Chase Ink Business Cash℠ vs. Chase Ink Business Preferred℠ Credit Card
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If you’re a business owner, you know the importance of keeping accurate records and separating your business expenses from your personal expenses.
One primary method of accomplishing this is to use a business credit card (we prefer Chase or Amex) for those associated business expenses.
In addition to separating expenses, a rewards-earning business credit card can deliver benefits like business management tools/services, rewards earned on business spending categories, and other features you won’t find on personal credit cards.
Arguably, 2 of the best business credit cards available are the Chase Ink Business Cash℠ Credit Card and the Chase Ink Business Preferred℠ Credit Card.
While either card would serve as a welcome addition to your business expense protocol, one is probably better suited to your business than the other.
As we take a closer look at these popular business credit cards in this article, we’ll also cover:
- Why you need a business credit card
- What to look for and who can apply
- The importance of bonus spending categories
- Which card wins when it comes to travel
- Redemption possibilities
- Other travel and purchase protections
Let’s find out which card best fits your business operation, or if the combination of both cards can add value to your business bottom line.
Table of contents
- Why You Need a Business Credit Card
- Who Can Apply for a Business Credit Card?
- What to Look for in a Business Credit Card
- Comparing Bonus Spending Categories
- Does Your Business Involve Travel?
- Is It Better to Earn Cash-Back or Points?
- The Annual Fee: Another Expense, or Value Delivered?
- Additional Value-Added Benefits
- Final Thoughts
Table of Contents
- Why You Need a Business Credit Card
- Who Can Apply for a Business Credit Card?
- What to Look for in a Business Credit Card
- Comparing Bonus Spending Categories
- Does Your Business Involve Travel?
- Is It Better to Earn Cash-Back or Points?
- The Annual Fee: Another Expense, or Value Delivered?
- Additional Value-Added Benefits
- Final Thoughts
Why You Need a Business Credit Card
Even if you’ve been managing just fine putting your business expenses on your personal credit card, you’ll inevitably run into complications.
Here are just a few of the reasons you need a business credit card:
- Keep Personal and Business Expenses Separate – One of the primary reasons for using a business credit card is to separate your business expenses from your personal expenses. Doing so makes tax time easier and allows you to easily find documentation in the case of an audit.
- Record-Keeping Tools – Some business credit cards provide record-keeping tools that can sync with Quickbooks or other financial management software.
- Higher Credit Limits – Business credit cards can offer higher credit limits than personal cards.
- Free Employee Credit Cards – It’s easier to keep track of expenses when your employees make purchases with their business credit cards.
- Rewards for Business Purchase Categories – Business credit cards may have bonus spending categories such as office supplies, shipping, and advertising that you won’t find on personal credit cards.
Bottom Line: While there are plenty of reasons to get a business credit card, the most important one is to separate your personal and business expenses. You’ll definitely save time and frustration at tax time, and in case of an IRS audit!
Who Can Apply for a Business Credit Card?
You may be surprised to learn what qualifies as a business when it comes to applying for a business credit card.
The IRS, for example, defines a business like this: “Generally, an activity qualifies as a business if it is carried on with the reasonable expectation of earning a profit.”
Even if your side hustle is small, you may still qualify for a business credit card — because your personal credit will play a significant role in whether you get approved for a business credit card.
Registering your business as a DBA (doing business as) or LLC (limited liability company) prior to applying for a business credit card can add credibility and improve your chances of approval.
The rules differ by state as to what is required to register or license your business (if necessary), but once you have these in place you can open a business checking account too, adding even more credibility.
For more information on how to apply for a small business credit card and additional business credit card recommendations, our in-depth guides can help.
Hot Tip: The U.S. Small Business Administration offers several tips for registering your business name and determining if a state or even federal license is required.
What to Look for in a Business Credit Card
Ask Yourself These Questions
- In which categories does your business spend the most? Selecting a business credit card that rewards your biggest spending categories is important, but you’ll also need to consider if the card has limits on the rewards you can earn in each category.
- Does your business involve travel? Are you running a business from your home, or are you a frequent flyer who could use some premium travel benefits? Perhaps you’re a road warrior who spends a lot on gas purchases — either way, make sure to get a card with the right benefits.
- Do you prefer travel rewards or want to earn cash-back? Travel rewards can be used for both personal travel or business travel, but you may want to invest cash-back into your business instead.
- Can you redeem the credit card rewards for benefits you can use? You can always use the cash earned on cash-back credit cards to offset your business expenses…but would travel rewards be worth more to your business bottom line?
- Are you comfortable paying an annual fee? You may prefer a business credit card with no annual fee, but the premium benefits of a travel rewards credit card with a higher annual fee could save you money that you’re currently spending on travel perks.
