Just because you have bad credit, it doesn’t mean that you can’t be a small business owner. Many small-business owners have less-than-perfect credit, in fact.
And they don’t let it stop them from taking advantage of one of the most important tools that a small business owner can have: a business credit card. Quite a few of them use Bank of America’s Business Advantage Unlimited Cash Rewards Mastercard® Secured Credit Card, one of the best secured credit cards designed specifically for small-business owners’ needs.
What Is the Business Advantage Unlimited Cash Rewards Mastercard® Secured Credit Card?
The Business Advantage Unlimited Cash Rewards Mastercard Secured credit card is a secured credit card that offers business owners with credit issues the opportunity to earn cash back without paying an annual fee.
As with any secured card, you need to provide a security deposit to establish your credit limit and begin making purchases. The minimum security deposit is $1,000. Upon approval, your credit line will be equal to your deposit amount.
One notable differentiator: Many secured cards don’t earn rewards, but this one does. Sure, the return is “only” 1.5% cash back, but that’s more than many similar cards offer. Plus, there are no rotating or tiered spending categories to keep track of.
Other notable benefits of the Business Advantage Unlimited Cash Rewards Mastercard Secured card include:
- Overdraft protection with a linked Bank of America bank account
- Free access to your Dun & Bradstreet business credit scores
- Travel and emergency services, including up to $100,000 in travel accident insurance, auto rental insurance, emergency ticket replacement, lost luggage assistance, and legal and medical referrals while traveling
There is no annual fee for this card, but there is a 3% foreign transaction fee.
What Sets the Business Advantage Unlimited Cash Rewards Mastercard® Secured Credit Card Apart?
This card has several features that help it distinguish itself from other credit cards in its category.
- 1.5% cash back. Many secured cards don’t earn rewards. Even though this card only earns 1.5% cash back, it is more than many other similar cards offer, and the rate applies on all eligible purchases.
- No late fee for balances less than $100. Most cards charge late fees no matter the balance, so the fact that this card doesn’t charge a late fee if your balance is less than $100 sets it apart.
- Travel and emergency services. This card is not a travel rewards card, but it does offer some travel and emergency services. The biggest perks are auto rental insurance and up to $100,000 in travel accident insurance. These are the basics that business travelers should always have when away from home.
- Overdraft protection. As a business owner, you may run into occasional overdraft issues. This card offers an optional service to help prevent overdrafts and transactions declined due to insufficient funds. The only catch: You need an active Bank of America business checking account to link to your card account.
Key Features of the Business Advantage Unlimited Cash Rewards Mastercard® Secured Credit Card
The Business Advantage Unlimited Cash Rewards Mastercard Secured credit card offers the ability to earn cash back, overdraft protection and a few additional benefits.
The minimum credit limit is $1,000. Your actual credit limit is equal to your security deposit but may be subject to Bank of America underwriting and product maximums.
This card earns 1.5% cash back on all purchases. There is no annual cap and rewards don’t expire as long as your account remains open and in good standing.
You can redeem your rewards for cash back in the form of a direct deposit into your Bank of America checking or savings account, as a card statement credit or as a check.
This card doesn’t charge an annual fee.
However, it does charge:
- A balance transfer fee of 4% of the amount of each transaction
- A cash advance fee of 4% of the amount of each transaction
- An international transaction fee of 3% of the U.S. dollar amount of each transaction.
There is no late payment fee if the balance is less than or equal to $100. For higher balances, the late payment fee is:
- $29 for balances between $100.01 and $1,000
- $39 for balances between $1,000.01 and $5,000
- $49 for balances greater than $5,000
Overdraft Protection (Balance Connect)
This card offers an optional service to help prevent overdrafts and NSF denials, including those caused by returned checks. Called Balance Connect, it kicks in as soon as you link your credit card to a Bank of America business checking account. Fees may apply.
This card offers additional travel and emergency services, including $100,000 in travel accident insurance. Additional travel-related services include:
- Auto rental insurance, subject to limits and exclusions
- Emergency ticket replacement
- Lost-luggage assistance
- Legal and medical referrals when you’re away from home
Fees may apply for some of these services.
This card is a secured card, which means you need to provide a security deposit in order to use the card. But in general, even applicants with poor credit can be approved for this card, as long as they can provide the $1,000 minimum security deposit.
Potential for Upgrade to an Unsecured Account
If you use this card responsibly for a period of several months — meaning you make timely payments and keep your credit utilization in check — Bank of America may review your account for an upgrade to an unsecured card with even better rewards and more favorable terms.
Pros & Cons
There’s more to like than dislike about the Business Advantage Unlimited Cash Rewards Mastercard Secured credit card. But there are some drawbacks to be aware of upfront too.
- Easy to qualify with poor credit
- Earn cash back
- Transition to a non-secured card with responsible use
- $1,000 minimum security deposit
- No sign-up bonus
- No 0% APR intro financing offer
The Business Advantage Unlimited Cash Rewards Mastercard Secured credit card is a unique credit card that has several compelling advantages for small-business owners.
- Qualify with poor credit. Like other secured cards, this one is designed for people who have had serious credit problems. Credit issues are especially bothersome for business owners who might not be able to grow without reliable access to capital.
- Earn cash back. This card offers 1.5% cash back on all purchases, with no limits. This is competitive for any card and legitimately outstanding for a card designed for applicants with poor credit.
- Potential to transition to a non-secured card. The point of a secured card is to build credit and move on to standard, unsecured cards. This card offers periodic reviews of your account, and the chance for a seamless transition to another Bank of America small-business card when your credit history improves.
This is a valuable offer for small business owners with credit problems, but there are some downsides that you should be aware of.
- $1,000 minimum security deposit. There are plenty of consumer-facing secured cards that have much lower security deposit requirements.
- No sign-up bonus. You shouldn’t expect to find a sign-up bonus on a secured card, so this isn’t a surprise, but it’s worth nothing nonetheless.
- No 0% APR financing offer. Just as with a sign-up bonus, you shouldn’t expect to find a promotional financing offer on a secured card. No surprise here either, but something to be aware of.
How the Business Advantage Unlimited Cash Rewards Mastercard® Secured Credit Card Stacks Up
This card’s closest competitor is probably the First National Bank of Omaha Business Edition Secured Mastercard Credit Card. Here’s how the two cards compare.
|Business Advantage Unlimited Cash Rewards Mastercard® Secured credit card||First National Bank of Omaha Business Edition® Secured Mastercard® Credit Card|
|0% Intro APR||None||None|
|Foreign Transaction Fee||3%||3%|
|Credit Needed||Poor or better||Poor or better|
The Business Advantage Unlimited Cash Rewards Mastercard Secured Credit Card beats out FNBO’s alternative on two fronts: no annual fee and unlimited 1.5% cash back on eligible purchases. Those two selling points should be all you need to make the right decision.
People with bad credit can be business owners — they just might not qualify for an unsecured business credit card right away.
But that’s fine. In fact, it makes choosing that first business credit card a bit easier. There aren’t many secured business cards on the market. And when you consider that the Business Advantage Unlimited Cash Rewards Mastercard® Secured credit card from Bank of America offers unlimited rewards with no annual fee, the choice couldn’t be any clearer.