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10 considerations for your small business credit card strategy

May 02, 2022
16 min read
Small business owner hands card back to customer.
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Owning a small business can present lucrative opportunities for maximizing credit card rewards. It can also present unique challenges because much of the information surrounding travel credit cards focused on personal options rather than those geared toward businesses.

As part of National Small Business Week, we wanted to take a close look at credit card strategies for small business owners looking to maximize rewards.

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Here are 10 things for you to consider as you build a strategy to maximize rewards from your business spending.

Look at where your business spends the most

(Photo by stevecoleimages/Getty Images)

Before any other tip, you need a good understanding of your business' spending — not just how much you spend but where you spend it.

Start by looking at your business' spending and the relevant Merchant Category Codes (warning: PDF link) to see where you can maximize your spending to earn more points on every dollar. Then, check the earnings from the credit card you're currently using for business expenses; can another card do better?

If your business spends a lot on shipping products, you want a card that earns extra points here. If you own a restaurant and consistently make grocery purchases, chances are that the best card for your business will be different.

After analyzing where you spend the most, look for cards that earn bonus points or miles in these categories. You could even consider applying for the best card for each of your regular spending categories, as that will allow you to maximize all of your transactions.

Luckily, there are cards that adapt to your business' spending habits, as well.

For example, the American Express® Business Gold Card offers 4 points per dollar in the two categories where your business spends the most each billing cycle — up to $150,000 in combined spending per year (then 1 point per dollar).

Meanwhile, the Bank of America® Business Advantage Customized Cash Rewards Mastercard® credit card offers 3% cash back on the category of your choice along with 2% back at restaurants on the first $50,000 in combined spending each year (then 1%). You can also boost your earnings here if you're a member of the Bank of America Preferred Rewards program.

Lastly, consider the U.S. Bank Business Leverage® Visa Signature® Card. It offers 2% cash back in the top two categories where you spend the most each month with no caps — and like the Amex Business Gold card, it automatically adjusts to your spending habits.

Consider whether elite status matters to you

Spending your way toward elite status is possible in multiple airline and hotel loyalty programs. Depending on the program, you can either boost your progress or spend your way toward status outright without ever leaving home. If you have a small business through which you can put significant spending on a cobranded credit card, this could be a great opportunity to also gain elite status in a program you enjoy.

If you're interested in airline elite status, consider American Airlines and Delta Air Lines. With American's shift to Loyalty Points, you can swipe your way to elite status by earning 1 Loyalty Point for ever $1 spent on a range of American Airlines credit cards.

In a similar vein, Delta offers bonus Medallion Qualification Miles (MQMs) toward status on two of its business credit cards. The Delta SkyMiles® Platinum Business American Express Card offers 10,000 bonus MQMs after spending $25,000 — up to two times — on the card in a calendar year. Meanwhile, the Delta SkyMiles® Reserve Business American Express Card offers 15,000 bonus MQMs after you spend $30,000 on the card each calendar year — up to four times. And both cards offer the ability to hit Medallion Qualification Dollar (MQD) waivers, all of which can help your progress toward Delta status.

For hotels, the Marriott Bonvoy Business® American Express® Card offers complimentary Gold Elite status with Marriott Bonvoy.

If you're more of a Hilton fan, the Hilton Honors American Express Business Card offers complimentary Gold status, but if you spend $40,000 or more on the card in a calendar year, you'll unlock top-tier Diamond status.

As you evaluate this decision, consider what this status is worth to you, and compare it to the sections above to ensure you're earning the most rewards on each purchase. Everyone's situation is different, so you'll need to decide which is the most valuable option for your business' spending habits.

Build an arsenal of cards that complement each other

(Photo by Fairfax Media via Getty Images)

If your business spends broadly across numerous categories, then you should consider a card with bonus earnings in multiple categories that apply to your situation — or, you could apply for multiple cards that complement one another.

If you spend across social media advertising, shipping, wireless services and other categories not all found on the same credit card, then look for cards that earn well in those categories. Choose the card that earns the most rewards on that spending category and set it as your preferred payment method with the relevant vendor(s).

