2 Business Cards That Offer The Equivalent Of 2% Cash Back

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There’s a huge learning curve involved when it comes to redeeming traditional miles, and while I think they can offer outsized value, the reality is that most people redeem them sub optimally. So for a vast majority of people I don’t recommend using a traditional mileage earning card, given the risk and restrictions involved with earning and holding onto airline miles.

Instead, I think a vast majority of consumers are best off getting a cash back card. However, it shouldn’t just be any cash back card, but rather one that offers you at least two cents back on every dollar spent. For example, I’ve written about the Citi® Double Cash Card, which has no annual fee and offers 1% cash back when you make a purchase, plus an additional 1% cash back as you pay for those purchases.

However, there aren’t many business cards that offer a compelling cash back reward. Cards like the Ink Business Preferred℠ Credit CardThe Business Gold Rewards Card from American Express OPEN, etc., have great bonus categories, but you can typically do better when it comes to everyday, non-bonused spend.

The way I see it, there’s one exceptionally rewarding business credit card, that offers the equivalent of 2% cash back

Details of the Capital One Spark Cash for Business

The Capital One® Spark® Cash for Business offers a great sign-up bonus, has a reasonable annual fee, and offers a flat 2% cash back on purchases. Specifically, the card offers a big $500 cash bonus once you spend $4,500 on purchases within the first three months from account opening.

While the card has an annual fee of $59 per year, it’s waived for the first year. It’s not often you see a cash back card this lucrative with a sign-up bonus, so if you want to think of it differently, after having the card for nine years the amount you pay in annual fees still won’t even add up to the sign-up bonus. That’s a very reasonable annual fee for a card this rewarding.

Then the card offers a flat 2% cash back on all purchases, with no limits. For a business that spends a lot in categories not otherwise eligible for bonus categories, that’s a very compelling return.

But what about the Capital One Spark Miles for Business?

There’s also the Capital One® Spark® Miles for Business, which seems awfully similar to the Capital One® Spark® Cash for Business. It has the same annual fee, offers two miles per dollar spent rather than 2% cash back, offers a sign-up bonus of 50,000 miles rather than $500, etc.

With this card, each mile can be redeemed for one cent towards the cost of a travel purchase.

So at first I was a bit confused, because I couldn’t make sense of why anyone would get a card that offers the same reward in a much less flexible currency. However, in the context of a business card I guess it sort of makes sense.

If a business card offers cash back, that money will likely go right back into the business. Perhaps the idea is that with the miles version of the card, you’re more likely to use the rewards from the card for travel, something fun, etc. That way it feels more like a reward than just cash back to go back towards the business.

Bottom line

There’s not a perfect business credit card for everyone, though I think for someone just looking for no strings attached cash back, the Capital One® Spark® Cash for Business is tough to beat. The card has a generous sign-up bonus, very reasonable annual fee (which is waived the first year), and offers a straightforward 2% cash back. While another card could make sense if you spend a lot in specific categories, this is tough to beat for the average consumer, in my opinion.

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Comments

  1. I was pre approved for the Spark Cash with the $500 bonus and applied right away. I also have the regular Capital One Quicksilver. I have $380 left of my bonus. My strategy for this card is to earn and redeem at the same time. I paid for a plane ticket with the Chase Sapphire through their travel portal thus getting 2 points per dollar, I then transferred that balance to my Quicksilver for free. I than transferred the amount I spent on the airfare from my bonus to my Quicksilver cash account and made than redeemed for a statement credit. I received Chase Ultimate Rewards points for the booking along with airline miles AND I was able to redeem cash points. Doing the same thing with a hotel booking I made with the Wyndham Rewards credit card. Can’t beat this strategy…too bad there’s only a couple of these cards with Capital One.

  2. CAPITAL ONE SPARK CARD IS GARBAGE. They report to personal credit bureau causing a huge drop in score if you max out your card everymonth.

  3. Hi Ben. Apologies for using this forum – I have been trying to contact PointsPros but seem to be having difficulty. Are you able to assist?
    KM

  4. @ Kristopher — Hi! Did you contact us through our website? I don’t see any requests from this email address in our queue 🙁

  5. Hi Tiffany,
    Yes, twice, but through the ‘small business’ portal. Once today and once Tuesday.
    It’s the same email address used to post here. If you could please shoot me a note I’m happy to provide same details as your questionnaire.
    KM

  6. The trouble with any real business using a cash back card is that the cash rebate is taxable — either taxable outright or taxable in the sense that otherwise deductible business expenses are required to be offset by the cash rebate.

    So, the 2% cash rebate becomes less than 2% due to the income tax impact. And with self-employment taxes taken into account, it’s not difficult for it to be a 1.2% net net cash rebate (or worse).

    There is not a similar requirement to tax the financial value of points, or miles, or other non-cash incentives from credit cards.

    So I tell my business clients using business credit cards to go for points, miles, etc. and to stay away from cash back cards.

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