Maximizing Rewards and Cashback with a Secured Business Credit Card

Maximizing Rewards and Cashback with a Secured Business Credit Card

Maximizing Rewards and Cashback with a Secured Business Credit Card

Business credit cards can be a great tool for small business owners. But most business cards require good credit to qualify. Small business owners who have trouble qualifying for a regular small business credit card may want to consider a secured business credit card. 

With a secured card, cardholders secure their account with a deposit. (The deposit is typically returned when the account is closed if all payments have been made.) These cards feature many of the benefits of traditional cards, and may even offer rewards. 

Benefits of Using a Secured Business Credit Card

Because there are fewer providers offering business credit cards, they aren’t as reward-heavy as some of the best business credit cards. But that doesn’t mean you can’t benefit from using one of these cards. Here are some of the main perks of secured business credit cards:

Improve Cash Flow

A secured card offers you the ability to make purchases and pay for them later. Similar to net-30 vendor terms, you may have up to 30 days or more to pay for a purchase without incurring interest charges. You’ll need a card with a grace period in order to get that benefit, and the number of days you’ll have to pay without interest depends on when you make your purchase, and when the billing cycle ends. 

Reduce Risks

Credit cards are the safest way to pay for purchases. Under federal law, if your personal or business credit card is used fraudulently, your maximum responsibility for fraudulent purchases is $50. (Note that if you issue employee cards, you’ll be responsible for their use, so try to use spending controls to keep tabs on their purchases.) 

Build Credit 

Paying a credit card on time can build a valuable credit reference. A business credit card will often be reported to business credit reporting agencies, which helps you establish business credit. Over time, your on-time payments can help you build a good business credit score. 

Strong credit scores can open the door to small business loans and financing options for your small business.

Better Accounting

Using a business credit card rather than a personal credit card for business purchases will make it a lot easier to separate your business and personal finances. It’s also easier in terms of your business accounting. It’s generally a good business practice to use a dedicated credit card for your business expenses. 


If your business credit card account offers a rewards program like cash back or rewards points, and you pay your bill in full each month to avoid interest, you can come out ahead. At the time of this writing, one of the major card issuers offers a secured rewards credit card for small businesses. 

Find more business cards with travel rewards here. 

How to Get the Most Out of Your Secured Business Credit Card

If you do decide to get a secured credit card to take advantage of benefits, including secured card business rewards, you’ll want to make sure you take full advantage of perks and features. 

Take Advantage of Rewards

You’ll find that there are fewer options for secured business credit cards than for personal credit cards. But you’ll still want to consider reward-earning when possible. 

Compare Cashback Offers

Cashback rewards typically offer a reward of 1-2% back on each eligible purchase. Purchases in bonus categories like office supply stores, gas stations, or restaurants, may offer a higher cash back reward rate, depending on the card’s earn rate structure. 

Look for Sign-up Bonuses

Sign up bonuses are common on business credit cards, but much less common on business secured credit cards. A welcome bonus typically offers extra points or cash back if you spend a certain amount on your credit card within a certain number of days or billing cycles after account opening.  

Since secured cards often have low credit limits, they don’t often offer this feature. But if yours does have a bonus offer, review your spending habits to decide whether you can meet the requirements to earn the bonus. 

Take Advantage of Introductory APR Offers

Some credit cards will offer a low introductory interest rate good for several months, or even a year or longer. (Some cards even offer 0% intro APRs.) Again, this isn’t common on secured cards, but if you are able to get one this can be a great way to finance a purchase over time at a low cost. 

Strategies to Maximize Your Rewards with a Secured Business Credit Card

If you use a secured card for your business, you’ll want to make sure you take advantage of the benefits it offers while avoiding pitfalls. Here are strategies to maximize rewards while minimizing risk. 

Choose the Right Business Credit Card

There’s not a long list of secured business credit cards to choose from, so you should be able to choose the right card pretty quickly. Evaluate your business spending to help you choose the right card for your business. 

Cards may also offer other perks like purchase protection, an extended warranty, or travel perks like car rental insurance.

Keep Track of Spending

Because a secured credit card carries a lower credit limit than most unsecured cards, you’ll want to carefully track your spending. Pay down your balances quickly so you don’t run into situations where a purchase is declined because it will put you over your limit. 

Know the Redemption Period

Find out how long you have to redeem rewards. Rewards that don’t expire are ideal, but if your card doesn’t offer that benefit you want to make sure you don’t lose rewards for lack of activity. 

Also keep in mind that if you pay your card late or otherwise run into trouble, you could forfeit your rewards balance. For that reason, it may be better to use them frequently. 

Know How to Redeem Rewards

If your card earns cash back, how can you claim it? Do you need to request a statement credit? If you earn points, can you spend them on travel, gift cards, or other benefits? Take a few minutes to familiarize yourself with the issuer’s reward redemption options so you don’t leave money on the table. 

Tips for Keeping Your Balance Low on Your Secured Business Credit Card

As we’ve mentioned earlier, these cards often have lower credit limits since the credit limit is tied to a deposit. For that reason, you need to be careful how you manage your account. 

Automate Payments

Whenever possible, it’s a good idea to set up automatic payments for your card to ensure you don’t pay late. (If you do pay late, your issuer may hike your interest rate, and late payments can hurt your credit history.) As long as you make the minimum payment on time you can avoid late payments, so set that amount up for auto pay if you can. 

Pay Off Purchases Quickly

Most card issuers allow you to make multiple payments online. If you want to keep your spending limit as flexible as possible, you may want to make multiple purchases throughout the month. This can also help you avoid interest charges. 

Track Expenses Carefully

You can use your credit card in tandem with your accounting software to track your business expenses and spending. Most credit card issuers offer the ability to download your activity in a format you can upload to your accounting software. And some accounting software can pull information directly from your account. 

Monitor Your Account Statement

Monitor your account statements not only to track your spending (and possible rewards) but also to identify any possibly fraudulent activity as well as subscriptions you may not want to renew. 

What to Watch Out For with Your Secured Business Credit Card

Annual Fees

It’s not uncommon for secured cards to carry an annual fee and that may be perfectly acceptable if you’re getting value from the card. But you may not want to pay an annual fee for a card you’re not using anymore. 

Late Payment Fees

If you pay late, you may be charged a late payment fee as well as a higher interest rate. As we’ve mentioned, setting up automatic payments for at least the minimum payment on the card can help you prevent this extra charge. 

Foreign Transaction Fees

If you have suppliers or vendors outside the US, or if you travel outside of the US and make business purchases, you’ll want to try to minimize foreign transaction fees as they can add 2-4% extra to your foreign purchases. 

Balance Transfer Fees

If you are able to transfer a balance to your card, you will likely be charged a balance transfer fee of 2-5% of the amount transferred. This amount will be added to your statement along with the balance transfer. 

Which Business Credit Cards Offer Secured Cards?

Here’s a list of major credit card offers and which ones currently offer secured credit cards. This information has been independently gathered by Nav. Please check with the individual issuer for up-to-date information. 

American ExpressNo business secured card offered
Bank of AmericaBusiness Advantage Unlimited Cash Rewards Secured credit card
Capital OneNo business secured card offered
ChaseNo business secured card offered
CitiNo business secured card offered
DiscoverNo business secured card offered
First National BankBusiness Edition® Secured Mastercard® Credit Card
Union BankNo business secured card currently offered
Wells FargoNo business secured card currently offered

Find more information about the best business credit cards here.

This article was originally written on March 1, 2024.

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