My Honest Capital On Tap Review

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Get £100 credited to your Capital On Tap account with the 2REFP978R22 Capital on Tap promo code when you apply, provided exclusively to readers of this Capital on Tap review.

The Importance Of A Credit Card

One of the most important things to get right when it comes to running your own business is your cash flow management.

Cash is king, and if you want your business run to smoothly without facing un-necessary delays because you don’t yet have the money to pay your suppliers, you need to ensure that you don’t run out.

So, what’s the solution?

You could temporarily lend your business the money to bridge the gap and then repay yourself once you receive the income that you’re waiting for…  but, that’s pretty inefficient – especially if this is a regular occurrence.

If you’re a small or medium sized business, the better solution is to use a business credit card, which will completely eradicate this problem.

You’re probably familiar with how credit cards work, but maybe you’re not familiar with how they are a massive benefit to your growth, in the context of running your own business – so here’s the summary:

Every time you have a business expense – whether it be stock, advertising, or anything else – you put it on your business credit card. The result is that the supplier gets paid immediately, you receive your goods or the service that you’ve paid for, and…your cash is left untouched.

The difference, between this and paying by bank transfer or debit card, is that there is zero impact on your cash balance, until your credit card needs to be paid, which can be as much as 45 days later if you don’t want to pay any interest, and even longer if you don’t mind paying the interest in exchange for borrowing the funds.

I’ve had a credit card for each business that I run ever since I started my own businesses, and they have been fantastic at not only allowing me to grow quickly, but also at providing a range of other benefits. 

Whilst there are tonnes of great credit cards out there,  the one that I use is the Capital on Tap Credit card, which is a cashback credit card aimed at small to medium sized businesses, which is pretty much going to include the majority of people with new businesses, such as Amazon FBA sellers.

Before I run through my thoughts on the card, I do have some good news for you guys – as part of thie Capital on Tap rebview, I’ve partnered with Capital on Tap so that if you decide to apply for their free rewards card, you’ll get £100 credited to your account once you make your first purchases.

This £100 Capital on Tap promo code is exclusively for you guys (it’s normally £75), so if you want to apply, make sure you use the code 2REFP978R22 on the application form, or check out my Capital On Tap promo code here.

So,  lets run through the main features of the Capital on Tap credit card that are going to interest you if you’re a small business owner:

1% Cashback

The 1% cash back feature means that for every £1 you spend on purchases, you’ll get 1p back. Whilst that might not seem much, it really does add up over time, especially when you think that this is a VISA card that pretty much every single business out there accepts.

I use this card to purchase stock, to pay for advertising, to buy samples… and all of that expenditure adds up to provide a nice little cash back nest egg.. In fact, when I checked my account earlier, I had around £540 of points that I was able to redeem.. for literally just buying things that I was going to buy anyways, regardless of whether I had a cashback card or not.

Visa Card

It’s no secret that there are other reward credit card options on the market – but typically they are American Express, so not accepted as widely as Visa, or the reward you get are points to exchange for vouchers, which obviously isn’t as nice as cash. So..in my view, Capital on Tap wins when it comes to this feature.

No Foreign Exchange Fees

The next feature that I love, is that there are no Foreign Exchange fees when making international transactions, AND the FX rate that you get is very fair and pretty much aligned to the rate that you find on Google.

The free FX transaction feature has actually saved me a lot of cash because a lot of the services that I use to run my business are priced in US Dollars or Euros… which means I don’t have to pay expensive international transaction fees every single month, which I would have to do if I was using my Amex. And as a brucey bonus, you get that 1% cashback on any purchase, whether it be in USD or Euros, so you’re getting a little kickback there too.

Now as I mentioned earlier in the video, one of the main benefits of a credit card is that you can make purchases without having to immediately stump up the cash, which is great if you run a business where you’re expected to pay suppliers before you receive income from yoru customers.

Good Repayment Terms 

Capital on Tap give you up to 56 days to repay your credit card balance before you have to pay any interest on the balance outstanding, which gives you a huge amount of flexibility if you do run a business incurring expenses and receiving income has quite a mismatch.