Taking time to set a preferred credit card for payment with different vendors can help you earn the maximum rewards on each purchase. It also avoids the situation where you or an employee can't remember which card to use and choose the wrong one — possibly missing out on thousands of points.

Be careful with business spending on personal cards

Personal credit cards can have some excellent features: big sign-up bonuses, elite status with your preferred hotel or even extra rewards in a category where your business spends regularly. There's nothing inherently wrong with using a personal credit card on these purchases. However, you should be wary of what a large balance on your card's monthly statement can mean for your credit score.

A full 30% of your credit score is based on your credit utilization — which is a reflection of how much you owe compared to your total available line of credit. For example, if you have a single credit card with a limit of $10,000 and a balance of $1,000 on that card, then your utilization is 10%.

If you are regularly putting large business purchases on personal credit cards, those balances will reflect on your personal credit report and have the potential to drive your score down. However, most business credit cards won't show up on your personal credit report, so large purchases on these cards shouldn't affect your personal credit score.

Related: Do business credit cards impact my credit score?

Crunch the numbers to justify an annual fee

(Photo by TONY KARUMBA/AFP via Getty Images)

Seeing cards with elevated earning rates is enticing. However, they usually come with a higher fee. Doing some math can help you find the best card for your business.

Two small business credit cards from Capital One provide a great example here. The Capital One Spark Miles for Business has an introductory annual fee of $0 and then $95 thereafter. This card earns unlimited 2 Capital One miles per dollar. The Capital One Spark Miles Select for Business has no annual fee each year and earns unlimited 1.5 miles on every dollar.

The information for the Capital One Spark Miles Select for Business has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

On paper, you may think that it's obvious to go for the card that earns 2 miles per dollar, but it depends on how much you're spending on the card each year.

In short, you want to find the "break-even point" where you're earning enough extra miles to offset the annual fee.

The calculation works like this:

Annual fee ÷ Value of additional rewards per dollar spent (expressed as a decimal) = Total spending to break even

In this example, TPG values Capital One miles at 1.85 cents each, and you're earning an additional 0.5 miles for every dollar you spend. In other words, every dollar you spend gets you an additional 0.925 cents in value.

So, when you plug these numbers into the above formula ($95 ÷ 0.00925), you get $10,270.

This means that, if you'll spend more than $10,270 on your card in a year, the extra rewards you earn on the Spark Miles for Business will more than justify the $95 annual fee.

You should follow this example whenever you're choosing between two credit cards and want to apply for just one of them. If there is a higher annual fee on one of the cards, evaluate just how much you need to spend to earn rewards that offset that annual fee. If you don't think you will meet that spending threshold, then a card with a lower earning rate and a lower annual fee will be best for you.

Understand the rules and restrictions

With personal credit cards, we are accustomed to seeing explicit rules like this:

"You cannot earn a new cardmember bonus on this card if you have applied for or earned a bonus on this card in the past 24 months."

I can't count how many times I've heard people cite this rule for the Chase Ink family of business credit cards. However, there's no such rule.

For business owners with multiple ventures, you may want to keep your spending separate, so having a different credit card for each one may make sense. If that's you, you'll be happy to know that there's no restriction on earning another welcome bonus on cards like the Ink Business Preferred Credit Card, Ink Business Cash Credit Card and Ink Business Unlimited Credit Card. The fact these cards have different bonus earning categories can also help you maximize your earnings.

There are obviously other application rules at play, but don't be fooled by the common repetition of this nonexistent 24-month rule on Ink credit cards.

Go for big bonuses as a big spender

(Photo credit should read BAY ISMOYO/AFP/Getty Images)

Different businesses spend different amounts of money. Not every business owner can meet the requirements for huge bonuses, and there's nothing wrong with that. However, if you can, try to grab them when they roll around.

Earlier this year, we saw a massive welcome offer of $3,000 in cash back (no longer available) on the Capital One Spark Cash Plus, which required two spending tiers. You could earn $500 after spending $5,000 in the first three months and another $2,500 back after spending a total of $50,000 in the first six months of card membership.

(Note that his offer is no longer available; new applicants can now earn up to a $1,000 cash bonus; $500 once you spend $5,000 in the first three months, and $500 once you spend $50,000 in the first six months of account opening.)

