You may remember that a while back I changed my business account to NatWest after a series of problems and complete lack of customer services at Barclays. When setting up this new account I was offered the chance to sign up for a NatWest business card, which I took.
The card is basically a MasterCard, looking and working in much the same way. It is accepted at around a quarter of a million outlets in the UK and over twenty seven million worldwide. Like a normal card you can also use it for purchases on the net, over the phone and by post.
Effectively the card is a short reprieve from paying for something. Once the card is used you will receive a detailed statement every month. The difference between this and many normal credit cards is that the full amount on the statement will be taken by direct debit from your business account after seven days. This will happen regardless of whether you have enough funds in your account and therefore could take you overdrawn at which point you will be liable for any charges as set out in the contract with the bank.
The biggest problem with this is that whilst you can save money for a month you must make sure that you will have enough funds to cover the amount used on the card. All transactions are interest free and counting the seven days after the statement has arrived you get almost forty days of it. Another bonus is that all transactions are also free. Every business owner will know how cost effective this can be as the charges for withdrawing cash, paying in cheques, etc is absolutely ludicrous.
The actual cost of the card is £25 for a year, although new accounts like myself are given it free for a year. This free period will allow me to work out how much money I would have saved over the year and after just a few months I can already tell you that the £25 fee is well worth it.
One of the things that did disappoint me is that it cannot be used in cash machines to withdraw money directly off the card. This would be useful in times when the bank is shut and I’m in a situation where you have to pay by cash.
To apply for the card you must already have a business account at NatWest and therefore already pass their criteria. Application can be done online instantly or by downloading an application form, at your local NatWest branch or over the phone. The whole process takes less than five minutes due to the fact that you will already be a customer of theirs and they will be able to evaluate the application in seconds. Once you have been accepted the card will be sent to your either your business or home address within five working days or you can call into your bank to collect at after the same period.
For me the card has been excellent. It allows me to delay payment of certain bills for over a month and helps me keep on top of my cash flow. This would be particularly good for those just starting out in business, when there are so many costs to contend with. The free period has also helped me establish this and got me used to making sure that I have sufficient funds to cover the amount every month. The business managers are happy to set the fee in accordance with usage and turnover – which they will evaluate every year.
I would recommend that everyone who has a business account at NatWest should try this for the free period and evaluate the costs and savings before signing up for the second year. As I’ve already said though, with the costs incurred through transactions I’m sure 99% of businesses would save money.
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Good luck with NatWest - I seem to have nothing but bad experiences with them - their customer service SUCKS in my experience! Great op. Vicki
miniloopie 02.12.2003 10:01
Not something Ill be trying in the near future but it does sound like a good idea in principle.. just dont know that I would be organised enough to keep up with it all!
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