*Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any credit card issuer. This site may be compensated through a credit card issuer partnership.
This article was last updated Jul 19, 2019. Terms and conditions may have changed. For the most accurate information, please consult the issuer website.
As a small business owner, odds are there’s a lot on your plate. You have to deal with customers, employees, vendors, bills and more, to keep things up and running. Using a personal credit card for business expenses isn’t the wisest choice in the long-run and can lead to headaches come tax season.
That’s where a business credit card can be a great asset by simplifying your purchasing and bill paying. You can earn rewards, benefit from special financing and various protections and track employee spending if you choose to add employee cards.
We’ll review the basics of business credit cards and the key features you should consider before choosing one.
1. Understand how business credit cards work
Before deciding to apply for a card, you should familiarize yourself with several key characteristics of business cards:
- Personal liability. In most cases, you — as the business owner — are personally liable for any charges made on your business card account. That includes charges employees make on the account.
- Less protections than personal cards. Purchases you make with a business card are not protected under the laws of the CARD Act, so you may see sudden rate increases without notice or shortened grace periods. As a result, it’s very important to pay on time and in full every month.
- Charge card vs. credit card. There are two types of business cards: charge cards and credit cards. A charge card has no preset spending limit (though that doesn’t mean unlimited spending) and you’re required to pay your balance in full each month. Meanwhile, a credit card has a preset spending limit, but allows you to carry a balance month-to-month, with interest. It’s also important to note business charge cards don’t offer introductory 0% APRs, while business credit cards do.
- Employee cards. One of the main perks of a business card is the ability to streamline spending across your business. You can open multiple employee cards to help you track spending and avoid reimbursing them for business charges made on personal cards. Plus, most business cards provide employee cards at no additional cost. Just remember, you’re responsible for all charges employees make on your account, so have clear charging policies in place as well as procedures to review all employee card purchases.
Check out our guide on the benefits of free employee business cards.
2. Review your business’s spending habits
The next step is to evaluate your business’s spending habits. Look over your books from the past year to pinpoint common operating costs. Once you identify a repeating spending categories, you can search for a business card that will reward you for those purchases. For example:
- Does my business require frequent travel? If yes, it can be a good idea to consider a card that doesn’t charge a foreign transaction fee and rewards travel spending, such as the Ink Business Preferred℠ Credit Card — Earn 3 points per $1 on the first $150,000 spent in combined purchases on travel, shipping purchases, Internet, cable and phone services, advertising purchases made with social media sites and search engines each account anniversary year. Earn 1 point per $1 on all other purchases—with no limit to the amount you can earn.
Earn 80,000 bonus points
Earn 3 points per $1 in select business categories
Points are worth 25% more when you redeem for travel through Chase Ultimate Rewards
- Earn 80,000 bonus points after you spend $5,000 on purchases in the first 3 months from account opening. That's $1,000 toward travel when you redeem through Chase Ultimate Rewards®
- Earn 3 points per $1 on the first $150,000 spent on travel and select business categories each account anniversary year
- Earn 1 point per $1 on all other purchases–with no limit to the amount you can earn
- Points are worth 25% more when you redeem for travel through Chase Ultimate Rewards
- Redeem points for travel, cash back, gift cards and more – your points don't expire as long as your account is open
- No foreign transaction fees
- Employee cards at no additional cost
- $95 Annual Fee
See additional details for Ink Business Preferred℠ Credit Card
- Do I entertain clients at restaurants? Consider a card that rewards dining purchases, such as the American Express® Business Gold Card offering Get 4X Membership Rewards® points on the 2 select categories where your business spent the most each month*
$500 back in the form of statement credits by purchasing qualifying services with FedEx using your American Express® Business Gold Card within the first 3 months of Card membership. | Limited time Offer ends 11/06/2019.*
Get 4X Membership Rewards® points on the 2 select categories where your business spent the most each month*
No foreign transaction fees & many helpful business tools*
- Earn up to $500 back in the form of statement credits by purchasing qualifying services with FedEx using your American Express® Business Gold Card within the first 3 months of Card membership.
- Limited time Offer ends 11/06/2019.*
- MORE REWARDS: Get 4X Membership Rewards® points on the 2 select categories where your business spent the most each month**
- **4X points apply to the first $150,000 in combined purchases from these 2 categories each calendar year.*
- AIRLINE BONUS: Get 25% points back after you use points for all or part of an eligible flight booked with Amex Travel, up to 250,000 points back per calendar year.*
- PAY OVER TIME OPTION: A flexible payment option to help manage cash flow on purchases of $100 or more.*
- Access to the Working Capital Terms program: get additional funding beyond what you can spend on Business Gold with this flexible funding solution designed to pay U.S. based vendor invoices directly when cards are not accepted.*
- *Terms Apply
- See Rates & Fees
See additional details for American Express® Business Gold Card
- Is driving a big part of the day-to-day of my business? A card with higher rewards for gas purchases may help offset the cost, when cash back is redeemed as a statement credit. The Bank of America® Business Advantage Cash Rewards Mastercard® credit card offers 3% cash back on your choice of one of the following six categories: gas stations (default), office supply stores, travel, TV/telecom & wireless, computer services or business consulting services, 2% cash back on dining (for the first $50,000 in combined choice category/dining purchases each calendar year, 1% thereafter) and 1% cash back on all other purchases.
3% cash back on your choice of one of the following six categories: gas stations (default), office supply stores, travel, TV/telecom & wireless, computer services or business consulting services, 2% cash back on dining (for the first $50,000 in combined choice category/dining purchases each calendar year, 1% thereafter) and 1% cash back on all other purchases.