Earning $3,000 on $50,000 of spending is a 6% return, a significant amount.

However, not every small business can spend $50,000 in six months, which leads some business owners to pass on these types of offers. If you're fortunate enough to have a business with large spending power, keep your eyes out for bonuses with big payouts after high spending.

Related: Cards currently offering sign-up bonuses of 100,000 points or more

This also applies to banks with cash bonuses for new business checking accounts after completing certain activities. The more lucrative bonuses typically require more spending or larger deposits into the new account. Leverage the high spending power of your business if this applies to you.

Use the right card for large purchases

While we spend a lot of time talking about using the best credit card in various categories, in order to maximize spending categories, we don't spend as much time talking about the fact some credit cards offer bonus points and miles on large purchases.

For instance, The Business Platinum Card® from American Express offers 1.5 Membership Rewards points per dollar on purchases of $5,000 or more (on up to $2 million in purchases each calendar year). Similarly, the Chase Ink Business Premier offers unlimited 2% cash back on everyday spending, but that rate goes up to 2.5% cash back on purchases of $5,000 or more.

Related: The top 6 credit cards to maximize large purchases

Aside from elevated earning rates on cards you already have, consider applying for a new credit card if your business has big spending on the horizon. That could be a great opportunity to meet the spending requirements for a new card welcome bonus, yielding much more than 2-3% back on your spending.

The information for the Ink Business Premier has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Watch for bonuses to add employee cards

(Photo by 5byseven via Twenty20)

American Express routinely has offers to add authorized users on personal cards and employee cards on business accounts. Taking advantage of these offers can net hundreds of thousands of bonus points.

Just note that there are limits to how many employee cards you can add to an account, and not everyone is targeted for these offers. In addition, there are usually spending requirements attached to these offers, and these are usually 'per card', meaning you must meet the spending requirement on each individual employee card to earn the relevant bonus.

In the past year, we have also seen a big increase in welcome offers that have bonuses for adding and using employee cards. You may see a welcome offer like "Earn x points after spending $5,000 in your first three months of card membership. Earn another x points when you add an employee card and spend at least $1,000 on it in the first three months." Note that these types of offers are targeted, so not everyone will see the same offers.

If there are other employees who make purchases for your business, adding them strategically can greatly add to your points and miles balances. Just remember that you're still responsible for all spending on the account.

Be sure to use your cards' benefits

This tip applies to all credit cards — business and personal. If your card has an annual fee and you aren't using the perks and benefits, then you probably shouldn't be paying that annual fee.

Be sure to use benefits like the cellphone protection on the Ink Business Preferred Credit Card and the $10 in monthly wireless credits from the Business Platinum Card. The Business Platinum also has hundreds of dollars in annual credits with Dell, Indeed and Adobe that you can use each year.*

Meanwhile, the U.S. Bank Business Triple Cash Rewards World Elite™ Mastercard® has up to $100 in annual statement credits toward monthly software service purchases like FreshBooks or QuickBooks.

Look at the benefits your card offers and look for ways to maximize them. If you can't do that, look at the value you are getting out of these benefits to determine whether they offset the card's annual fee (if there is one). If you aren't getting more value than the annual fee, and if the rewards you're earning from that card could be replicated with another card, then you could probably close this credit card to save money each year.

*Enrollment required for select benefits.

Bottom line

(Photo by PeopleImages/Getty Images)

Small business owners are in a unique position to maximize points and miles earnings. Not every business spends the same amount of money, but these are the main elements you should consider as you build a credit card strategy to make the most of your rewards.

A good strategy for your business credit cards should complement your personal credit card strategy, as well. A good example is how holding a business and personal Marriott credit card can help you earn status each year. If you pair your business and personal credit card strategies well, it can really increase your earnings.

If nothing else, you should understand your business' spending amounts and categories to know what bonuses are within your reach and to use the right credit cards to maximize each purchase as much as possible.

