Best Small Business Credit Card
Setting up a business takes a lot of work and there are plenty of things to consider. One of the decisions you have to make is whether or not you want a business credit card and, if so, you'll have to choose the one that is best suited for you.
Business credit cards can be a valuable tool in streamlining your finances. They can help keep your personal and business expenses separate, which is important for many reasons including organizing your taxes each year. Also, business cards don't affect your personal credit score, and it helps establish your businesses own credit history.
Business Credit Cards: What to Consider
Choosing the right card depends on what kind of business you have, what your spending habits are and what kind of rewards you want. Here are some things to think about when you are looking at different cards.
- Consider how you typically spend and pay your bills. Do you pay in full at the end of each month? Do you pay over time and use credit?
- What expenses do you have? Compare the savings of travel reward miles or cash back.
- Pay attention to annual percentage rates. They often change so researching this and asking the credit card company yourself is the best way to get an accurate number.
- A card that allows you to pay your bill with the cash you earn is preferable. If you have to use it to buy something, you miss out on earning more cash on the purchase.
Business credit cards often have excellent perks, sometimes more so than a personal credit card. Choosing the right card for your particular business can really help you streamline your finances and it can get you cash, travel miles or other perks that may be ideal for your business.
Chase Ink Cash Business Credit Card Review
- No annual membership fee
- Competitive cash back program
- Introductory bonus
- 0% APR for the first six months
- Travel and emergency insurance benefits
- High cash back rates are limited to the first $25,000
- Foreign transaction fees
If you've decided that cash back is going to be the biggest advantage for your business, then the Chase Ink Cash Business card is an excellent place to start your search. It is a highly reputable card and the recipient of many accolades from business magazines and websites. As an incentive, the card offers a nice introductory bonus. If you spend $3,000 in the first 3 months you will get an extra $200 cash back. If you plan on using this as the main card for your business, this is a nice perk.
The cash back rewards system is fairly competitive. Each year the first $25,000 you spend on business needs like office supplies, mobile phones and land-line service and even cable TV and internet will earn you 5% cash back. You can also earn 2% on the first $25,000 each year in purchases made at restaurants and gas stations and 1% on all other purchases. If your business expenses a represented in this rewards program, the Ink Cash card could really be worthwhile.
Although, the rewards program offers competitive cash back rates, the limitation of $25,000 a year before your 5% on office supplies drops to 1% is a bit of a drawback. If your business spends money in a variety of areas or spends moderately in the areas that are covered by the rewards program, then it still may be worth it. Plus, other factors like 0% APR for the first six months and the fact there is no annual membership fee may entice you. However, if your company spends a lot in those areas each year, it may be better to look at another card.
Verdict - Superb
Ink Cash Business card is a solid choice for small to medium sized companies who can take advantage of their rewards program. Large companies who spend large amounts of money on things like office supplies or phone bills may want to look for a program with higher limits or none at all.
Capital One Spark Cash Credit Card Review
- 2% cash back on everything
- No fee for adding cards
- Bonus for adding cards in the first 60 days
- Easy to earn signing bonus
- No balance transfer fees
- $65 annual fee
- No extra cash back for specific purchases
If your business has more offbeat expenses than typical office supplies and phone bills, then it is a good idea to find a card with a higher cash back rate for all purchases. The Capital One Spark Cash card offers 2% cash back on all purchases, which is preferable to the 1% that many other cards offer. There is no perk that allows you to earn extra cash on specific purchases, but for companies with unique expenses 2% on everything may be better.
The Spark Cash card has a few other benefits that make it great for business. Instead of being charged a fee to add a card to your account, you can add cards at no additional cost. This lets you give company cards to your employees. Plus, if you add an additional card during the first 60 days you will receive a $50 dollar bonus.
Signing up comes with a lot of incentives including a very easy to earn bonus. If you spend just $1,000 in the first three months you can get $100 cash back. Although, this bonus is smaller than some other cards, the $1,000 prerequisite is easy to get with normal spending. Also, if you want to transfer a balance from another card, there is no transfer fee.
There is an annual fee of $65 after the first year, but this is comparatively low. If you find the card's benefits appealing they may be worth the fee.
Verdict - Great
The Spark Cash card from Capital One has a variety of perks that are designed around business. There is an annual fee and no high cash back rates for specific purchases but this can be overlooked if the benefits work for you.