As you keep these answers in your mind, let’s take a look at the Chase Ink Business Cash℠ Credit Card and the Chase Ink Business Preferred℠ Credit Card to see how each one meets your priorities.
| CHASE BUSINESS CARD | BENEFITS & INFO |
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Chase Ink Business Preferred℠ Card |
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Photo courtesy of Google Maps.
Comparing Bonus Spending Categories
One of the most prominent factors in selecting a business credit card is aligning the rewards earned with your actual business expenses.
For this reason, it’s important to look at the type of expenses your business incurs on a regular basis and which card matches up best with those categories.
| Business Spending Category | Rewards Earned on Ink Business Cash℠ | Rewards Earned on Ink Business Preferred℠ |
| Travel | 1% cash-back | 3 points/$1 spent |
| Restaurants | 2% cash-back | 1 points/$1 spent |
| Office supplies | 5% cash-back | 1 point/$1 spent |
| Internet service/cable/phone | 5% cash-back | 3 points/$1 spent |
| Gas stations | 2% cash-back | 1 point/$1 spent |
| Advertising on social media/search engines | 1% cash-back | 3 points/$1 spent |
| Shipping | 1% cash-back | 3 points/$1 spent |
Best for Startup Businesses
New businesses that spend a lot on startup expenses such as phone systems, internet service, and office supplies would fare well with a business credit card like the Chase Ink Business Cash℠ Credit Card that gives 5% cash-back in these categories.
If your new business spends heavily for online advertising, travel, and on shipping, the Chase Ink Business Preferred℠ Credit Card may be a better fit.
Another characteristic of startup business operations is the need for capital to make major purchases. The 0% introductory APR on purchases (and balance transfers) for 12 months after card approval on the Chase Ink Business Cash℠ Credit Card could help spread the repayment of major startup expenses over time.
After 12 months, a variable APR will apply (currently 14.99% – 20.99%).
The Chase Ink Business Preferred℠ Credit Card does not offer a 0% APR for either purchases or balance transfers.
Best for Everyday Business Purchases
The best business credit card for your everyday business purchases will once again depend on the mix of your largest expenses.
For example, you may have needed to set up a brick and mortar operation before you hit the road selling your product. Now that the office is up and running, your biggest everyday business expenses may be gas and dining on your regional road trips.
In this case, the Chase Ink Business Cash℠ Credit Card appears to be the best business card for your operation, with 2% cash-back at gas stations and restaurants.
You’ll still have ongoing office supply and internet/cable/phone expenses, which will continue to earn 5% cash-back as well.
If your ongoing everyday business expenses are heavier in advertising, phone/internet/cable, shipping, and travel, the Chase Ink Business Preferred℠ Credit Card will be better suited to receiving maximum rewards.
Bottom Line: A primary consideration for selecting the best business credit card for your operation will be whether the card delivers the highest rewards for your biggest expenses.
Limits on Bonus Category Purchases
One limitation of the Chase Ink Business Cash℠ Credit Card is that the 5% and 2% categories each have $25,000 limits per account year — meaning you would earn 1% cash-back on purchases that exceed those limits.
The Chase Ink Business Preferred℠ Credit Card has a $150,000 limit on 3% categories for each card account anniversary year.
Bottom Line: Anticipating your annual bonus category expenses and selecting a card that rewards all of that spending without reaching the specified limits is critical to maximizing the rewards you’ll earn.
Does Your Business Involve Travel?
The Chase Ink Business Preferred℠ Credit Card is clearly the winner when it comes to earning rewards on travel purchases. With 3 Ultimate Rewards points per dollar spent in this category, it excels for a business with travel expenses.
Chase defines the “travel” category broadly, and it covers purchases made with many vendors, including:
- Airlines
- Hotels
- Motels
- Timeshares
- Campgrounds
- Car rental agencies
- Cruise lines
- Travel agencies
- Discount online travel sites
- Passenger trains
- Buses
- Taxis
- Limousines
- Ferries
- Toll bridge
- Highway tolls
- Parking lots/garages
If you purchase travel in any of these categories on a regular basis for your business, the Chase Ink Business Preferred℠ Credit Card earning 3 points/$1 could deliver the best reward structure for those expenses.
The Chase Ink Business Cash℠ Credit Card earns just 1% cash-back on travel purchases.
When it comes time to redeem your rewards, the Chase Ink Business Preferred℠ Credit Card is also the winner, giving you 25% more value for your Ultimate Rewards points and the option to transfer points to hotel/airline partners.
Is It Better to Earn Cash-Back or Points?
