How to Find the Best Credit Card for Small Businesses: Understanding Fees and Cashback Rewards
If you own a small business and are looking for a way to simplify your expenses, then you need to be extra careful when choosing a business credit card. Finding the best credit card that suits your needs as a small business owner is, however, no easy task.
Read our guide below to find the best business credit cards with cashback rewards, no annual fees, and more.
Most small business credit cards offer plenty of benefits such as free employee cards, special financing and other rewards that are designed to be beneficial to entrepreneurs.
Shopping for business credit cards for points can help your business generate some income from your daily purchases.
Below are some of the important factors to consider when looking for a business credit card:
Different types of credit card fees
This is one of the important factors to consider when choosing a credit card for your business. Different banks have varied types of fees on their cards.
You should know the types of fees and how much they charge annually. There are some companies that offer no fee business credit card while others will charge a few hundred dollars.
It is always assumed that the higher the fees, the more benefits you will get, such as reimbursement for airline fees as well as exclusive airport lounges. It is, however, still possible a no fee business credit card that offer many benefits to your business.
Below are different types of fees charged by banks:
- Balance transfer fees – In case you are transferring huge amounts of money from your personal account, a fee of 3% and 5% can make a lot of difference. Some banks do not allow balance transfer.
- Cash advance fee – If your business is in need of quick cash and the cash advance fee is probably 4%, 5% or 6% of the cash total amount requested, then the difference matters a lot.
- Foreign transaction fee – If your business involves frequent travel or purchase of inventory from overseas, then you might want to choose a card that doesn’t charge this fee.
Cashback rewards
This is another important factor to consider when it comes to choosing a credit card for your business. It is important to go for a credit card that offers bonuses for your frequent purchases. This means that your business will benefit from the constant and many purchases conducted daily.
Nonetheless, some credit cards usually offer cashback rewards to purchases exceeding a certain amount of dollars every year. For example, after your business has reached the maximum bonus limit, you can only earn the standard bonus given to all other credit card owners.
The best strategy to get the most out of cashback rewards for your purchases is to have more than two credit cards. You can decide to apply for two credit cards that offer the largest amount of cashback rewards.
Credit score status
Your credit score plays a big role in determining which credit card to apply for your small business. In other words, the higher your credit score, the higher the chances of getting a high rewards card.
As such, ensure that you have checked your credit score is high enough to help you get a business credit card that offers a lot of rewards. There are different ways through which you can check your credit score – although not all of them are free.
If you have a lower credit score, the flexibility of the options available to you is far lower. Lower credit scores are not deal breakers for most credit card offers, but it will play a role in what kinds of rates and rewards you can expect. If getting a top notch business credit card with full benefits is important to you, keep an eye on your credit score and work on improving it over time.
Credit cards that earn airline mileage
Airline mileage is another key factor to consider when shopping for a business credit card. Try looking at the perks offered by each bank to determine which credit card is best for your business. This consists of airline miles you get as well as other incentives such as new member offers and other associated benefits.
The JetBlue Business card is often considered the best credit card for this type of benefit. The credit card offers more than just your transactions with the airline. Besides the purchase rewards, this credit card has a welcome bonus as well as an anniversary bonus for all its card holders.
Signup bonuses
Most reward cards offer sign-up bonuses to all their new members. It is therefore good to be on the lookout for credit card companies that offer substantial bonuses when you sign up for their credit cards. Although that should not be entirely a determining factor, it is a positive gesture towards potential customers.
Regular bonuses
As a small business owner, you will definitely want to take advantage of discounts, cashback rewards and regular bonuses from your small business credit card. A good credit card company should be able to offer reward credit cardholders for their purchases as well as long-time membership.
In a nutshell, there are several things that you should consider before picking the best credit card for small business owners. Business credit cards for points are beneficial – particularly for active small business in terms of purchases.
Considering the fact that there are many credit card companies available, it is best to shortlist and choose one that offers the most benefits for your small business.
