Best Credit Cards for Small Business Owners

With National Small Business Week kicking off this month, personal-finance websites CardHub and WalletHub have released a trio of reports to help small business owners find the best credit cards and bank accounts for their needs.

Business credit cards enable you to effectively track company expenses and earn rewards on spending. However, business credit cards aren’t covered by the CARD Act, which means they don’t benefit from protections such as those outlawing universal default, unfair payment allocation and, most importantly, arbitrary interest-rate increases. Most major credit card companies retain the right to jack up the cost of your debt at will, which is especially troublesome when you consider that most issuers report account information to users’ personal credit reports and hold them personally liable for debt, according to CarbHub.

In selecting 2016’s Best Business Credit Cards, some of which come from CardHub sponsors, these are the ones that excel in the various categories most important to small business owners: approvability, lucrative rewards, 0% rates and/or CARD Act Protection.

Best Business Credit Cards

  • Best for Excellent Credit: Credit cards from American Express account for approximately 24% of the total dollar volume of credit card transactions in the U.S. — the highest of any issuer. American Express has built this lead thanks to a reputation for strong customer service as well as attractive rewards credit cards and charge cards targeted to people and businesses with excellent credit.
  • Best Initial Bonus: Ink Plus Business Credit Card — Up to $750 in travel rewards when you spend $5,000 within three months of account opening.
  • Best Cash Back: Capital One Spark Cash for Business — 2% cash back across all purchases, $500 bonus for spending $4,500 in the first three months, and no first year annual fee ($59 thereafter).
  • Best for Financing: Citi Diamond Preferred Card — 0% on purchases for the first 21 months and no annual fee. (Small business users should always finance company purchases with general-consumer products.)

Effective cash management is critical to small business success. But it can be difficult to find an adequate business bank account these days, as a confluence of unique market dynamics have resulted in business-branded accounts falling to the bottom of the banking totem pole, according to WalletHub. Personal accounts, particularly online checking accounts, are now preferable for many small business owners as a result.

Business bank accounts still have their virtues, though. Like business credit cards, business checking and savings accounts tend to offer certain features geared specifically to the needs of corporations. Having a business checking account, whether or not you supplement it with a personal account, also simplifies tax preparation. From from WalletHub’s report the best overall: Bank of Internet USA Business Interest Checking — 0.80% APY, $10 monthly fee that’s avoidable with a $5,000 average daily balance, and 60 free account transactions per month. Best Rewards: First Bancorp Business Essentials Checking — No monthly fee as long as you maintain a $1,000 minimum balance ($8 otherwise) and 0.56% cash back on debit card purchases.

What’s more, Bank of America continues to be the most small-business-friendly credit card company, as it is the only major issuer to have extended all of the major CARD Act protections that consumers enjoy to its business-branded cards.