The Pros & Cons of Business Credit Cards with Travel Rewards

The Pros & Cons of Business Credit Cards with Travel Rewards

The Pros & Cons of Business Credit Cards with Travel Rewards

For small business owners, travel can be an essential part of running a company. Many companies do business remotely, and have clients and colleagues across the country and around the world. And even if your customers are primarily local, you may benefit from traveling to conferences and other events that help your professional development. If you’re a business traveler, then you’ve probably wondered if it’s worth it to get a small business credit card that offers travel rewards and benefits.

The Advantages of a Business Travel Credit Card

There are two ways that a business travel credit card can help travelers, beyond the convenience, security and financing offered by all small business credit cards. First, these cards offer travel rewards in the form of frequent flyer miles or hotel points that you can redeem for award travel. Some cards let you redeem your travel rewards directly with the card issuer’s designated travel agent, so you don’t have to worry about finding available frequent flyer or hotel awards. Furthermore, you can use your award reservations for business or personal trips. You can even redeem your travel rewards for your employees to accompany you, or just to give away as an employee incentive.

But in addition to earning travel rewards, these credit cards can offer valuable travel benefits. For example, a small business travel rewards card that’s co-branded with an airline will typically offer benefits such as priority boarding, discounts on in-flight purchases and a free checked bag. And small business travel rewards cards affiliated with hotel loyalty programs generally offer some form of elite status which can come with room upgrades, late checkouts and even free breakfast. Premium travel rewards cards for small business owners can even include memberships to airport lounges, which can be a vital tool for getting work done while traveling.

Other benefits can include insurance to cover trip delay, trip interruption and trip cancellation as well as lost and delayed baggage. Finally, some business travel credit card can come with statement credits to offset airline fees and even the application fees for TSA PreCheck or Global Entry, which includes PreCheck.

The Drawbacks of Business Travel Credit Cards

Like other reward credit cards, business travel credit cards will tend to have higher interest rates than similar cards that don’t offer rewards. Therefore, if you need to use your small business credit card to finance purchases, you should be using a simple card with the lowest possible interest rate, not a travel rewards card. However, you may choose to open an account with a small business travel rewards card just to utilize its benefits, not to finance purchases.

Another downside of travel rewards cards for small businesses is that most will have annual fees. When you travel enough, the value of these benefits can exceed the cost of the fees. But if you just travel every now and then, you could be wasting money on benefits that you rarely, if ever get to use.

Choosing the Right Travel Rewards Card for Your Small Business

When comparing small business travel rewards cards, you may want to start by looking at cards that offer you rewards with the loyalty programs you use the most. For example, if all of your business travel is with one airline, you will want to earn rewards and benefits that you can use with that carrier. And if you are partial to one hotel chain over another, you could consider the small business card that benefits you most when staying at those properties.

But if you tend to travel with multiple different airlines, or stay at various hotels, then you might be better off with a travel card that offers you rewards that can be redeemed with many travel providers. Some programs, such as Chase Ultimate Rewards and American Express Membership Rewards offer points that can be transferred to frequent flyer miles or hotel points, or redeemed directly for travel reservations.

By comparing the positives and negatives of small business travel reward cards, you can decide if one of these produces makes sense for you and your company.

This article was originally written on April 9, 2018 and updated on January 27, 2021.

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