$300 statement credit when you make at least $3,000 in net purchases within 90 days of your account opening
Redeem rewards for cash back or apply them to your bank account
- Get a $300 statement credit when you make at least $3,000 in net purchases within 90 days of your account opening – with no annual fee and cash rewards don't expire.
- Earn 3% cash back in the category of your choice, 2% cash back on dining and unlimited 1% cash back on all other purchases.
- You'll get 3% and 2% cash back on the first $50,000 in combined choice category/dining purchases each calendar year, 1% thereafter.
- 0% Introductory APR on purchases for your first 9 billing cycles.
- Redeem your cash rewards as a statement credit, check, or have cash deposited into a Bank of America® checking or savings account.
- Get 75% more cash back on every purchase when you’re a Preferred Rewards for Business Platinum Honors tier member. That means you will earn 5.25% on your selected choice category, 3.5% on dining and unlimited 1.75% cash back on all other purchases.
See additional details for Bank of America® Business Advantage Cash Rewards Mastercard® credit card
- Do I spend on typical business purchases, such as at social media and internet advertising? Once again, the Ink Business Preferred℠ Credit Card offers a high cash back rate for this type of spending. Earn 3 points per $1 on the first $150,000 spent in combined purchases on travel, shipping purchases, Internet, cable and phone services, advertising purchases made with social media sites and search engines each account anniversary year. Earn 1 point per $1 on all other purchases—with no limit to the amount you can earn..
- Unclear spending habits? A flat-rate cashback card may be the answer. If your business’ needs are constantly changing and you can’t find specific categories that you spend in, a business card offering a straightforward cashback program can be a good choice. The Capital One® Spark® Cash for Business offers 2% cash back for your business on every purchase, everywhere.
2% Cash Back for your business on every purchase, everywhere
Earn a $500 cash bonus once you spend $4,500 on purchases within 3 months from account opening
Redeem cash back for any amount at any time
- Earn unlimited 2% cash back for your business on every purchase, everywhere
- Earn a one-time $500 cash bonus once you spend $4,500 on purchases within 3 months from account opening
- $0 annual fee for the first year; $95 after that
- $0 Fraud Liability if your card is lost or stolen
- Free employee cards, which also earn unlimited 2% cash back on all purchases
- Rewards won't expire for the life of the account, and you can redeem your cash back for any amount
See additional details for Capital One® Spark® Cash for Business
3. Consider added perks
Business cards can provide a wide range of benefits beyond streamlining business spending and earning rewards. Many of the best business cards have special financing offers, spending management tools, purchase protections and more. Here are some perks to consider when comparing business cards:
- Free employee cards. It’s fairly common for a business card to offer employee cards at no additional cost, but just check the terms before you choose a card, since some premium business cards may charge a fee for employee cards.
- Special financing. Many business credit cards offer intro 0% APR periods on new purchases that typically range from nine to 15 months. During this time period, you can carry a balance without incurring interest charges. If you need to make expensive purchases, such as laptops, printers or office furniture, choosing a card with a special financing period can be a great asset.
- Spend management tools. Business cards often offer a suite of perks that make it easy to track spending. Some spending management tools include quarterly and year-end summaries, itemized receipts, the ability to export transactions to Excel or other accounting software and more.
- Purchase protection and insurance. The additional benefits provided by business cards can provide you with added protection for unexpected events that would typically require out-of-pocket costs. Look out for business cards that offer purchase protection, extended warranty protection, travel insurance, auto rental damage collision insurance and more.
- Airline fee credits. Select premium business cards offer the coveted airline fee credit, but beware that these cards typically come with steep annual fees. For example, The Business Platinum® Card from American Express offers an annual $200 airline fee credit (terms apply), but has a $595 annual fee. While the added perks of this card can outweigh the annual fee, do the math to make sure.
Earn up to 100,000 Membership Rewards® points*
Complimentary access to over 1000+ airport lounges*
Get 50% more Membership Rewards® points. That's 1.5 points per dollar, on each eligible purchase of $5,000 or more*
- Welcome Offer: Earn up to 100,000 Membership Rewards® points.
- Earn 50,000 Membership Rewards® points after you spend $10,000 and an extra 50,000 points after you spend an additional $15,000 all on qualifying purchases within your first 3 months of Card Membership.
- Get 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com.
- Get 50% more Membership Rewards® points. That's 1.5 points per dollar, on each eligible purchase of $5,000 or more. You can get up to 1 million additional points per year.
- 35% Airline Bonus: Use Membership Rewards® Pay with Points for all or part of a flight with your selected qualifying airline, and you can get 35% of the points back, up to 500,000 bonus points per calendar year.
- Enroll to get up to $200 in statement credits annually by getting up to $100 semi-annually for U.S. purchases with Dell. Terms apply.
- Get one year of Platinum Global Access from WeWork. With this membership, you can access 300+ premium, inspiring workspaces in 75+ cities. To get this exclusive offer, enroll between 2/15/2019 and 12/31/2019.
- Terms Apply
- See Rates & Fees
See additional details for The Business Platinum® Card from American Express
Now that you’ve familiarized yourself with the basics of how business cards work and what they have to offer, you should be ready to choose a card. We’ve rounded up the best small business credit cards in several categories from travel and cashback rewards, to luxury benefits and borrowing, that can help your business streamline spending and save on everyday purchases.
Terms apply to American Express credit card offers. See americanexpress.com for more information.
Terms apply to Chase credit card offers. See chase.com for more information.