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Key takeaways
- Business credit cards can help small business owners manage their cash flow and track employee spending.
- However, business cards can also offer perks such as software discounts, travel benefits and enhanced purchase protection.
- To choose the right card for your small business, start by understanding your spending habits so that you can pick the perks that matter most to you.
Small business owners and entrepreneurs can benefit from opening a business credit card for more reasons than one. For starters, a business credit card extends a line of credit business owners can use to improve their cash flow, and some cards even offer a 0 percent intro APR for a limited time. This perk can benefit business owners who need to make a major purchase — such as for inventory or equipment — that they want to pay off over time, interest-free.
Business credit cards also make accounting for spending considerably more accessible, as every purchase the business owner and their employees make will be fully documented on their monthly account statement.
However, other lesser-known perks also exist and can be highly valuable for the right business owner. As you compare business credit cards to find the right fit, look for options that offer some (or most) of the following business credit card perks.
1. Free employee cards
Many business credit cards give you the option to dish out cards to all your employees at no additional charge, which is a significant plus. One example is the Capital One Spark Miles for Business. If each employee has their own card, you’ll spend less time reimbursing employees for business purchases they paid for themselves. You’ll also get a full accounting of every purchase each employee makes on your account statement each month.
Having dedicated credit cards for trusted employees can also help you earn cash back or other rewards for all your business spending instead of just some of it. Also note that rewards employees earn typically go into the primary cardholder’s account, so you can use them any way you prefer.
2. Accounting software integrations
Some business credit cards also offer in-depth reporting on your business expenses each year, including the Capital One Spark Cash Select. This small-business credit card also makes it easy to download your spending records using multiple software programs such as Quicken, QuickBooks and Excel. WebBank’s Capital on Tap Business Credit Card promises similar integrations with tools like Xero, FreeAgent, QuickBooks and more.
Having a way to upload your business purchases into a software program automatically can save you considerable time compared to inputting that information manually. Plus, syncing your credit card with your accounting software automatically makes you less prone to mistakes and other accounting issues; in-depth reporting can help you make smarter spending decisions in the future.
3. Software and service discounts
Some business credit cards also offer annual credits for select software programs or discounts on certain services. The Business Platinum Card® from American Express is the best such example since it offers some of the following credits and discounts for cardholders who pay its annual fee:
- Up to $400 in statement credits on Dell purchases (up to $200 semi-annually)
- Up to $360 in statement credits on Indeed hiring and recruiting products and services (up to $90 per quarter)
- Up to a $150 statement credit on select Adobe purchases annually
- Up to $120 in statement credits for direct purchases from any U.S. wireless telephone provider (up to $10 back per month)
Another similar perk is the opportunity to earn rewards on the software and services you already pay for. For example, the American Express® Business Gold Card earns 4X points on up to $150,000 per year in two select categories your business spends the most in each billing cycle. Categories include advertising (purchased in the U.S. to promote your business online, on TV or radio); U.S. shipping costs; U.S. computer software, hardware and cloud data purchases made directly from select providers; airfare purchased directly from an airline; U.S. gas stations; and U.S. restaurants.
4. Consumer protections
For many small business owners, a broken or stolen piece of equipment — from a laptop to a sewing machine — can bring sales to a halt. And if money is tight or you’re bootstrapping your business, you may be unable to afford a replacement. But did you know that business credit cards often supply a benefit that can help in such a situation?
The Ink Business Unlimited® Credit Card is a good example in this category since cardholders automatically get purchase protection worth up to $10,000 per claim and $50,000 per account each year. This coverage is good for up to 120 days from the purchase date of the affected item and applies to most instances of damage or theft.
This card also adds extended warranties on eligible items you purchase that already come with a manufacturer’s warranty. Specifically, this coverage adds one year of additional warranty protection to manufacturers’ warranties of three years or less.
5. Travel benefits and rewards
Credit card travel rewards and perks are no secret, but it helps to consider the specific ones you’ll need for business travel. Are you often paying for Wi-Fi to work during long flights? Would lounge access help you wait out long layovers more productively? With the right credit card, you can access amenities that make your business travel less expensive and more convenient.
Select business credit cards offer perks like airport lounge access, credits for TSA PreCheck and trip cancellation insurance. For example, the Ink Business Preferred® Credit Card from Chase offers trip cancellation and interruption insurance worth up to $5,000 per person and $10,000 per covered trip, as well as primary auto rental coverage you can use in place of your own car insurance.
The bottom line
Choosing a business credit card is never easy, especially if you want to maximize the number of features and perks you get. After all, most business credit cards offer some of the benefits listed above, but not all of them. This means you’ll have to do your own research to find the right business credit card for your needs. In the meantime, you may have to prioritize some credit card perks over others you want.
To find the best card for your small business, compare the individual benefits of the best business credit cards available today. From there, decide which benefits you want the most, and try to sign up for a card that offers them for free or gives you the most rewards for using them.
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