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How to pay business bills on time without hurting cash flow

A woman paying her business bills online with a credit card.

Regardless of how big or successful your business is, you can’t always have optimal cash flow. At one point or another, every business owner faces this predicament: Your bills are due but you need some more time to get the cash. This happens for a multitude of reasons.

Sometimes you’re waiting for a check that’s still in the mail, other times a big contract fell through at the last minute, or maybe your customer is experiencing their own cash flow issues, leading to late payments.

Luckily, there’s a way to pay all your bills on time and still keep cash at hand to manage your business.

A business owner’s dilemma

Paying your business bills on time is crucial for maintaining the good relationships you’ve worked so hard to build with your vendors and suppliers. It also helps avoid late fees, penalties, and even litigation. On the other hand, healthy cash flow is another key to business success as it ensures you can handle any bumps in the road.

Sometimes your business’s cash flow situation can put you in a temporary bind. You know you’ll have the money soon, but your next bill is already due. Regardless of why this happened, you’ll need to decide between three almost equally bad options:

  1. Paying now. This means depleting your cash reserves, leaving your business more vulnerable.
  2. Paying late. This could seriously harm your relationship with the vendor as it directly affects their business’s financial health.
  3. Asking for an extension on your due date. While this may be better than simply being late, it can still damage the trust and flexibility your vendor is willing to extend to you in the future.

But, what if we told you there was a fourth option that would allow you to pay now while keeping the cash for up to 60 additional days? Not only that, but the solution is already in your wallet and just a few clicks away.

With a digital payment tool, like Melio, you can pay any business bill with a credit card* and enjoy all the great perks that come with it.

Business bills+credit card=perks and float

Paying business bills with a credit card sounds almost too good to be true.

For your vendors, it means they get paid immediately, so your relationship isn’t harmed. At the same time, you get to hang on to your cash until your next billing cycle, which could mean almost two months of additional float. It’s like taking out a short-term loan but without the paperwork, risk, and impact on your credit history.

And, the best part? You get to collect points, cashback, miles, and other card perks on large business transactions that otherwise went unrewarded. This means that just by paying your bills you can make significant savings on your future business travel, to name just one example of how this benefits your business.

It’s all about choices

Whether they’re looking to save on processing fees or just feel that accepting credit cards is too much of a hassle, for business-to-business (B2B) transactions, many vendors prefer to be paid by check or bank transfer.

In fact, a recent report by market research company Insider Intelligence, predicts that B2B check transactions will exceed $12 trillion in 2022, up from $11.8 trillion in 2011. B2B credit card payments are only expected to amount to $1.8 trillion this year, while ACH bank transfers amount to $11.75 trillion.

For many companies, checks and bank transfers are a matter of habit, it’s just the way it’s always been done. They’re unlikely to change that just because it’s more convenient for you to pay with a card. But, that’s okay, because they don’t even need to know how you paid.

With Melio, you can pay any bill with a credit card and your vendor will still get paid any way they like: paper check, ACH bank transfer, or single-use virtual card. In other words, both you and your vendor get to choose the payment method that works best for your business, without affecting each other’s workflows.

Start paying business bills with a credit card

In your private life, you probably use your credit card for almost every expense, earning points and rewards wherever you go. It’s about time your business enjoys the same perks.

In addition to card rewards, paying with a credit card allows you to keep cash longer. And, it offers flexibility and float without affecting your vendor and your relationship with them. So, if you’re in a cash flow jam, sign up for Melio and start paying your bills with a card today.

*Subject to card limitations. 2.9% tax-deductible fee applies.

*This blog post is intended for informational purposes only and is not intended as financial advice.
**Melio does not provide legal, tax or accounting advice, and you should consult with a professional advisor before making any financial decisions.