Divvy Evaluate – Credit score Playing cards & Expense Managment for Companies

Name it a cliche, however credit score actually is the lifeblood of most small companies. All of the discuss of bootstrapping and expense-slashing can’t disguise the truth that your organization’s fortunes rely upon dependable entry to capital now — and never three months and even three weeks from now.

Divvy is one among many enterprise credit score suppliers that helps small and midsize companies faucet money once they want it most. It goes a step additional with highly effective spend monitoring and expense administration instruments too. It’s a powerful device that each rising enterprise ought to suppose critically about including.

Oh, and Divvy is completely free for customers, which makes it all of the extra spectacular. I analyze enterprise financial institution accounts and small enterprise bank cards for a residing, and whereas I can’t say Divvy is completely distinctive, the one-two-three punch of no charges, scalable enterprise credit score, and expansive cash administration instruments legitimately units it aside. See what to anticipate from Divvy and resolve whether or not it’s proper on your firm.

What Is Divvy?

Divvy gives fundamental monetary companies to small and midsize companies. At its core is a versatile enterprise credit score line that may scale with what you are promoting. It additionally has enterprise budgeting and expense administration instruments that assist simplify even probably the most advanced business funds.

Divvy doesn’t have any charges for customers. It makes cash by card interchange charges, which come out of the online obtained by retailers you pay with Divvy. Since you entry your Divvy enterprise credit score line by a company cost card that you should pay in full every assertion cycle, you don’t pay any curiosity on the float. 

Divvy’s most notable advantages embrace a customizable card rewards program with qualifying spend, a strong cellular app, and seamless integrations with exterior accounting software program.

How Divvy Stacks Up

Divvy isn’t the world’s solely enterprise credit score answer, after all. It competes in opposition to a slew of small-business bank cards and mortgage suppliers, every with their very own strengths and weaknesses.

One in every of Divvy’s better-known rivals is the Chase Ink Enterprise bank card household, which incorporates three names: Ink Enterprise Most popular, Ink Enterprise Money, and Ink Enterprise Limitless. See how Divvy compares to Chase’s small-business bank card lineup.

Divvy Chase Ink Enterprise Playing cards
Annual Price $0 $0 to $95, relying on the cardboard
Versatile Rewards? Sure, based mostly on the way you spend No, flat or category-based rewards that don’t change
Expenses Curiosity? No Sure, at variable charges
Versatile Credit score Line? Sure, scales together with your income  Relies upon — might require a proper software for a credit score line enhance

What Units Divvy Aside?

Divvy stands out for a lot of causes, however these 4 specifically stand out to me as somebody who spends hours wading by monetary wonderful print each week.

  • No Curiosity. Divvy is a cost card, not a bank card. Which means you need to repay your fees in full on the finish of every billing interval. Whereas this isn’t uncommon on this planet of enterprise credit score, it’s vital as a result of it means you’ll by no means pay curiosity on Divvy attracts.
  • No Month-to-month or Annual Charges Charges. Divvy is considerably uncommon amongst enterprise credit score suppliers in its whole lack of month-to-month or annual charges to make use of the product. Divvy makes cash on the again finish, by cuts of funds made to retailers.
  • Acceptable for Companies With No Credit score Historical past. Divvy gives a secured credit score line for companies that don’t qualify for unsecured strains. Sometimes, which means new companies with no credit score historical past and companies with restricted or irregular income.
  • Highly effective Monetary Software program Constructed Into the App. Divvy has intensive budgeting and expense administration instruments that combine seamlessly with its credit score companies. It’s highly effective sufficient to interchange your present enterprise budgeting software program, for positive.

Key Options of Divvy

Divvy has three core options: 

  • A business credit score line (technically, a company cost card)
  • Enterprise budgeting software program
  • Expense administration software program

The software program is completely free for Divvy customers, no matter enterprise measurement, although Divvy makes clear that its options are meant for companies with fewer than 500 workers. Divvy makes cash by card interchange charges, that means it takes a small slice of each transaction you make earlier than passing the funds alongside to the service provider.

