Call it a cliche, but credit in fact is the lifeblood of many businesses that are small. All the talk of bootstrapping and* that is( can’t hide the point that your company’s fortunes be determined by reliable use of capital now — rather than 3 months and sometimes even three weeks from now.
Divvy is among many business credit providers that assists small and midsize businesses tap cash if they require it most. It is a step further with powerful spend tracking and management that is expense too. It’s an tool that is impressive every growing business should think seriously about adding.
Oh, and Divvy is very free for users, that makes it much more impressive. I analyze business bank account and small business credit cards for an income, and it apart while I can’t say Divvy is totally unique, the one-two-three punch of no fees, scalable business credit, and expansive money management tools legitimately sets. See what to expect from Divvy and’s decide whether it right for the company.
What Is Divvy?
Divvy offers basic financial services to small and businesses that are midsize. At its core is a business that is flexible line that will scale together with your business. In addition, it has business budgeting and expense management tools that will simplify perhaps the most complex finances that are commercial
Divvy doesn’t have any fees for users. It makes money through card interchange fees, which come out of the net received by merchants you pay with Divvy. You must pay in full each statement cycle, you don’t pay any interest on the float because you access your Divvy business credit line through a corporate charge card that.
Divvy’s most memorable benefits include a card that is customizable program with qualifying spend, a powerful mobile app, and seamless integrations with external accounting software.
How Divvy Stacks Up
Divvy isn’t the world’s business that is only solution, without a doubt. It competes against a multitude of small-business credit cards and financial institutions, each due to their strengths that are own weaknesses.
One of Divvy’s better-known competitors is the Chase Ink Business credit card family, which includes three names: Ink Business Preferred, Ink Business Cash, and Ink Business Unlimited. See how Divvy compares to Chase’s small-business credit card lineup.
Chase Ink Business Cards
$0 to $95, depending on the card
Yes, based on how you spend
No, flat or category-based rewards that don’t change
Yes, at variable rates
Flexible Credit Line?
Yes, scales with your revenue
Depends — may require a formal application for a credit line increase
What Sets Divvy Apart?
Divvy stands out for many reasons, but these four in particular stand out to me as someone who spends hours wading through financial fine print every week.
- No Interest. Divvy is a charge card, not a credit card. That means you have to pay your charges off in full at the conclusion of each billing period. Although this isn’t unusual into the global world of business credit, it’s important because it means you’ll never pay interest on Divvy draws.
- No Monthly or Annual Fees Fees. Divvy is somewhat unusual among business credit providers in its lack that is total of or annual fees to utilize this product. Divvy makes cash on the end that is back through cuts of payments made to merchants.
- Appropriate for Businesses With No Credit History. Divvy offers a credit that is secured for companies that don’t be eligible for unsecured lines. Typically, that implies new businesses without any credit rating and businesses with limited or revenue that is irregular
- Powerful Financial Software Built Into the App. Divvy has budgeting that is extensive expense management tools that integrate seamlessly using its credit services. It’s powerful sufficient to supercede your business that is current budgeting, for sure.
Key Features of Divvy
Divvy has three core features:
- A commercial credit line (technically, a corporate charge card)
- Business budgeting software
- Expense management software
The software is totally free for Divvy users, regardless of business size, though Divvy makes clear that its solutions are meant for businesses with fewer than 500 employees. Divvy makes money through card interchange fees, meaning it takes a slice that is small of transaction you will be making before passing the funds along to your merchant.
The Divvy Card may be the credit that is flexible at the heart of the Divvy ecosystem. It knits the other two divvy that is main — budgeting and expense management — together.
These would be the most crucial the different parts of the Divvy Card:
- Pay in Full. The Divvy Card is a credit card, not a charge card. This implies it is vital that you pay your charges in full from the final end of the billing period. This shouldn’t be a problem if your business has income that is steady also it’s a blessing in disguise because you’ll never pay interest.
- Flexible Credit Line. Divvy knows your enterprise is a lot more than a credit score. It considers revenue, growth potential, as well as other nontraditional factors in underwriting, that could result in a greater credit line that is initial. And your credit line can scale as your revenue increases — you can apply for an increase with just a taps that are few the app.
- As Many cards that are virtual You Need. Divvy generates cards that are virtual demand if you need them. I love virtual cards — they’re clutch for one-time and recurring expenses for which you don’t want the seller to possess use of your real card number.
- No Upfront Fees for Employee Cards. Divvy does not charge any upfront or setup fees for employee cards. It doesn’t matter how lots of people are in your team, you’ll be able to hook each up with an Divvy that is individual card.
- Enforceable Budgets and Spend Controls. A card of their own, Divvy has customizable spend controls that make it impossible for employees to overspend if you’re nervous about giving newer employees. I’d recommend setting spend limits according to seniority and role.
