Business Credit Cards with Rewards

Business Credit Card, Meet the Rewards Program!

How does your existing credit card help your business? Or does it just give you the usual interest free days on purchases and statements that integrate with Quicken? The truth is there’s so much more that your business credit card can do, not only to make life easier, but to make it more enjoyable. Fancy an upgrade to business class on your next trip? How about getting your next hotel booking for free? These are the kind of things a rewards business credit card can do for you, and much more!

Cool! But are They Worth the Effort?

Business rewards cards can be very rewarding when you you use it wisely and pay it off on time. But how rewarding? If it takes 192,000 QFF points to fly return from Sydney/Melbourne to London with Qantas and you purchase $10,000 per month of goods and services at a rewards ratio of 1.5 points per dollar, then you’ll nearly have enough points for a free return flight to London every year. Not bad!

Help in Choosing a Card

Q: How much do you put on your credit card each month? A: If you want to make a rewards program business credit card work for you then you need to actually use it, a lot! Use it to buy everything from office supplies and meals out to flights and even paying taxes. If it’s something your business needs, then it goes on the card. If you don’t really spend very much money per month, in all likelihood you won’t be getting the most out of the card and at best the value of the rewards earned will break even with how much the card costs to own.

Q: What if the business card isn’t paid off in full each month? A: This is one of the most common problems with any reward card. If you want to make a business reward card work, then there’s absolutely no doubt about it – you’ve got to pay off the balance of the card in full each month. Failing to pay off your balance in time means that you’ll be charged interest, which will quickly diminish any real-world value of any rewards points earned. Just to confirm, in case there was ever any doubt, the best policy is to pay off your balance each month.

Q: How many business reward points can be earned? A: This largely depends on how much you spend and the card you choose. Some will have promotional offers that give you bonus points when you sign up, while others will offer a higher points : spend ratio for an introductory period. If you plan on sticking with your card for a while and regularly spend on it, then it may be beneficial to look for a card with a higher points : spend ratio rather than an introductory offer and subsequently lower points : spend ratio.

Q: What about points capping and expirations? A: Yes, these are definitely worth watching out for. If you want to use your rewards for something that requires a lot of points, e.g. long haul flights, and you aren’t spending tens of thousands of dollars each month (and paying off the balance too), then the expiration date comes into play. In a situation like this, you’ll want points to either expire as far away as possible (so you have a chance to build up enough of them) or, even better, never! Capping is also a common practice where the bank will either cap the amount of points you can earn or cap the number of points you can earn at a high rate. If you are applying for a new rewards card, watch out for when your points will expire, if at all, and whether there is a points cap in place.

Q: What rewards programs are available? A: In short, a lot, but the most popular business cards are probably those that let you earn points with the Qantas Frequent Flyer program as well as points with other airlines. Other reward programs include Velocity, Amplify, Emirates Skywards and Singapore Airlines KrisFlyer, among others.

Q: Can staff earn points with their own cards? A: Yes, they most certainly can. Most cards, whether they have a rewards program or not, will allow additional cardholders under the same account. If you want your staff to have their own card (to pay for expenses while travelling, etc.) then this is a must-have feature that will really help boost the number of reward points earned overall.

Q: What rewards can be earned? A: Broadly speaking there are different sorts of rewards credit cards for businesses, so you need to carefully consider what way you want to be rewarded. Some of them will enroll you in the bank’s own reward program and you’ll then earn points that you can redeem for a very wide range of goods and services. Other cards will be more focused on earning frequent flyer points, which tend to be linked with Qantas or another major domestic or international airline.

Q: What can reward points be redeemed for? A: Business rewards credit cards are obviously aimed at businesses, and so you’ll be able to redeem your points for things that a business is likely to need. The most obvious of these is free or reduced price flights. Many of the cards available will let you earn points that can be used for domestic and international flights. Another popular way to use the points is for hotel accommodation, which is possible at many hotel chains. Other cards will simply accrue reward points as you spend, which you can then redeem as shopping vouchers.

Q: American Express, Visa or MasterCard? A: American Express are renowned for their rewards programs, but they’re not as widely accepted as either Visa or MasterCard. When you’re trying to put as much of your spending through your card in order to earn as many points as you can, then this becomes an issue. AmEx cards are widely accepted at restaurants, hotels, airlines and car rentals, but their acceptance at smaller local suppliers and shops is patchy. So before you apply for a new business reward credit card, analyse where you do most of your spending and what type of card they accept. American Express may have a better points earning ratio, but if you can’t actually use the card to make purchases with then you’ll not earn many points in the first place!

Q: How do these cards compare with business frequent flyer cards? A: Business frequent flyer cards are designed to reward with frequent flyer points linked to an airline like Qantas or Singapore Airlines, whereas business reward cards will include frequent flyer points among other types of rewards.