Enterprise Credit score

The Divvy Card is the versatile credit score line on the coronary heart of the Divvy ecosystem. It knits the opposite two major Divvy options — budgeting and expense administration — collectively.

These are an important elements of the Divvy Card:

  • Pay in Full. The Divvy Card is a cost card, not a bank card. This implies you should pay your fees in full on the finish of the billing interval. This shouldn’t be an issue if what you are promoting has regular earnings, and it’s a blessing in disguise since you’ll by no means pay curiosity.
  • Versatile Credit score Line. Divvy is aware of what you are promoting is greater than a credit score rating. It considers income, development potential, and different nontraditional elements in underwriting, which might result in a better preliminary credit score line. And your credit score line can scale as your income will increase — you may apply for a rise with just some faucets within the app.
  • As Many Digital Playing cards As You Want. Divvy generates digital playing cards on demand everytime you want them. I personally love digital playing cards — they’re clutch for one-time and recurring bills the place you don’t need the seller to have entry to your actual card quantity.
  • No Upfront Charges for Worker Playing cards. Divvy doesn’t cost any upfront or setup charges for worker playing cards. Regardless of how many individuals are in your crew, you may hook every up with a person Divvy card. 
  • Enforceable Budgets and Spend Controls. For those who’re nervous about giving newer workers a card of their very own, Divvy has customizable spend controls that make it unattainable for workers to overspend. I’d advocate setting spend limits based mostly on function and seniority.
  • Common Credit score Reporting. Divvy stories your credit score utilization and funds to the Small Enterprise Monetary Alternate (SBFE), a nonprofit enterprise credit score reporting company. Use your card responsibly and also you’ll construct enterprise credit score over time.
  • Secured Credit score Strains If You Don’t Qualify for an Unsecured Line. The usual Divvy credit score line is unsecured, identical to an everyday bank card. For those who don’t qualify as a result of restricted enterprise credit score historical past or earnings, you may prefund a secured Divvy Card and nonetheless profit from the flexibleness of a credit score line.

The Divvy Card has a versatile rewards program that earns as much as 7 factors per $1 spent (7x) on eligible purchases. You have to draw not less than 30% of your accessible credit score to earn rewards in any given billing interval, and your precise earn fee is determined by your compensation frequency.

Right here’s how that appears:

Repay Weekly Repay Semi-Month-to-month Repay Month-to-month
Eating places 7x 4x 2x
Lodges 5x 3x 2x
Recurring Software program 2x 1.75x 1.5x
Every part Else 1.5x 1x 1x

You’ll be able to redeem factors for journey purchases, reward playing cards, assertion credit, or straight money again. You get probably the most worth for journey redemptions — $0.01 per level — and about $0.005 per level for all different choices. So in the event you or your crew commonly journey for enterprise, Divvy is rather more rewarding.

Spend Administration (Budgeting)

Divvy’s budgeting device makes it straightforward to create a tactical monetary plan for what you are promoting. 

If your organization is small and its funds comparatively easy, you may keep on with a single price range that covers your complete enterprise. In any other case, create a number of budgets for departments or groups, including or eradicating workers from every price range as wanted.

Your Divvy budgets hyperlink to your Divvy worker playing cards. Because the price range proprietor, you may require approval for each single worker card transaction or set preapprovals that enable small, routine transactions to undergo with out your say-so. However approval requests come straight to your Divvy app, so it’s straightforward sufficient to approve a transaction with out interrupting what you’re doing. As your group grows, you may delegate this duty to crew leaders and division heads.

The hidden energy of Divvy’s budgeting device is its means to identify overspending in actual time, earlier than it turns into a critical legal responsibility. And you may generate month-to-month stories that present a scientific, granular view of spending at a person, crew, division, and firm degree. That makes it a lot simpler to regulate budgets on the fly.

Expense Administration

Divvy’s expense administration device is principally your price range or budgets in motion. It automates a lot of the busy work of enterprise accounting, like categorizing bills.

Divvy integrates with third-party accounting software program. So in the event you use one other program to trace enterprise bills for tax or budgeting functions, you may arrange your Divvy account to reflect what you’ve got there. That eliminates time-consuming duplicate entries and ensures your exterior accounting crew works off the identical data because the in-house of us chargeable for your organization budgets.

