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Business credit cards could help you better track your expenses, manage employee spending, and access other financial tools. Other benefits of a business credit card could include rewards, such as airline miles or cash back rewards on qualifying purchases.
Before adding a new business credit card, consider the benefits and decide which type of rewards card could make sense for your enterprise.
Understanding Business Credit Card Benefits
Card issuers may offer potential business credit card benefits, which could help your small business manage regular business purchases and investments in its growth. Some of these benefits may include tools to issue and track employee credit cards, as well as the ability to automatically categorize your transactions.
What Are the Potential Benefits of a Cash Back Card?
A cash back credit card may offer businesses the potential to earn a rebate on their qualifying purchases. Depending on the issuer and the credit card, you may be able to receive a flat rate on all purchases or higher bonuses on certain categories.
For example, say your business cash back credit card earns 5% cash back on purchases at office supply stores, but 2% back on other purchases. If your business purchases $10,000 per month of office supplies, you could get $500 cash back on those purchases.
How Your Business Can Maximize Cash Back Rewards
You could leverage the benefits of a business credit card by maximizing the cash back you receive on purchases. One potential strategy is to choose a card that offers higher rewards for purchase categories on which you spend the most.
You could also consider timing purchases to help you qualify for a new card member offer, which could require you to spend a certain amount within a predetermined period of time. Using multiple credit cards to maximize cash back earnings may be another option for your business, but that may require you to track which card offers bonus earnings for certain spending categories.
What Are the Potential Benefits of a Business Credit Card?
Business credit card benefits may help contribute to your business growth and help improve operational efficiency. These benefits might include employee card controls, expense management tools, and flexibility in spending limits.
1. Streamline Your Business Expenses
Business credit cards may offer tools to help you track and manage your business expenses easily so you can help streamline the reporting process. Some cards may automatically sort your transactions into expense categories and integrate with accounting software. Your card could also help you customize spend controls to monitor expenses in order to align with the needs of your business.
Being able to get a clear snapshot of business expenses may help you identify unwanted spending and make more strategic decisions to potentially help further improve cash flow.
2. Potential Access to Additional Credit and Flexibility
Potential access to additional credit may provide more spending power when you need resources to help invest in growth or if your business has variable needs depending on the time of year.
However, you may consider balancing the benefits of potential access to additional credit with your strategic goals. Aside from regularly reviewing spending based on revenue and needs, you might consider paying off balances to avoid interest charges. Other strategies could include implementing stricter spending approval processes and regularly monitoring accounting software to track on-time payments.
For example, say your business has seen a surge in demand for certain products and you’re ready to help invest to help keep up with sales. You could use your business credit card to purchase shelving and inventory. Then you could track any additional revenue from the sales of the new inventory and consider using it to help pay any balance on your card.
3. Earn Cash Back Rewards
Business cash back credit cards could allow you to earn cash back on your purchase amount. You may be able to earn different cash back rates across different spending categories, with some earning more than others. You may also be able to earn a percentage of cash back up to a certain amount per year, and a smaller percentage thereafter.
Some categories that offer bonus cash back rewards may include travel and office supplies. These bonus categories may be on a rotating basis and you may need to opt into them.
4. Enjoy Business Travel Benefits
Business credit cards may also offer other types of benefits, including travel-related services. These might include airport lounge access, travel and car rental insurance, and access to concierge services. These benefits could help you reduce costs and provide incentives for employees who travel regularly for the business.
5. Enhanced Control With Employee Cards
Issuing credit cards to employees could help your business better track spending and reporting, potentially allowing for enhanced control over finances. Features you may find helpful for managing expenses could include limiting purchase categories, setting spending limits, and monitoring employee transactions in real-time.
Employee credit cards could also help improve operations as you may not need to reimburse employees for expenses. Employees could then potentially make purchases or book services without delays or the need for additional paperwork.
Benefits and Risks of Business Credit Cards
Although business credit cards may offer helpful features, they also have benefits and risks.
Potential benefits of business credit cards may include:
- Earning cash back or travel rewards
- Tracking business transactions seamlessly
- Accessing more flexibility in spending
- Streamlining spending with employee credit cards
Potential risks of business credit cards may include:
- The potential to overspend
- The risk of an employee misusing a card
Choosing a Business Credit Card
Choosing a business credit card could enhance the way you do business. Consider the features that matter to your business, whether that’s the ability to issue employee credit cards or better track spending. Businesses interested in rewards may decide whether receiving cash back or travel perks are better suited for their needs.
As you consider different cards, consider the requirements and the application process. Learn about some of the key criteria issuers look for.
Consider the American Express Graphite™ Business Cash Unlimited Card
The new Graphite™ Business Cash Unlimited Card is designed to help you get business done with straightforward cash back1, flexible cash flow features and access to American Express financial tools and solutions. Cash back is received in the form of Reward Dollars that can be redeemed as a statement credit. Terms apply. Discover how this Card can support your evolving business needs. Card Members can earn unlimited 2% cash back on eligible purchases. There are no caps or categories. Cash back is received in the form of Reward Dollars that can be redeemed for a statement credit or at Amazon.com checkout.
Benefits of Business Credit Cards FAQ
What are the potential benefits of a cash back credit card?
The benefits of using a cash back credit card may include earning rewards on qualifying purchases.
How can businesses benefit from cash back?
Businesses may directly benefit from a cash back credit card by earning rewards on specific items and services, allowing your business to potentially make new investments or pay other expenses.
What are the benefits of a business credit card?
The benefits of a business credit card may include the ability to track spending more easily and help streamline your expense approval process.
What are the potential advantages of a business credit card?
The advantages of a business credit card might include the ability to earn rewards and the option to help streamline expense management.
What are the potential disadvantages of a business credit card?
Some potential disadvantages of a business credit card might include the potential to overspend and the risk of an employee misusing a card.
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Terms and Conditions
1. Basic Card Members will earn Reward Dollars (Reward Dollars) for eligible purchases on their Graphite™ Business Cash Unlimited Card (Card Account). The number of Reward Dollars earned is based on a percentage of the dollar amount of their eligible purchases during each billing period. Basic Card Members will earn a reward of 2% on all eligible purchases. Eligible purchases are purchases for goods and services minus returns and other credits. Eligible purchases do NOT include fees or interest charges, purchases of travelers checks, purchases or reloading of prepaid cards, or purchases of other cash equivalents, gift cards, or person-to-person transactions, or any portion of a purchase that is covered by Reward Dollars at point of sale. Basic Card Members can redeem Reward Dollars for statement credits or for eligible items at Amazon.com checkout, with no minimum redemption amount. Basic Card Members cannot use cash back to pay their New Balance (or Minimum Payment Due or Amount Due, if applicable) on their most recent billing statement. Statement credits, or any reversals of a statement credit, may be applied to either their Pay Over Time balance or Pay In Full balance, at our discretion. The Basic Card Member must link their Card Account to their Amazon.com account in order to use Reward Dollars at Amazon.com. When a Basic Card Member uses Reward Dollars at Amazon.com, we will charge their Card Account for the purchase, deduct the Reward Dollars from the available Reward Dollars on their Card Account, and apply a credit to their Card Account to reflect the Reward Dollars used. In addition to these Terms and Conditions, the terms and conditions for Shop with Points at Amazon.com apply to eligible purchases made with Reward Dollars at Amazon.com.