Plum Card Credit Card Review
- 1.5% discount for paying early
- No interest for 60 days after early payment
- Flexible payment scheduling
- Extra days to make payments without fees
- Helpful travel benefits
- High annual fee
If you are on top of your company's finances and you faithfully pay off expenses there is a card that will reward you for your hard word. The Plum Card from American Express rewards early payments with a 1.5% discount or you can get 60 days to pay without interest. That means if you pay at least the minimum payment, you can get the discount or forgo paying interest on your balance for 2 months.
On the other end of the spectrum, maybe you often fail to make payments on time and tend to incur late fees. The Plum card allows you to take up to 60 days to pay your fee as long you pay at least 10% of the new charges. Plus, you can choose when to receive your bill, if certain times of the month are financially better than others.
Flexible payment options and rewards for early payments are an excellent feature for a business card to have but there is a pretty big drawback. Though there is no annual fee during the first year, there is a $250 annual fee for each year after that, which is quite high.
Verdict - Very Good
American Express offers several interesting features with their Plum card including flexible payment options and travel benefits like emergency assistance and information services. However, the high annual fee is an issue unless you can cover it with the early payment benefits.
CitiBusiness Thank You Credit Card Review
- High rotating point rewards system
- Varied redemption program
- No annual fee
- Loyalty rewards through anniversary point bonus
- Signing bonus
- Fee for exceeding credit limit
- You have to keep track of rotating cash back categories
The CitiBusiness Thank You card employs a rewards system that is different than typical cash back or travel miles. The Thank You card offers rewards in the form of "Thank You Points" that can be exchanged in a diverse redemption program. Points can be used to buy things like office supplies and other practical necessities or they can be converted to cash or travel miles. Three points per dollar are earned for specific purchases based on a quarterly rotating system. For instance, during one quarter buying gas will earn you three points per dollar and in the next quarter office supplies will give you that return. This can be a nuisance for anyone who doesn't want to keep track of a rotating system but it can be beneficial to a business that has a variety of expenses.
The Thank You card earns its name with their anniversary bonuses which reward you for your loyalty. Not only will you earn a bonus 1500 points if you spend $3,000 in the first three months, you will also earn bonus points based on the number of years you have had the card.
There is a $39 fee for exceeding your credit limit, which means you have to watch your spending carefully.
Verdict - Good
The CitiBusiness Thank You Card is a decent business card with an interesting rewards program and several perks. If you don't like keeping track of the rotating rewards program this card may be a burden.
U.S. Bank Business Cash Rewards Credit Card Review
- Simple cash back system
- Unlimited cash earnings
- Great loyalty rewards program
- No annual fee
- Cash earnings are only paid after $25
U.S. Bank's Business Edge Cash Reward card offers a straight forward rewards program that is tailored for business. You can earn 3% cash back on common business expenses like office supplies, gas and cell phone bills and 1% on everything else. With a simple and practical cash back rewards system it is easy to earn cash depending on your businesses expenses.
There is no limit to what you can earn back and each year, the card rewards loyalty by awarding 25% of the previous year's earned cash as a bonus. This can result in some big rewards.
Cash back rewards only come after you've earned $25 dollars or more, which means if you'd like some extra cash but haven't yet reached that level you will have to wait.
Verdict - Good
U.S. Bank has a simple and competitive cash back system and great loyalty rewards. The fact that you have to wait to earn $25 before getting your money can be bothersome if you are desperate for extra cash, but depending on your spending, $25 may come quickly.
Choosing a business credit card has a lot to do with the way you spend your money. Choose a rewards program that best suits your company. Also, if travel miles are more appealing to you than cash, many of the top cash cards have mile earning counterparts.
Business Credit Cards FAQs
What type of business credit card rewards program do I need?
The type of business credit card you choose largely depends on the way you do business and the expenses you usually have to deal with. Your card's reward program should reflect the things you pay for, for two reasons.
You should find a program that rewards you for spending money on the things you normally spend money on. If you work from home and tend not to spend much on gas each month, a card that rewards you for spending at gas stations probably isn't for you.
Also, if you spend a lot traveling each month, it may be worth it to find a card that rewards you with travel miles rather than just simple cash rewards.
Do I need a business credit card for my extremely small business?
Even the smallest businesses are eligible for a credit card but that doesn't necessarily mean you should get one. For instance, a freelancer technically owns their own business, even according to the IRS. The right card may be an advantage by helping you separate your personal and business finances. It can also give access to business cards with better perks than the ones available to individuals.
However, some business cards are designed around larger business. They may come with great perks but some high fees as well. Do extensive research before signing up for any card.