- Regular Credit Reporting. Divvy reports your credit utilization and payments to the Small Business Financial Exchange (SBFE), a nonprofit business credit agency that is reporting. Make use of your card responsibly and you’ll build business credit in time.
- Secured Lines of credit If You Don’t Be Eligible For an line that is unsecured*). The standard Divvy credit line is unsecured, just like a credit card that is regular. You can prefund a secured Divvy Card and still benefit from the flexibility of a credit line.
The if you don’t qualify due to limited business credit history or income Divvy Card has a rewards that are flexible that earns as much as 7 points per $1 spent (7x) on eligible purchases. You have to draw at the very least 30% of the available credit to make rewards in virtually any given billing period, along with your actual rate that is earn on your repayment frequency.
Here’s how that looks:
You can redeem points for travel purchases, gift cards, statement credits, or cash that is straight. You can get the value that is most for travel redemptions — $0.01 per point — and about $0.005 per point for all other options. So if you or your team regularly travel for business, Divvy is much more rewarding.
Spend Management (Budgeting)
Divvy’s budgeting tool makes it easy to create a tactical plan that is financial your organization.
If your business is smaller than average its finances not at all hard, you’ll be able to stay with an individual budget that covers the enterprise that is entire. Otherwise, create multiple budgets for departments or teams, adding or employees that are removing each budget as required.
Your Divvy budgets backlink to your Divvy employee cards. Due to the fact budget owner, you’ll be able to require approval for each and every employee that is single transaction or set preapprovals that allow small, routine transactions to go through without your say-so. But approval requests come straight to your Divvy app, you’re doing so it’s easy enough to approve a transaction without interrupting what. As the organization grows, you’ll be able to delegate this responsibility to team leaders and department heads.
The hidden power of Divvy’s budgeting tool is being able to spot overspending in time period, before it will become a liability that is serious. And you can generate monthly reports that provide a systematic, granular view of spending at an individual, team, department, and company level. That makes it much easier to adjust budgets on the fly.
Divvy’s expense management tool is basically your budget or budgets in action. It automates much of the work that is busy of accounting, like categorizing expenses.
Divvy integrates with third-party accounting software. When you use another program to trace business expenses for tax or budgeting purposes, you’ll be able to set your Divvy account up to mirror what you have there. That eliminates time-consuming duplicate entries and ensures your external accounting team works off the information that is same the in-house folks accountable for your business budgets.
If you don’t make use of your credit that is divvy line every business expense — and you probably won’t, at least not at first — you can use Divvy to track what it calls “off-card” expenses too. This is really important if your employees use credit that is personal to cover travel, meals, as well as other incidental expenses — simply go into the reimbursement in Divvy to ensure it is tracked along side anything else.
Advantages of Divvy
Divvy is an extensive business credit and cash management tool. The truth about it.No that it’s totally free to use grabs headlines, but there’s a lot more for business owners to like Fees or Interest on Divvy Credit Lines
. Divvy has an rewards that are unusually generous that incentivizes you to repay purchases faster. Repay you’ll and weekly earn up to 7x on eligible purchases. That’s a 7% rate of return, which will be a lot better than most business credit providers.
Disadvantages of Divvy
- Divvy is not perfect, it’s much better than the average business credit provider (and certainly better than the average business credit card) though I think. Here’s where it falls a bit short.Can’t Carry a Balance from to Month month. In case your business cash flow can’t support repaying your Divvy charges in full at the very least monthly, Divvy is not for you personally. The drawback, without a doubt, is the fact that traditional business charge cards charge interest at eye-watering rates.
No Business Banking Account
. Divvy does not have an integrated banking account, just a credit line that is flexible. You’ll need to keep your capital that is working elsewhereIs Divvy Legit?BillYes, Divvy is legitimate.
It got its start as a budgeting and expense management tool for small and businesses that are midsize then expanded into business credit lines. Today, following its 2021 acquisition by
, it’s a business that is powerful package for businesses that need to get a handle on the budgets and expenses — and tap an adaptable personal line of credit as required.
|Divvy comes with the possibility to save business users money that is serious over $10,000 per month, according to a Divvy survey. Divvy saves time, too, on the order of 12 hours per for active users month. Therefore the the greater part of Divvy users would recommend it to others.||Alternatives to think about|
|Product Service||Best for|
|Alternative Product 1||When Alterative 1 needs to be Used|
|Alternative Product 2||When Alterative 2 needs to be Used|
offers a credit that is flexible with employee subaccounts (the Divvy Card), plus powerful budgeting and expense management tools. It integrates with third-party accounting software. It delivers rewards that are outstanding eligible spend.
And it is no cost for business users.(*)Divvy feels like a deal that is good and in my educated opinion, it is. It really shines for small but growing companies with relatively steady revenues, hawklike attention to the bottom line, and an aversion to bureaucracy and work that is busy. If it feels like your company, you’d be hard-pressed to acquire an improved business credit partner.(*)