Table of Contents
Introduction
Bank of America is one of the largest and most well-known banks in the United States, offering a wide range of financial products and services. One of their popular offerings is the Business Advantage Cash Rewards credit card, which promises to provide cash rewards for business owners. However, is this credit card truly a cash cow or will it leave business owners with empty pockets? In this article, we will delve into the details of the Business Advantage Cash Rewards credit card and evaluate its benefits and drawbacks.
The Business Advantage Cash Rewards Credit Card
The Business Advantage Cash Rewards credit card is designed specifically for small business owners, offering them the opportunity to earn cash back on their everyday business expenses. With this credit card, business owners can earn cash rewards on purchases made in various categories, such as office supplies, travel, and dining.
One of the key features of the Business Advantage Cash Rewards credit card is its tiered cash back structure. Cardholders can earn 3% cash back on purchases made in a category of their choice, such as gas stations, office supply stores, or travel. Additionally, they can earn 2% cash back on dining purchases and 1% cash back on all other purchases.
This tiered structure allows business owners to maximize their cash back potential by earning higher rewards in categories that align with their business needs. For example, a business that frequently spends on office supplies can benefit greatly from the 3% cash back on such purchases.
Benefits of the Business Advantage Cash Rewards Credit Card
1. Generous Cash Back Rewards: The Business Advantage Cash Rewards credit card offers competitive cash back rates, especially in the chosen category. This can result in significant savings for business owners, especially those who spend heavily in specific categories.
2. No Annual Fee: Unlike many other credit cards, the Business Advantage Cash Rewards credit card does not charge an annual fee. This can be a major advantage for small business owners who are looking to minimize their expenses.
3. Introductory 0% APR: The credit card also offers an introductory 0% APR on purchases for the first nine billing cycles. This can be beneficial for business owners who need to make large purchases and want to avoid interest charges during the initial period.
4. Additional Employee Cards: Business owners can request additional employee cards at no extra cost. This allows them to easily manage and track their employees' expenses while earning cash back on those purchases.
Drawbacks of the Business Advantage Cash Rewards Credit Card
1. Limited Redemption Options: While the Business Advantage Cash Rewards credit card offers cash back rewards, the redemption options are limited. Cardholders can only redeem their cash back as a statement credit or a deposit into a Bank of America checking or savings account. This lack of flexibility may not suit all business owners' preferences.
2. Higher Cash Back Rates Limited to One Category: While the tiered cash back structure is advantageous, the higher cash back rates are limited to one chosen category. This means that business owners who spend heavily in multiple categories may not fully maximize their cash back potential.
3. High APR: After the introductory 0% APR period, the Business Advantage Cash Rewards credit card has a variable APR that can be relatively high. This can be a concern for business owners who carry a balance on their credit card, as the interest charges can quickly add up.
Case Study: A Small Business Owner's Experience
To better understand the practical implications of the Business Advantage Cash Rewards credit card, let's consider the case of a small business owner named Sarah. Sarah owns a graphic design studio and frequently spends on office supplies, travel, and dining.
Sarah decides to apply for the Business Advantage Cash Rewards credit card and chooses office supplies as her preferred category to earn 3% cash back. Over the course of a year, she spends $10,000 on office supplies, $5,000 on travel, and $2,000 on dining.
Based on her spending, Sarah would earn $300 cash back on office supplies, $100 cash back on dining, and $20 cash back on travel. In total, she would earn $420 cash back in a year.
Considering the lack of an annual fee and the introductory 0% APR, Sarah finds the Business Advantage Cash Rewards credit card to be a valuable tool for her business. The cash back rewards help offset her expenses, and the absence of an annual fee and the introductory 0% APR provide additional financial flexibility.
Conclusion
The Business Advantage Cash Rewards credit card by Bank of America offers small business owners the opportunity to earn cash back on their everyday business expenses. While it has its drawbacks, such as limited redemption options and a high APR, the benefits, including generous cash back rewards, no annual fee, and an introductory 0% APR, make it a compelling choice for many business owners.
Ultimately, the suitability of the Business Advantage Cash Rewards credit card depends on the specific needs and spending habits of each business owner. It is important for business owners to carefully evaluate their spending patterns and compare the benefits and drawbacks of the credit card before making a decision.
