What is a business credit card?
A business credit card is basically a credit card that is intended for business use rather than for one’s personal use. It doesn’t matter if your business is a corporation, partnership or sole proprietorship. Business credit cards can be used by all sizes and types of businesses. Typically, business credit cards are used to improve a company’s cash flow and build its credit score. The benefit of the latter is that it will boost a company’s credit borrowing terms in the future. A business credit card comes in handy for businesses that are in need of financing but do not qualify for a business loan.
How is a business credit card different to a personal credit card?
Small business owners can choose to either apply for a personal credit card or business credit card. While it is true that both credit cards have a lot in common, there are a few distinct differences between the two. The first difference is that Canadian business credit cards have a higher credit limit compared to personal credit cards. Therefore, if your business makes a lot of expensive purchases every month, a business credit card may suit you better than a personal credit card. The second difference is that personal credit cards are protected under the Credit Card Act of 2009 while business credit cards are not protected by these laws. Therefore, it is difficult for banks issuing personal credit cards to increase the APR of a balance you have. On the other hand, business credit cards come with a lot of risks in case it carries a balance. In this article we will show you the best small business credit cards avaialble on the market.
Types of Canadian business credit cards
- Low rate business credit cards
Low rate business credit cards are ideal for new companies that are looking for a credit card with a low competitive interest rate. The benefit of this type of business credit card is that it offers increased interest-free days and attracts no annual fee.
- No fee business credit cards
No fee business credit cards don’t attract an annual fee, making them ideal for some types of businesses. If you are a small business owner with a low spending, then this credit card might be right for you. No fee business credit card lets you earn extra rewards for your business expense in case you cannot afford an expensive business credit card with more perks.
- Rewards business credit cards
Rewards business credit cards is a credit card that lets your business earn rewards on what it buys the most. Companies with higher spending power can take this credit card and benefit from rewards such as free travel bookings, cash back offers, and discounts.
Why should your company use business credit cards?
Canadian business credit cards can help your business establish a credit history. That will of course work in your favor while looking to borrow loans from banks. Using the right business credit card can also fuel your company’s growth. For example, business credit cards offered by Chase can come with a variety of business credit products which can increase your business’ purchasing power and boost its growth. Business credit cards such as Ink from Chase are good for businesses that want to control employee spending. It offers free employee cards that give your employee the spending power within the set limit. You can easily monitor each employee card using the Ink mobile app.
Today, there are many Canadian business credit cards that are offered by different banks and financial institutions. From cash back to 0% intro APR business credit cards. It can be difficult to know which type of credit card best suits your business needs. However, while looking for the best business credit cards Canada, it is important you pay attention to the slightest of details. Business credit cards can help your business earn rewards, organize expenditures, and save money on interest payments. Therefore, choosing the right business credit card can help business owners save large amounts of money.
Are you searching for the best business credit cards in Canada? Here are the Best Canadian Business Credit Cards that you can choose depending on your needs.
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1. BMO Rewards Business Mastercard
Are you looking for a business credit card that offers you valuable rewards for all your purchases and attracts a lower interest rate? The BMO Rewards Business Mastercard is one credit card that business owners should consider. If you are a small-medium business owner and you don’t prefer a cash back reward, then you can consider the rewards offered by this BMO business credit card. With this business credit card, you will earn BMO rewards points that you can redeem for travel, electronics, gift cards and more. The BMO Rewards Business Mastercard is ideal for SMB owners with significant expenses on internet bills, mobile phone, gas, and office supplies.
This BMO business credit card attracts an annual fee of $120 that is waived off during the first one year. The BMO Rewards Business Mastercard has a foreign transaction fee of 2.5%, a balance transfer fee of $3.50, and a cash advance fee of $1.5. The cash advance fee on ATMs is set at a maximum of $4.50. On the other hand, cash advances over the counter are set at a maximum of $6 and a minimum of $3.
The BMO Rewards Business Mastercard attracts a lower interest rate of 14.99%. This makes it suitable for SMB owners that don’t like paying high-interest rates on business credit cards. For example, the 30% interest rate charged on the Amex Business Gold Rewards Card.
Sign up bonus
SMB owners get to earn a sign-up bonus of 35000 points after spending $5000 on purchases in the first three months of opening their account. The low spending threshold makes the BMO business credit cards suitable for business owners of partnerships, sole proprietorship, and corporations.
The BMO Rewards Mastercard gives you the opportunity to earn 3 BMO rewards point for every dollar spent on office supplies, gas, and internet bill/ cell phone payments. The annual spending limit for the accelerated rewards is set at $50000 from which point users will earn 1.5 BMO rewards point for every dollar spent.
2. Amex Business Gold Reward Card
The Amex Business Gold Rewards Card is among the best travel credit cards available in Canada. This business credit card can be used to finance the purchases of your business’
equipment, inventory, and travel. In the process, small business owners will earn rewards points that they can redeem for various benefits such as travel. Rewards points are very flexible to accumulate and will add up fast if the card is used frequently. This business card has an annual fee of $175 which is waived off in the first year. Business owners can, therefore, check if the Amex Business Gold Canada and its benefits are suitable for them or not.
Sign up bonus
The Business Gold Reward Card from American Express has a sign-up bonus of 50000 rewards points (about $950) after spending $5000 in purchases during the first three months.
With this business credit card, you get to earn 3 reward points for one dollar spent on either one of advertising, airfare, shipping, computing or gas. From there, you will automatically earn 2 rewards points on the four remaining categories. All the five categories limit the earning bonus to the first $100,000 spent on purchases during a calendar year. If that limit is passed, your earning bonus will be 1 reward point for one dollar spent.
