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Beginning February 2019, Brex has started issuing World Elite Mastercards for all our customers. With this new program, all Brex cards will include additional fraud and purchase protections, as well as enhanced travel benefits (e.g. travel and rental car insurance). Learn more here.
Brex is a corporate charge card accepted worldwide on the Mastercard network, and it’s designed to make startups’ and early-stage companies’ lives easier. The card links to your business’ corporate bank account and underwrites your credit limit based on your company’s cash assets — and there’s no personal liability. Built-in features include receipt capture and the ability to link your accounting software to Brex.
Today, the unique charge card is announcing a new rewards program. The aptly named Brex Exclusive program offers customers up to 7 points per dollar spent along with discounts and credit at participating vendors.
Brex is a charge card underwritten on business credit using an EIN (employer identification number) during the application process. Brex advertises instant sign-up, with no personal guarantees, credit checks or security deposits required.
For the application process, you must link your business bank account to Brex, and it analyzes your business data in order to make an approval decision and set your spend limit. If you are approved, you will be given a virtual card instantly to begin using, with the physical card showing up 3-5 business days later. There is a list of prohibited and restricted activities, such as gambling, that cannot use Brex.
Your Brex account must remain linked to a business bank account where automatic payments for the balance in full are made at the end of every 30-day statement period. There is no annual fee and no foreign transaction fee, and your first five cards for yourself and four employees are also included at no fee. You can set spending limits on employee cards, a nice feature many business cards are neglecting.
Brex Exclusive Rewards
Starting today, businesses that use Brex exclusively as their corporate card qualify for the new Brex Exclusive Rewards. Here is the new program’s basic earning and redemption structure:
Brex is not offering a traditional sign-up bonus of cash or bonus points, but is offering deals and credit at startup-specific partners. Here is a sampling of what is available to cardholders:
Amazon Web Services — $5,000 in AWS credits to be used over a year. The offer is only available to startups that have previously received fewer than $5,000 AWS credits through AWS, a VC accelerator, or other AWS-partnered organization.
Salesforce — $375 off an annual Salesforce subscription with a 25% subscription discount.
WeWork — 15% discount off of the list price for any new WeWork desk or office space for up to 6 months across all US locations (average of $5,000 in value for a typical office space)
- 7x on ride shares and taxis
- 4x on travel booked through the Brex travel portal
- 3x on restaurants
- 2x on recurring software/SAAS — Brex created this category which is apparently only trackable with Brex technology
- 1x on all other spend
Points are worth a flat 1 cent each no matter how you use them and can be redeemed as a statement credit against a transaction made with your card or toward new travel booked through the Brex travel portal.
We asked Brex how they would know if it was being used exclusively by a business and received the following statement:
“Brex uses its existing customer base and third-party data to establish an expected spending profile for a given company, and review accounts periodically based on anticipated spending patterns found in similarly positioned companies. We also rely on features of the Brex platform including higher company limits, user controls, instant card issuance, and embedded expense management to drive exclusivity.”
Based on that response, I don’t foresee anyone being excluded from the new rewards program, even if you are using another card, but I wouldn’t push it. The hope is you experience Brex and the new rewards program which lure you into making Brex exclusive in your business.
How Competitive Is Brex Exclusive Rewards?
Brex has a taken a different angle on the typical business card rewards program. The sign-up bonus of merchant credits and discounts will be attractive to a very specific type of company — specifically, startups and other early-stage businesses — and can yield potentially large value for these users.
The bonus spend categories are competitive, but are they the best? Brex argues in its comparative analysis that because a typical customer is a corporation, points are unlikely to be transferred or redeemed for other travel services. That means it values other transferable points currencies (Amex, Chase) at the same 1 cent per point as its own Brex currency. Of course, TPG’s valuations peg these transferable points much higher than that, but Brex says its customer base of startups is more interested in getting value back to the business than transferring points to travel partners. If you use your card primarily for cash-back, as Brex suggests many of its customers do, Brex has a solid offer.
The multipliers Brex offers are competitive — 7% cash back on ride shares and taxis is the best I’ve seen, even when accounting for the value of transferable currencies. 3% back on travel and restaurants and 2% back on software and SaaS is also competitive, but not the best. There are other transferable points-earning cards whose value come out on top in terms of multipliers and bonus categories. You could come out ahead with the Bank of America Premium Rewards credit card if you have Platinum Honors status in Bank of America’s Preferred Rewards program. You’ll earn a minimum of 2.625% cash back on all spend and 3.5% cash back on dining and travel.
Meanwhile, the Ink Business Preferred Credit Card from Chase offers 3x points on travel, shipping, internet, cable and phone as well as social media advertising and search engines, on the first $150,000 spent in combined purchases each year. While not a direct cross over in what Brex offers, it is pretty close. With Chase points worth (much) more than 1 cent apiece when you transfer to partners or book travel directly through Chase for 1.25 cents each, you’ll most likely come out ahead with the Ink Preferred if you’re a customer that uses points in that way. But again, Brex touts its lack of a cap on its 7%, 3% and 3% multipliers, and argues that travel redemptions aren’t the top priority for its target customer base — so if you are a startup that cares more about cash-back, you may be better off with Brex.
There’s a specific type of business — a startup or early-stage company — that could and should benefit from what Brex offers. If you struggle with expense reports and accounting and need to make that area more efficient, Brex has the tools to take some stress off your plate. And the underwriting model, with no personal liability, could be ideal for young businesses. The good news is you’ll now also benefit from a competitive rewards program and have cash back in your pocket at the end of each month.
If you can benefit from some of the lucrative partner offers, it should make your decision easy. If you’re a more traditional business and not a technology startup and want to maximize your rewards for travel, though, there are better products to choose for your corporate card.
Featured photo by Hunters Race/Unsplash
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