How To Pick The Best Credit Card For Your Small Business

Filed Under: Business, Credit Cards
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For the most part business credit cards didn’t used to be nearly as rewarding as personal credit cards. However, over the past few years that trend has changed significantly.

Presumably this is because card issuers finally see the amount of potential in this space, especially since a lot of businesses put a significant amount of spending on credit cards.

For those new to business cards, though, picking a card can be a daunting task. So in this post I wanted to look at the thought process I recommend going through in deciding which business credit card to get.

There are quite a few factors to consider, so let me address a few of those points.

Do You Want To Earn Points Or Cash?

In general you’ll be rewarded for your business spending in one of two ways — either with cash back, or with some sort of points currency. I’d say this is probably the biggest thing to decide upfront, because these are obviously very different ways of getting rewarded.

Some businesses like earning cash back that they can put back into their business. Meanwhile others prefer earning points rewards, either so they can use those points to pay for some business travel they’d take anyway, or to actually take the time to plan a great vacation.

For example, if you want to earn cash back, it’s tough to beat the Capital One® Spark® Cash for Business (review), which offers 2% cash back on all purchases, with no caps.

Some businesses like earning cash back rewards…

If you are going to earn a points currency through credit card spending, I highly recommend using a card that accrues a transferable points currency. These are points that give you a lot of flexibility, as they can typically be transferred to a variety of airline and hotel partners, or in some cases even be redeemed towards the cost of a travel purchase.

For example, the Ink Business Preferred® Credit Card (review) offers points that can be transferred to about a dozen airline or hotel partners through Ultimate Rewards, or can be redeemed for 1.25 cents each towards a travel purchase.

Alternatively, the Capital One® Spark® Miles for Business (review) offers two Spark miles per dollar spent, and they can either be redeemed for one cent each towards the cost of a travel purchase, or can be transferred to airline partners at a ratio of up to 2:1.5.

Other businesses prefer to earn points they can redeem towards vacations…

Are You Willing To Pay An Annual Fee?

Once you’ve decided how you want to be rewarded, the next step is deciding if you’re willing to get a credit card with an annual fee. I know a lot of people are hesitant to get cards with annual fees, though if you spend any sort of significant amount on credit cards, I’d highly recommend it.

Why? Cards with annual fees are likely to have much bigger welcome bonuses (which can offset annual fees), are more likely to have no foreign transaction fees, and are more likely to have better bonus categories (and earn you more points or cash back), etc.

But don’t worry, even if you’re not willing to pay an annual fee, there are still some good options out there. For example, The Blue Business® Plus Credit Card from American Express (review) has no annual fee (Rates & Fees) offers 2x Membership Rewards points on the first $50,000 spent every calendar year, so I actually consider that to be the single best credit card out there for the first $50,000 spent annually, bar none.

Redeem Amex points for travel in Lufthansa’s first class

If you’re looking for cash back, the no annual fee Ink Business Unlimited℠ Credit Card (review) offers 1.5% cash back (though you can potentially do better with that card — more on that below).

What Categories Do You Spend Most In?

Credit cards offer bonus categories, where you can earn 2-5x points for spending in select categories. Getting a credit card that has bonus categories that coincide with your business’ spending patterns can make a huge difference.

To give some examples of cards that offer big bonus categories on spending:

  • The Ink Business Preferred® Credit Card has a $95 annual fee and offers 3x points on travel, shipping purchases, internet, cable, and phone services, and advertising purchases with social media sites and search engines (on the first $150,000 in combined purchases per account anniversary year)
  • The Ink Business Cash℠ Credit Card (review) has no annual fee and offers 5x points on office supply stores, internet, cable, and phone services, and 2x points on gas stations and restaurants (on the first $25,000 in combined purchases per account anniversary year)
  • The American Express® Business Gold Card (review) has a $295 annual fee and potentially offers 4x points on airfare purchased directly from airlines, U.S. purchases for advertising in select media, U.S. purchases at gas stations, U.S. purchases at restaurants, U.S. purchases for shipping, and U.S. computer hardware, software, and cloud computing purchases made directly from select providers; the way it works is that you earn 4x points in the two categories you spend the most in each billing cycle, on up to $150,000 of spend in those categories each calendar year

In my opinion, those are the three business cards with the best bonus categories, though as you can see, there are potentially significant differences between them.