Featured image by Getty Images
Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards

1 - 3X points
3XEarn 3 Points per $1 spent at Restaurants and Supermarkets
3XEarn 3 Points per $1 spent at Gas Stations, Air Travel and Hotels
1XEarn 1 Point per $1 spent on all other purchases

Intro offer

Earn 80,000 ThankYou® points60,000 points
For a limited time, earn 80,000 bonus ThankYou® Points after you spend $4,000 in purchases within the first 3 months of account opening

Annual Fee

$95

Recommended Credit

670-850
Excellent, Good
Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Why We Chose It

The Citi Premier’s 3 points per dollar spent across a wide range of popular categories is one of the more lucrative offerings in the world of points and miles. The Citi Premier comes with a $95 annual fee and is currently offering a solid sign up bonus of 80,000 points after you spend $4,000 on purchases within the first three months. It also has some valuable transfer partners to make the most of your rewards. Add in access to Citi Entertainment plus a $100 hotel credit for any single-stay hotel booking that exceeds $500 or more, excluding taxes and fees, booked through the Citi travel website, there are few reasons why the Citi Premier should not be in every traveler’s wallet.

Pros

  • Earns 3x points on restaurants, supermarkets, gas stations, air travel and hotels.
  • $100 annual hotel savings benefit (on single hotel stay bookings of $500 or more, excluding taxes and fees, booked through thankyou.com)
  • Points transfer to 16 airline programs, from JetBlue to Virgin Atlantic.
  • World Elite Mastercard benefits, extended warranty, damage and theft protection.

Cons

  • $95 annual fee
  • Lacks travel protections that other travel rewards cards come with
  • For a limited time, earn 80,000 bonus ThankYou® Points after you spend $4,000 in purchases within the first 3 months of account opening
  • Earn 3 Points per $1 spent at Restaurants and Supermarkets
  • Earn 3 Points per $1 spent at Gas Stations, Air Travel and Hotels
  • Earn 1 Point per $1 spent on all other purchases
  • Annual Hotel Savings Benefit
  • 80,000 Points are redeemable for $800 in gift cards when redeemed at thankyou.com
  • No expiration and no limit to the amount of points you can earn with this card
  • No Foreign Transaction Fees on purchases
Best starter travel card
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

3XEarn 3 Points per $1 spent at Restaurants and Supermarkets
3XEarn 3 Points per $1 spent at Gas Stations, Air Travel and Hotels
1XEarn 1 Point per $1 spent on all other purchases
  • Intro Offer
    For a limited time, earn 80,000 bonus ThankYou® Points after you spend $4,000 in purchases within the first 3 months of account opening

    Earn 80,000 ThankYou® points
    60,000 points
  • Annual Fee

    $95
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    670-850
    Excellent, Good

Why We Chose It

The Citi Premier’s 3 points per dollar spent across a wide range of popular categories is one of the more lucrative offerings in the world of points and miles. The Citi Premier comes with a $95 annual fee and is currently offering a solid sign up bonus of 80,000 points after you spend $4,000 on purchases within the first three months. It also has some valuable transfer partners to make the most of your rewards. Add in access to Citi Entertainment plus a $100 hotel credit for any single-stay hotel booking that exceeds $500 or more, excluding taxes and fees, booked through the Citi travel website, there are few reasons why the Citi Premier should not be in every traveler’s wallet.

Pros

  • Earns 3x points on restaurants, supermarkets, gas stations, air travel and hotels.
  • $100 annual hotel savings benefit (on single hotel stay bookings of $500 or more, excluding taxes and fees, booked through thankyou.com)
  • Points transfer to 16 airline programs, from JetBlue to Virgin Atlantic.
  • World Elite Mastercard benefits, extended warranty, damage and theft protection.

Cons

  • $95 annual fee
  • Lacks travel protections that other travel rewards cards come with
  • For a limited time, earn 80,000 bonus ThankYou® Points after you spend $4,000 in purchases within the first 3 months of account opening
  • Earn 3 Points per $1 spent at Restaurants and Supermarkets
  • Earn 3 Points per $1 spent at Gas Stations, Air Travel and Hotels
  • Earn 1 Point per $1 spent on all other purchases
  • Annual Hotel Savings Benefit
  • 80,000 Points are redeemable for $800 in gift cards when redeemed at thankyou.com
  • No expiration and no limit to the amount of points you can earn with this card
  • No Foreign Transaction Fees on purchases