When considering how to finance a business, several options come to mind. Among those are business loans, investors, and even credit cards. While the first two require other people’s involvement in your business, the final one does not. A business credit card can help get a new business venture started or be used to continue growing one. Credit cards are less of a hassle than a personal loan and may be ideal for startup costs or to make the most of regular spending. One or more of the four popular cards described below could be the perfect fit for your business. Each card comes with perks and advantages to maximize the benefits of your business purchases. Every card on this list comes with extended warranty protection and no foreign transaction fees. Read on to discover which card will work best for you and your business.
Chase Ink Preferred
The Ink Preferred comes with the highest sign-up bonus at this list at 80,000 points. To earn that bonus, customers must complete $5,000 in purchase spending within the first three months of opening the account. At $95, the annual fee is typical and the benefits justify the cost. Points earned depend on the spending category with cardholders earning 3 points for every $1 spent in the following categories: travel, shipping, telecommunication, and advertising spending online. These bonus points are limited to the first $150,000 in spending each anniversary year. All other purchases earn points at 1:1 rate. The Ink Preferred also provides access to the Chase Ultimate Reward portal where points are worth 1.25 their value when redeemed for travel. Additional benefits include trip cancellation/interruption insurance and auto rental insurance.
Advantages – access to Chase Ultimate Rewards portal, high sign-up bonus
Disadvantage – no introductory APR, no waived annual fee
Capital One Spark Cash
Capital One has a trio of Spark business cards with this particular card coming out on top. The Spark Cash carries the same annual fee as the Ink Preferred, but the fee is waived for the first year, giving customers essentially free access to all of the benefits. Among the perks is a $500 cash bonus after the new cardholder reaches $4,500 in spending within the first three months. This card earns users unlimited 2% cash back on all purchases and travel/emergency assistance. Like other reward heavy cards, it requires excellent credit. However, Capital One offers the no annual fee Cash Classic as an option for business owners who may not qualify for the Spark Cash.
Advantages – waives annual fee for year one, unlimited cash back
Disadvantages – limited redemption options, limited travel protections
American Express Business Gold Rewards
In stark contrast to previously mentioned cards, Business Gold cardholders get to pick which category will allow them to earn the most points. The available categories are airfare, advertising, gas, shipping, and computing or hardware. Customers select one category from which to earn 3x points. In the other four categories, points are earned at a 2x rate with all other purchases earning at 1x. Those who sign up for this card can get a jumpstart on points by earning the 50,000 point bonus after spending $5,000 within the first three months. At $175, the annual fee is nearly double that of the Ink Preferred and Sparks Cash, but the fee is waived for the first year. More perks for this card include travel accident, car rental, and baggage insurance. It’s important to note that this is a charge card and customers must pay the balance in full each month.
Advantages – waived annual fee for year one, choice of high earning category
Disadvantages – high annual fee, required to pay the balance in full
Bank of America Business Advantage Travel Rewards
This business travel card is the only no annual fee card on this list. Ideal for business owners with frequent travel, this card is simple and straightforward. The sign-up bonus is low at 25,000 points but can be easily reached by spending $1,000 in first 60 days the account is open. Purchases earn unlimited points at 1.5 points for every $1. That rate doubles with any travel booked through the Bank of America Travel Center. On top of not having an annual fee, this card also offers 0% APR for the first 9 months. Points can be redeemed as statement credits for travel purchases, which includes baggage fees, gift cards or cash back.
Advantages – 0% introductory APR, no annual fee
Disadvantages – low sign-up bonus
Important Facts to Know About Business Cards
- The financial behavior with the business credit card is reported to the business credit bureaus. Additionally, some financial institutions report business card activity, including negative information, to personal credit bureaus. Remember that how you use your business credit card may affect your personal creditworthiness.
- Consider the major spending categories for your business when selecting a card. Do you and your staff travel often? Are most of your large purchases on technology? Use that information to decide which one would provide the most benefit to you and your business.
- To be eligible for some of the spending bonuses, bills or utilities may need to be in the business’s name.
- If you find that you no longer want a card with an annual fee, there may be an option to downgrade the card to a no annual fee option rather than closing or abandoning the account. In the case of the Chase Ink and Capital One Spark, both lines have no fee cards that may be an option for your business. However, this often means forfeiting some of the benefits associated with the higher-level card.
