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Discover Launches New Business Credit Card With First Year Cash Back Match

Sept. 12, 2018
5 min read
Discover Launches New Business Credit Card With First Year Cash Back Match
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This page includes information about the Discover it Business Card that is not currently available on The Points Guy and may be out of date.

Several years after it stopped issuing business credit cards, Discover is back in the small business game. On Wednesday, the issuer launched the Discover it Business Card, which is now available for applications at Discover's website. In lieu of a welcome bonus, the card comes with the issuer's familiar match of all the cash back you earn during the first year of card ownership. That match offsets the card's fairly pedestrian earning rate and turns it into a particularly powerful cash-back card during year one.

Here's a look at the key features of the Discover it Business Card:

As mentioned earlier, the card doesn't come with a traditional sign-up bonus — instead, Discover will automatically match all the cash back you've earned at the end of your first year with no limit on the amount earned. That effectively makes this a 3% cash-back card on all purchases for the first year of ownership, which is a market-leading return for either a business or personal card.

According to Discover, its business customers demanded a simple rewards program that offers users the same cash-back rate on all transactions, rather than a program that offers bonus categories on business spending. Cash back on the Discover it Business card can be redeemed in any amount as a statement credit, an electronic deposit to your bank account or a donation to select charities. You can also redeem cash back for gift cards starting at $20.

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Along with cash-back rewards, this card comes with several other benefits, including:

  • Free employee credit cards
  • Social Security number alerts, which tell cardholders when their SSN has been spotted on "any of thousands of risky websites"
  • Free FICO scores
  • $0 fraud liability guarantee
  • Freeze it protection, which allows cardmembers to instantly prevent new purchases, cash advances and balance transfers via the Discover app or website
  • Free first late payment

You can create custom spending limits for each employee — ranging from $1 up to the card limit — and each employee card also earns rewards for the business owner. Discover limits the number of authorized user employee cards to five, so this card really is tailored to small businesses.

To aid with bookkeeping, Discover says you can get itemized reports for each employee card. The issuer also has made it easy for business owners to download transactions directly into QuickBooks, Quicken and Excel, and provides both quarterly reports and annual statements to help with filing taxes.

When you apply for the Discover it Business Card, you authorize the issuer to obtain both consumer and business credit reports. This is not unusual. Discover says it also reports your business credit card activity to the three major business credit bureaus, which, if you responsibly use and pay off your card, could help you build business credit.

Comparing First-Year Earning

When it comes to business cards, the Discover it Business compares most directly to the Capital One® Spark® Cash for Business, which offers 2% cash back on all spending and a $500 cash bonus once you spend $4,500 on purchases within three months from account opening. When including the welcome bonus, the first-year value of the Spark Cash is about 3.6% for the average household, dropping to about 1.7% in subsequent years with the $95 annual fee.

Other premium business credit cards also offer more value on paper in the first year, including the Ink Business Preferred Credit Card (7.3%), the Business Platinum Card® from American Express (7.0%) and the Ink Business Cash Credit Card (6.1% when paired with a card that earns Ultimate Rewards). What puts those cards over the top are the large welcome bonuses and ability to wring more value out of them when you transfer points to travel partners. However, to truly get these kind of returns, you'd need to take the time to learn how to maximize the points, as well as have the flexibility in your travel schedule to make restricted award space work.

But unlike points, cash back is cash back — it's easy to redeem and endlessly flexible. So if you're looking for a simple business card with a strong everyday cash back return and no bonus categories to worry about, you may want to give the new Discover it Business card a good look.