A credit card is a very important toll for a business to have. If a business decides they do want to get a credit card, a cash back business credit card would be a great choice. With a cash back card, the business can have a credit card for business purchases and earn cash that can then be used to benefit the business.
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How does a cash back business credit card work?
This type of credit card gives a certain amount of money back to the cardholder for every qualifying purchase they make. Certain purchases may earn more money back than others may. Most of these cards let the cardholder earn this money by percentage. Others use the rewards point method where a certain number of points equal a monetary amount.
The cash earned with these credit cards can be viewed as a refund of sorts. This money is given back to the cardholder either as a credit to their credit card account or through a check mailed directly to the business. A minimum amount of money has to be earned before the refund is issued.
What are the benefits of having a cash back business credit card?
There are benefits to both refund methods. If the cardholder receives their refund as a credit to their account, it instantly reduces the credit card’s balance. A reduced credit card balance equals a lower monthly payment. If there is no balance on the credit card when the credit is issued then it gives the cardholder a certain amount of money, they can spend on their card that they never have to pay back.
Most people prefer to have a cash back credit card that sends their refund directly to them in check form. While having a balance reduced by a credit is nice, most would rather have the money in their hand so they can spend it however, they wish. This is particularly true in a business situation.
Businesses benefit greatly from these cash back credit cards because they are able to take the money they earned and reinvest it in the business. If they receive their refund as a credit, it takes some of the worry away from their credit card debt. If they receive their refund by check, they are able to use that money to make purchases for the business or apply it to other debt the company has. Either way having extra cash is not something a business would be willing to turn down.
What are some leading cash back business credit cards?
Two of the more popular cash back business credit cards is the Ink Cash Business credit card from Chase and the Spark Cash Select for Business credit card from Capital One. Both of these cards would be a great tool for any business and are provided by very well respected credit card providers.
The Ink Cash Business credit card from chase offers an introductory annual percentage rate of zero percent for the first six months of the account. This zero percent rate also applies to balance transfers. One the introductory period has expired the annual percentage rate will be between 13.24% and 19.24%. The regular interest rate is ultimately determined by the business’ credit score.
This card lets the business earn 5% cash back on the first $25,000 dollars they spend each year on cable services, office supplies, and telecommunication services. The company can also earn 2% cash back on the first $25,000 it spends each year on dining and gas expenses. The company will earn 1% cash back on all of their other purchases throughout the year with no limit to how much they can earn. The cash rewards with this card never expire.
The Spark Cash Select for Business credit card also has a zero percent interest rate for the first six months that also applies to balance transfers. The regular annual percentage rate is a little higher at 14.9% to 19.9%.
A business owner with this credit card will earn 1% cash back on all of their purchases with no limit. They will also get a 50% bonus on the cash they earn back every year.
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