The Amex Business Gold Reward offers you lots of flexibility when it comes to redeeming your reward points. Cardholders can transfer their membership reward points to partner programs such as Aeroplan, British Airways, and Etihad Guest.
3. Chase Ink Business Preferred Credit Card
Are you a business owner looking for a business credit card that lets you earn massive points on your monthly purchases? Then this is the best business credit card to choose. The Ink Business Preferred from Chase is a new business card that rewards businesses with a lot of shipping, advertising, and travel expenses. This business credit card attracts an annual fee of $95, but its lucrative sign-up bonus which is worth about $1000 makes it easier for businesses to cover the annual fee. Business credit cardholders can earn 80,000 bonus points after spending $5000 on shipping, travel, internet or advertising purchases within the first 3 months of opening their account. That is worth about $1000 if the bonus points are redeemed via the Chase Ultimate Rewards portal.
Huge sign-up bonus for Chase credit cards Canada
Business owners get to earn 80,000 bonus points if they spend $5000 on purchases within the first three months of opening their account. That is worth about $800 when the bonus points are redeemed for general purchases or cash back, and about $1000 when the points are redeemed for travel purchases.
High earning rewards with Chase credit card Canada
With Chase Ink Business Preferred, you will get one point per dollar spent but that moves up to three points per dollar spent on the first $150,000 across different categories such as the internet, telephone service, shipping, travel, and advertising.
Redeeming rewards with the Chase cards Canada
Chase’s Ultimate Rewards lets you redeem your points for travel (airfare, hotels, and rental cars), cash equivalents (like bank account deposits), general merchandise, and gifts cards among others. With 50000 points, you can redeem it for cash worth $500. The same number of points, when redeemed for travel, is worth $625.
Transfers to hotel and airline programs
It is not a must for businesses to redeem their points via the Ultimate Rewards portal. They can choose to transfer their accumulated points on a one on one basis to hotel and airline programs such as British Airways Executive Club, Southwest Airlines Rapid Rewards, and Marriot Rewards. You will need a minimum of 1000 points to transfer your points to other traveler programs with this Chase Visa Canada card.
4. Capital One Spark Cash Business Card
Capital One Spark Cash Business Card is one of the best cash rewards credit cards available today. This Capital One business credit card Canada comes with unlimited 2% cash back on all your purchases. It also comes with a sign-up bonus of $500 when you spend $5000 on purchases within 3 months of opening your account. The Capital One Spark Cash Business Card attracts a $0 annual fee in the first year and $95 thereafter. This business credit card is ideal for business owners with less frequent travels.
Sign up bonus with Capital One business credit card Canada
Business will get a sign-up bonus of $500 after spending $4500 on purchases during the first three months of opening their account. When you compare this bonus to other business credit cards such as Ink Business Preferred Credit Card, it is fairly low while the minimum spending amount is a little bit high.
High earning rewards
Spark Cash lets business owners earn unlimited 2% on all of their business spendings. Many business credit cards have a rewards rate of 1%, making Spark Cash Business Card the best cash rewards credit card available in the market today.
Accumulated cash back can be redeemed at any time and in any amount for statement credits or paper checks. Once you reach a specific dollar amount in cash back earned, you can set a time when you can automatically redeem the points.
The $95 annual fee that this business credit card attracts is waived off during the first year. In addition, Spark Cash Business Card has no foreign transaction fee, extra employee cards fee or balance transfer fee.
5. Scotia Momentum for Business Visa Credit Card
Scotia Momentum for Business Visa Credit Card is considered by many people to be the best Canadian cash back business credit card. The reason this business credit card is so popular in Canada is that the rewards are simple to redeem and easy to earn, thus making it an appealing cash back credit card for most types of businesses in the country. The most impressive feature of the Scotia Momentum for Business Visa Credit Card is the cash back rate of 3% on all gas station, office supplies, restaurants, and recurring payments. In addition, business owners can earn 1% on all other business purchases that are eligible. This business credit card has an introductory interest rate of 0.99% on balance transfers during the first six months.
Interest rates with this Scotiabank business credit card
The Scotia Momentum for Business Visa Credit Card attracts an interest rate of 19.99% on all purchases. While balance transfers, cash advances, and Scotia credit cards attract an interest rate of 22.99%. Note that balance transfers come with an introductory interest of 0.99% for the first six months. Business owners also get to enjoy an interest-free grace period of twenty-five days.
Fees for Scotia Momentum for Business
This cash back credit card has an annual fee of $49 and $29 for each extra supplementary card. Certain transactions that are done by this business credit card attract a service fee. For example, foreign currency transactions and cash advances that are obtained via ABMs which belong to other financial institutions.
Visa payWave is a new payment feature that makes it convenient and faster for users to pay using the business credit card at no extra fee. This feature will save you time while paying for day to day business purchase. All you have to do is wave your business credit card over a card reader and go. There is no need for signing, swiping or entering your PIN.
Travel Emergency Medical Insurance
As a card member of Scotia Momentum for Business Visa Credit Card, you, your spouse and dependent children accompanying you are covered up to one million dollars in emergency medical coverage in case of accidental injury or unexpected illness while traveling outside Canada or your province. The insurance coverage includes expenses such as nursing care, hospital care, surgeon and licensed ambulance fees.
As with any niche product, business credit cards have pros and cons when compared to normal credit cards, compared to student credit cards and so on. That’s why it’s important to read what they offer and what they charge for any type of transaction so you will know which one is the best Canadian credit card.