For those who don’t use your Divvy credit score line for each enterprise expense — and also you most likely gained’t, not less than not at first — you should utilize Divvy to trace what it calls “off-card” bills too. That is actually vital in case your workers use private bank cards to pay for journey, meals, and different incidental bills — merely enter the reimbursement in Divvy to make sure it’s tracked together with every little thing else.

Benefits of Divvy

Divvy is a complete enterprise credit score and cash administration device. The truth that it’s completely free to make use of grabs headlines, however there’s much more for enterprise homeowners to love about it.

  • No Charges or Curiosity on Divvy Credit score Strains. Divvy Card credit score strains don’t cost charges or curiosity. This can be a huge benefit over pay-over-time enterprise bank cards that may cost curiosity at 20% APR or greater and infrequently cost annual charges north of $100.
  • Limitless Digital Playing cards. There’s no restrict on the variety of digital playing cards you may generate with Divvy. Use them for recurring subscriptions, one-off funds, and some other state of affairs the place you’d choose to maintain your actual card quantity protected.
  • Seamless Integration With Divvy Instruments and Exterior Accounting Platforms. Your Divvy Card account integrates seamlessly with Divvy’s budgeting and expense administration instruments. For those who use an exterior accounting platform, you may hook it as much as Divvy too. This can be a huge consider why customers surveyed by Divvy mentioned it saved them 12 hours per thirty days on common.
  • Versatile Spend Limits on Worker Playing cards. You may have the ultimate say over how a lot your workers spend (or don’t) on their worker playing cards. And you may approve or decline transactions with just a few faucets. If overspending is the norm for what you are promoting, perhaps Divvy is the reply.
  • Versatile Rewards Program (As much as 7x Again). Divvy has an unusually beneficiant rewards program that incentivizes you to repay purchases quicker. Repay weekly and also you’ll earn as much as 7x on eligible purchases. That’s a 7% fee of return, which is best than most enterprise credit score suppliers.

Disadvantages of Divvy

Divvy isn’t excellent, although I feel it’s significantly better than the typical enterprise credit score supplier (and positively higher than the typical enterprise bank card). Right here’s the place it falls a bit quick.

  • Can’t Carry a Stability From Month to Month. If what you are promoting money circulate can’t assist repaying your Divvy fees in full not less than month-to-month, Divvy isn’t for you. The disadvantage, after all, is that conventional enterprise bank cards cost curiosity at eye-watering charges.
  • No Enterprise Financial institution Account. Divvy doesn’t have a built-in checking account, only a versatile credit score line. You’ll must hold your working capital elsewhere.

Is Divvy Legit?

Sure, Divvy is reliable. It bought its begin as a budgeting and expense administration device for small and midsize companies, then expanded into enterprise credit score strains. As we speak, following its 2021 acquisition by Invoice, it’s a strong enterprise finance bundle for firms that wish to get a deal with on their budgets and bills — and faucet a versatile credit score line as wanted.

Divvy has the potential to save lots of enterprise customers critical cash: over $10,000 per thirty days, in accordance with a Divvy survey. Divvy saves time, too, on the order of 12 hours per thirty days for lively customers. And the overwhelming majority of Divvy customers would advocate it to others.

Alternate options to Contemplate

Product Service Greatest for
Various Product 1 When Alterative 1 Ought to Be Used
Various Product 2 When Alterative 2 Ought to Be Used
and many others. and many others.

Ultimate Phrase

Divvy gives a versatile credit score line with worker subaccounts (the Divvy Card), plus highly effective budgeting and expense administration instruments. It integrates with third-party accounting software program. It delivers excellent rewards on eligible spend.

And it’s completely free for enterprise customers.

Divvy seems like a great deal, and in my educated opinion, it’s. It actually shines for small however rising firms with comparatively regular revenues, hawklike consideration to the underside line, and an aversion to forms and busy work. If that seems like what you are promoting, you’d be hard-pressed to discover a higher enterprise credit score associate.

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