More small businesses are relying on 'plastic' (credit cards) to finance their businesses. That shouldn't be a big surprise. I feel as if I don't even carry cash any more myself.
A recent report by the Small Business Association confirms this. Part of this is the result of lenders encouraging an increase in credit card loans.
Yes, we are becoming a credit card nation. I don't need to tell you the dangers of this. Paying high interest rates, accidently failing to pay on time, floating the debt, fraud, etc.
And then there are other dangers you can't even imagine or predict. I recently meet an entrepreneur who finances his whole venture with his credit card, hoping that his VCs would pay him back. Guess what happened. He never received his money, went broke.. and his company went under. Lesson of the day. Think twice before relying on plastic....
This is too true! I find myself often reaching for the plastic even when I'm just at the gas station buying a bottle of water. I usually apologize to the cashier feeling bad that I'm charging $1.19. It does, afterall, cost them about .25 just to run the card. Even the big fast food restaurants have caught on to the trend. It seems just about everywhere accepts plastic for pay now. I agree, we should all think twice before reaching for the plastic, and yet knowing myself I'm not sure cash can work it's way back into my life!
By the way, over at www.divitaspeaks.com you've been memed!
Posted by: Chloe | December 20, 2006 at 06:53 PM