Business Credit Card Reward Comparison Guide
These days, there are dozens of business cards available, each with its own rewards system. The sheer variety of options makes it difficult to determine what's the best card for your organization.
To help you find the right card for your business, here’s a credit card reward comparison guide of the various reward programs available.
Below we’ll discuss:
- How business credit card rewards work
- Considerations of top reward programs
- The top credit cards available, ranked by best rewards
How Business Credit Card Rewards Work
As with most lines of credit, there are dozens of entities competing for your attention. To stand out from one another, these entities use their business credit card’s rewards program as the primary distinguisher.
On the surface, how they work is simple: for every dollar spent, your credit card provides some type of small return. But because there are so many reward redemption options to choose from, it’s helpful to compare and contrast them by first breaking down the cards into reward subcategories:
- Points – A common type of card reward system—when the business spends money, they receive a certain number of points back. Depending on the card, certain purchases such as dining or hotel stays may provide more points than other types of expenses. Over time, the points accrue and can be spent on a catalog of items. It’s important to note, however, each credit card program has its own definition of points and the relative value of points to dollars, which adds to the confusion.
- Miles – This travel rewards card is more suited for businesses that travel frequently. All travel rewards come in the form of miles that can be redeemed on future travel plans. The card issuer of the travel credit card tends to offer bonus miles for travel categories like gas, car rentals, or hotel bookings.
- Cash back – The simplest of the options, with a cash rewards system the card issuer guarantees a specific percentage of dollars spent will be automatically credited back to your account from everyday purchases. Cash back on credit cards is the most straightforward rewards program. Many businesses prefer a cash rewards plan to the hassle of gaming the points or miles systems.
A note on incentivized spending: The harshest critique of both points and miles rewards programs is the more you spend, the more reward points you win. Additionally, there’s often no straightforward way to understand the monetary value of points and the requirements for redemption. A cash back card opposes this model by ignoring how much you spend and offering you value regardless.
Considerations of Top Reward Programs
In addition to the type of rewards program the secured card issuer provides, there are other factors that you need to think about when selecting a business credit card, including:
- Redemption window – Certain reward systems (typically those with points or miles) often have limits to when an item can be redeemed. Or, they may come with an expiration date, which forces you to use the points or lose them. This can incentivize you to make purchases that you may not need simply so you are able to use your rewards.
- Signup bonus – Some business cards come with an instant bonus for signing up, whether it’s an initial 50,000 points or miles or free travel rewards for a given amount spent in the first few months.
- Redeeming points – How you redeem your reward points depends on the rewards credit card, but often it involves a convoluted process that can only be done through the card’s website. This means you always have to be on top of your rewards, checking the website for purchases you’d like to spend the points on and for what you can redeem the points on. Your preferred vendors may not be an option.
- Partner programs – Cards will partner with other businesses to provide discounts or reward multipliers when you use a certain vendor.
Again, these factors will often cause more hassle than they’re worth. This is why many opt for a straight cash back card system, which simplifies the process and puts cash directly in your hands.
Top Cards for Common Rewards Programs
To help illustrate the differences in the secured credit card reward systems, let's discuss three credit reward programs, using actual cards (without explicitly naming them).
Card #1—Points Card
The first challenger is a points card with a regular APR of 15.99%-20.99% and a recommended credit score of 690-850. It comes with a 100,000 bonus point signup bonus. But the only way to get these bonus rewards is by spending at least $15,0000 in the first three months. In addition there’s an annual fee of $95.
How do credit card rewards work for this card?
For every dollar spent, you receive 3 points on the first $150,000 on certain purchases. It incentivizes spending on travel-related activities, providing that 3x bonus for all expenses related to travel, dining, and restaurants. It then provides 1 point for $1 on all other purchases with no limits.
The points redemption ratio is 80 points for every $1 you receive. That means a trip costing $1,250 would be 100,000 points (your signup bonus rewards). Broken down, your cash back value is approximately 1.25%.
Card #2—Miles Card
The second type of rewards card available is a business credit card that’s miles focused. It has an annual fee of $95, an APR of 17.25%-25.5%, and a late fee of $39. It also comes with a 100,000 bonus miles on your first $20,000 of purchases in the first year, or a 50,000 miles reward if you spend $3,000 in the first three months.
It provides up to 2% on all travel related purchases, including:
- Hotel reservations
- Cruise reservations
- Train tickets
- Travel agent fees
This type of rewards card is great for international travel. It provides travel booking flexibility and no foreign fees on purchases made outside of the U.S.
But what if you want to redeem miles for something unrelated to travel? They’re only worth half as much. Miles spent on travel-related expenses have a cashback value of approximately 1.5%; however, miles spent on other items only have a cashback value of 0.75%.
Card #3—Cash Back
Our third rewards credit card is a corporate charge card with a flat cash back system.
To begin, it has no annual fees or signup fees for small businesses. It allows businesses to issue an unlimited number of virtual or physical cards. Also, with a charge card, you enter into a 30-day payment cycle where you pay the full balance in exchange for zero interest.
As a result, it provides a credit limit that may be 10-20 times as high as a traditional business credit card. Instead of a complicated reward system, this card provides a flat 1.5% cash back reward on every purchase. On top of that, the card comes with a partner reward program, offering up to $175,000 in partner rewards.
Finally, although it’s not a physical reward, this secured credit card provides further cost savings that come in the form of an automated accounting system that helps you:
- Lower your bills by finding redundant or duplicated expenses
- Optimize expense reconciliation for faster month end’s close
- Gain real-time visibility and control over your spending
Which Rewards Program Do You Choose?
Ultimately the decision of what type of reward programs is best suited for your business depends on your situation. For businesses that travel frequently, a miles card may be worth it; for those that don’t, miles become practically useless.
The safest and most reliable type of reward system for a business credit card is a straight cash back program. With it, there’s no incentive to spend on things you don’t need, no complicated point conversions, and no oversight required.
Enter Ramp (card number 3). Not only do you receive a 1.5% cash back reward on every purchase made using the corporate card, it also comes with an automated expense management platform built in. The platform provides you real-time visibility of your finances, efficient expense approval and accounting workflows, and precise controls over spending.
With Ramp, there’s no games, points, or miles—just instant money back on every dollar you spend. That’s one of the many ways we’re achieving our mission of helping businesses save.