to steal your information. 

Also, avoid using the same password for multiple websites, and don’t share your password with anyone. Select a unique password that exceeds or meets the site’s password suggestions.

It’s also a good idea to update your passwords frequently and use multi-factor authentication when possible. Your bank or card issuer should be using multi-factor authentication to validate your account when you sign in.

Restrict employee permissions.

Restrict access to staff you trust and limit how much they’re allowed to spend on your company’s business credit card or debit card. The fewer people permitted access to your card accounts, the less likely fraudulent activities are to occur.

Some cards may offer customizable restrictions, which let you set limits based on where authorized users can shop using the card.

Use a virtual credit card.

Virtual business credit cards are great for both online and in-person purchases, since you can also add them to your digital wallet. If you want to bolster your fraud protection, share virtual cards with your co-owners and team members—they have different card numbers than your physical card, so your account information won’t be compromised if the card number falls into the wrong hands.

Built-in credit card fraud protection

A business credit card can help give you more spending power to run your business and fuel its growth. While fraud is always a concern with business credit cards and debit cards, most card issuers offer built-in fraud and theft protections designed to shield you against unauthorized use. 

To set your business up for safe and effective credit and debit card usage, implement security best practices like keeping your card details private, checking your statements regularly, reporting suspicious activity, and using virtual cards when possible.