Spend a lot on dining? One card offers 4x points in that category, while the others offer 1x points. Spend a lot at office supply stores? One card offers 5x points in that category, while the others offer 1x points.

Some cards offer bonus points for your business dining purchases

Are You Willing To Get Multiple Cards?

I know a lot of people are hesitant to get more than one credit card, even though I think that’s a big missed opportunity. So when considering which business credit card is best, I’d recommend trying to decide whether you’re comfortable getting more than one card or not.

This can impact which card makes the most sense, since if you’re getting just one card, you’re going to want for it to be really well rounded.

But if you’re willing to get two cards, there are so many more opportunities. For example:

  • If you’re thinking of getting the Ink Business Preferred® Credit Card for the no foreign transaction fees, airline and hotel transfer partners, 3x points in select categories, cell phone protection plan, etc., there’s huge value to complementing that with the Ink Business Unlimited℠ Credit Card, which offers 1.5x points on all purchases; then you could use the Ink Preferred for the 3x points categories, and the Ink Unlimited for all non-bonused purchases so you’re earning 1.5x points per dollar spent, and then you can pool points
  • Similarly, if you’re thinking of getting the American Express® Business Gold Card, I’d recommend complementing that with The Blue Business® Plus Credit Card from American Express; you can take advantage of the 4x points categories on the Gold Card, and then put your first $50,000 of spending every calendar year that wouldn’t be eligible for a bonus on the Blue Business Plus, so you earn 2x points, and then you could pool points

Sometimes you can maximize your value by getting multiple cards

Do Perks Matter To You?

So far the focus has been on maximizing the points you can earn with your business credit card, and that’s for good reason, since that’s where you’ll get the most value.

However, some businesses may be very focused on getting cards with perks instead. This could come in a few different forms. For example:

These are all perks that everyone is going to value differently, so you need to decide what’s most important for your business.

Some cards offer lounge access as a perk

Do You Need Credit Card Financing?

Whether we’re talking personal or business credit cards, in general, I recommend only using credit cards if you’re going to be able to pay off your balance in full each month. While you can finance credit card charges, the interest rates are typically very high, and will more than negate any rewards you might earn.

However, some businesses are growing and could use some financing, in which case there are some credit cards offering 0% financing as an introductory offer. If that’s something that could be useful to you, that’s not a bad option.

Cards with introductory interest rate offers

In a bind that could be a useful feature to take advantage of. Just make sure you pay that off before the rates go up.

Which Business Card Is Best?

As you can see, there are lots of different factors to consider here, and there’s no “one size fits all” answer. However, for someone just getting started with credit cards, I’d say the following are my general thoughts on the best place to start:

Picking The Best Business Card Summary

There are so many great business credit cards nowadays, so there’s no “one size fits all” answer as to which card is best. As outlined above, there are certainly some cards that are better than others, and also some cards that just about anyone can’t go wrong with, in my opinion.

Ultimately which card is best comes down to what you value most — is it the best card bonus categories, perks, financing, or something else?

The following links will direct you to the rates and fees for mentioned American Express Cards. These include: American Express® Business Gold Card , and The Blue Business® Plus Credit Card from American Express (Rates & Fees).

The comments on this page have not been provided, reviewed, approved or otherwise endorsed by any advertiser, and it is not an advertiser's responsibility to ensure posts and/or questions are answered.
  1. I have always wondered this: if you are owner of a business whose cards earn points, and you transfer these points to yourself for private use, do you pay taxes?

  2. Erm, why would anyone take out a new card at the moment for travel perks. Even meeting spend for an introductory offer might be tough. Isn’t the best option right now with cards to do… nothing?

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