Business Credit Card Selection

Business credit cards are the go-to replacement for business loans these days, but which credit card is right for your business?

American Express® Cards For Established Canadian Businesses Great Card Offers - Learn More Now

By Lisa Pembrooke


With the slow economy, I've heard that banks are making it tough to borrow money. Should I even consider applying for a small business loan for my start-up? ¬-- M.J., Grand Rapids

If you've applied for a small business loan lately, you already know the answer to that question. With the current recession, it's no small feat to convince a bank that you're worthy of even a small loan amount. The banks are playing it safe and are slow to lend out money even to qualified individuals, so many entrepreneurs are looking for an alternative to jumping through hoops and playing the waiting game with the banks. Business credit cards can be a great alternative if you have established credit cards with a good credit score and make regular payments on time.


Having a solid credit rating is the best way to increase your odds of being approved for a business credit card. You can also amplify your odds by applying for the business credit card at a bank where you have already established a great reputation. The added trust of being a current customer in good standing will cause the bank to see the application for a business credit card in a much more favorable light.



The main considerations before committing to a specific business credit card are the following:

  • Interest rate
  • Annual fees
  • Rewards

The interest rate is tacked on to every single purchase you make when you carry a balance, so it's important to get the lowest one possible. Some cards may begin with a low introductory rate and gradually increase it over time. It's recommended that you find a card with a hard cap on interest rates to protect you from costly increases down the road.

While the annual fees aren't quite as important as the overall interest, they are worth comparing. Some cards with lower interest rates may charge a higher annual rate, or vice versa. Do the math and establish that the savings you gain by a lower interest rate at the very least offset the annual costs for the card.

Lastly, the rewards offered by certain cards may be the tiebreaker in the case of not being to decide between two different business credit cards. You may earn points every time you use your credit card to make a purchase, or you may be given rewards points for maintaining a good credit rating. Rewards may include discounts or cash back on purchases, including travel fares, which can make an impact on your business's bottom line.


For the longest time business credit cards didn't offer any rewards at all, but as rewards programs gained momentum with personal credit cards, the business version soon followed suit. Here are a few of the ways that various business credit cards reward the cardholder.

  • Frequent Flier Programs: These programs help business owners to gain additional leverage for money that they already need to spend on travel. With use, the points accumulate and allow for free business travel in the future; some companies even choose to extend free trips to their employees as a reward or bonus for their hard work.
  • Cash-Back Rewards: Credit cards like the Blue Cash for Business card from American Express allow up to 5 percent cash back on all purchases made with the card. Depending on how much money you spend in your business, the cash back can add up very fast. Again, businesses can choose to reinvest this money back into the business or their staff.
  • Co-Branded Business Credit Cards: These cards are offered by companies like Amazon and GM and include benefits like free merchandise or discounts based on the amount of use. The GM card can amount to significant savings on company vehicles since the earnings are restricted and don't expire.

The American Express (AXP) small business card gets high marks from many leading money authorities because of its ample rewards program. While many cards typically offer only a single point for each dollar spent, American Express provides opportunities to get multiple points per dollar through specific promotions. Not only does this mean more rewards for the money, but also that they'll accumulate much faster.


Getting a maximum cap on the amount of interest is important because the recent Credit Card Accountability Responsibility & Disclosure Act only protects personal credit card accounts and not business credit cards. This means that interest rates could change dramatically for business credit card holders with very little notice, while changes like these to personal credit cards would be illegal under the act. Until similar protection is offered to small businesses, it's up to business owners to be smart about which card they choose.

American Express® Cards For Established Canadian Businesses Great Card Offers - Learn More Now