As a seller on Amazon, I put all of my advertising charges on my credit card, because it means the money from my bank account doesn’t get taken for up to another 56 days, which is great because Amazon deposits the money you make from sales in your account every 2 weeks, so Capital on Tap solves the problem of mismatched timing.

Even better, when I do it this way, I get cashback points on my advertising spend, which I wouldn’t be getting if I was just using a standard debit card. Another win for Capital on Tap!

Other Features

Other features of the card are pretty much aligned to any other credit card, so I won’t talk about those in much detail, but at a high level they include the ability to do a chargeback if you purchase something not as described or if it doesn’t arrive, no fees when withdrawing cash from an ATM within the UK,  supplementary cards for business partners or employees, integration with accounting software like Xero and Quickbooks, Apple Pay – which is actually awesome because it means I don’t have to carry around the card with me whenever I go out, and finally, fantastic customer service which Is primarily done through a chat function on the website.

Downsides

In terms of downsides or considerations to make with this card, well firstly, let me just say that my experience with Capital on Tap has been excellent in the 3 years that I’ve used them. The only hiccup I had was to do with my credit allowance when I first started, where it wasn’t high enough to meet the needs of my business, which caused me problems and hampered my growth… but, after I got in touch with them, they did re-review my application and they increased it to something more sensible.

That said, the Capital on Tap website does state that they provide facilities up to £100,000 in size, but in all likelihood if you’re a fairly new Small and Medium sized business, the allowance is going to be much lower than that – I think my starting allowance was around £5,000, so remember bear that in mind when considering if this card is right for the stage of your business’ journey that you’re currently at.

The second thing to note with this card, is the interest rate. Charging interest on borrowed money is one way that credit card companies make money, and Capital on Tap are no different.

Interest rates start at 9.9% which is fairly expensive and would mean you end up paying quite a lot of interest if you don’t settle your balance in full at the end of each statement period.

Considerations

My advice is to only put expenditure on this card that you are going to be able to afford to repay when payment is due, which is up to a maximum of 56 days later – that way, you won’t pay any interest at all.

In the 3 years that I have had the card I have paid nothing in interest, because I have got an automatic direct debt to take the full amount from my account at the end of each period, which is very easy to setup and means that you won’t pay a penny in interest, but you are eligible for the cash back, the free FX transactions and all the other rewards.

If you do get this card, that would be a tip of mine to avoid paying un-necessary interest charges –  set up direct debit to repay the balance in full at the end of each period, and if you do want to borrow money over a longer amount of time to help your business grow, look at another provider who will be able to give you more preferential rates.

The next thing to take into account with this card, is the eligibility criteria. In order to be able to apply, you need to be actually turning over £2,000 of revenue per month, and be based in the UK. This revenue requirement means that you’re not going to be able to apply if you haven’t started trading yet, which is a bit of a bummer if you wanted to get cashback benefits from your first stock purchase for example. But, given the current climate that we’re in, I can understand why Capital and Tap took this decision, although I think it would have been nice to offer the card to businesses with £1,000 revenue per month, which is a bit more achievable for those just getting started.

Finally, if you’re seriously considering this card, note that there are two types – the free version, and the annual £99 fee version. There’s not a huge amount of difference between the two cards anymore – the paid one has Avios points, whereas the free one is purely cashback (which I actually prefer), which is the one that I have.

Overall, I do think that this is an essential card to have if you are a small to medium sized business,  not only because it will massively help you manage your business’ cash flow, but also because of those brilliant cashback and free FX transactions features.

Whilst there are some downsides with this card, what I would say is that they are relatively minor and they’re not really exclusive to Capital on Tap, but with regards to the high interest cost you can easily avoid that, just remember to set up your direct debit after you apply so it pays off your balance each month.

I hope you enjoyed reading my Capital on Tap review! If you have any questions about this card or Capital in Tap feel free to post a comment below and ill do my best to answer – as mentioned you can get £100 credited to your account with the 2REFP978R22 Capital on Tap referral code, so make sure you use that if you want to apply.