While cash-back is the most liquid reward you can earn, it’s not always the best redemption value. Fortunately, with these Chase business credit cards you don’t have to decide which type of rewards you prefer to earn.
That’s because both cards have cash-back options, and both cards earn valuable Ultimate Rewards points!
| Chase Business Credit Card | Value When Redeemed for Cash Back | Value When Redeemed for Travel |
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The Ink Business Cash℠ Credit Card and the Ink Business Preferred℠ Credit Card both earn Ultimate Rewards Points that can be converted to cash-back.
The redemption difference between these cards is basically the value for which you can redeem the Ultimate Rewards points on the Chase Travel portal.
Hot Tip: You can increase the value of Chase Ultimate Rewards points earned on the Chase Ink Business Cash℠ Credit Card by transferring them to the Chase Ink Business Preferred℠ Credit Card. The points can then be redeemed for travel at the rate of 1.25 (instead of 1.0). Transferring your Ultimate Rewards Points also allows you to then transfer points to airline/hotel travel partners for potential additional travel value.
The Annual Fee: Another Expense, or Value Delivered?
The Chase Ink Business Cash℠ Credit Card does not charge an annual fee, while the Chase Ink Business Preferred℠ Credit Card has an annual fee of $95 that is waived the first year.
| Chase Business Credit Card | Annual Fee | Benefits that Can Offset an Annual Fee |
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It is easy to justify the $95 annual fee on the Chase Ink Business Preferred℠ Credit Card if you’ll be redeeming Chase Ultimate Rewards points for travel.
For example, if you have business spending of $20,000 per year in 3-point bonus categories, you’ll earn 60,000 Ultimate Rewards points worth 1 cent each when redeemed for cash.
When redeemed for travel on the Chase travel portal, you will receive an additional 25% ($150) in value, which will more than offset the $95 annual fee.
Bottom Line: If your business includes travel, you should more than offset the $95 annual fee of the Chase Ink Business Preferred℠ Credit Card with the 25% increased value of your Ultimate Rewards redeemed on the Chase Travel portal.
Additional Value-Added Benefits
Both business credit cards we’re comparing offer free employee cards, which can help you manage your business expenses and build rewards faster.
As we compare the additional cardholder benefits of the Chase Ink Business Cash℠ Credit Card and the Chase Ink Business Preferred℠ Credit Card, we’ll find that the overall benefit packages are similar (with a couple of critical exceptions).
Redemption Options
| Redemption Option | Chase Ink Business Cash℠ Credit Card | Chase Ink Business Preferred℠ Credit Card |
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Bottom Line: When it comes to redemption options, you’ll receive 25% additional value when redeeming Ultimate Rewards points via the Chase Travel portal with the Chase Ink Business Preferred℠ Credit Card, plus have the flexibility of transferring points to hotel/airline partners.
Travel Benefits
| Benefit | Chase Ink Business Cash℠ Credit Card | Chase Ink Business Preferred℠ Credit Card |
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Bottom Line: The Chase Ink Business Preferred℠ Credit Card has additional travel benefits when compared to the Chase Ink Business Cash℠ Credit Card, including cell phone coverage. It also does not charge foreign transaction fees.
Purchase Benefits/Protections
Shopping benefits and protections for each of the compared cards are the same.
| Benefit | Chase Ink Business Cash℠ Credit Card | Chase Ink Business Preferred℠ Credit Card |
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Final Thoughts
If your small business has annual expenses in bonus categories that do not exceed the limits of the no-annual-fee Chase Ink Business Cash℠ Credit Card, it would be a worthy choice — especially if your business doesn’t have a lot of travel expenses.
However, if your business includes purchasing a lot of travel, the Chase Ink Business Preferred℠ Credit Card would be a better fit — especially if you spend more than $25,000 in any of the bonus categories.
Additionally, the Chase Ink Business Cash℠ Credit Card charges foreign transaction fees. So if your business makes international purchases or includes international travel, you would want to consider the Chase Ink Business Preferred℠ Credit Card.
Also, the Chase Ink Business Cash℠ Credit Card earns only 1% cash-back on travel purchases.
Since the business bonus spending categories on these cards differ, the combination of having both cards may be an appropriate option for earning maximum rewards.
Having both business credit cards opens up the possibility of transferring points to hotel/airline partners (with the Chase Ink Business Preferred℠ Credit Card) and receiving even more value for your Ultimate Rewards points.
Finally, be aware that both cards fall under Chase’s 5/24 rule, meaning that if you have opened 5 or more new credit cards from any issuer in the past 24 months, you likely won’t be approved for either of these cards.
*Featured image credit: Shutterstock.com
