Editor’s Note: American Express is a partner of Fundera.
When you’re considering the many business credit cards available, you’ll probably find yourself weighing the pros and cons for every option out there.
You love the idea of earning valuable rewards and cash back savings on your small business’s purchases… But on the other hand, you’re not too fond of the harsh fees you’ll incur when your cash flow is tight and you can’t pay your charge card balance in full.
Is there a credit card that can give you the best of both worlds?
The answer is yes: it’s the Plum Card from American Express.
With the Plum Card, flexibility is the name of the game. This charge card offers you cash back rewards on your small business’s purchases, but it isn’t like every other cash back card.
While most cash back rewards cards confine you to certain eligible categories, the Plum Card doesn’t limit the way you earn. Instead, Amex’s Plum Card gives you cash back on all your purchases.
Here’s how the Plum Card’s cash back rewards work:
When you pay ahead of schedule—10 days ahead, that is—you’ll earn 1.5% cash back on all your purchases, with no cap on what you can earn.
Here are some numbers to show just how much you can get back on your expenses when you use the Plum Card.
Say you spend about $8,000 each month for your business. Just by paying ahead of schedule, you’ll earn $120 back on your expenses each month. When you think about that in the long term, that’s $1,440 you’re saving on purchases each year.
Remember when we said that the Plum Card gives you the best of both worlds?
Well, here’s why:
You’ll not only be getting substantial cash back on your purchases when you pay early, but you also won’t be punished when you can’t pay your bill on time.
Business credit cards will typically have a grace period of about 25 days to pay your bill without incurring a late fee. And when it comes to business charge cards, it gets even worse: with a charge card, you must pay your balance in full every month to avoid hefty fees.
Here’s where the Plum Card shines: it gives you up to 60 days to pay your bill without having to worry about any late fees or penalties.
To qualify for this, you’ll need to pay just 10% of your balance initially. As long as you’ve paid that 10%, you can take the remaining 60 days to pay your balance.
As any small business owner knows, running your own company can be an unpredictable game.
One month you might have a surge in sales, making your cash flow the strongest it’s ever been. But the next month might be a different story. Maybe your customers are slow to pay up—or you need to cover an emergency. With the unexpected dip in your cash flow, you might worry how you’ll pay your credit card bills.
The Plum Card is the perfect credit card for businesses who can’t count on a regular cash flow and could use some flexibility in how they repay.
During the best months, you can pay your balance off early—and earn significant cash back for it.
When business is slow, you can take the time to pay without having to worry about being punished for it.
The Plum Card really sets itself apart from other business charge cards by its cash back rewards and its deferred repayment system.
But that’s not all it has to offer.
Here are some other benefits you can expect from the American Express Plum Card:
The Plum Card is a charge card, so you won’t have to worry a preset spending limit.
You won’t be able to spend at a totally unlimited amount, but you’ll have a lot purchasing power without a hard spending limit. Plus, without a preset spending limit, your credit line can grow with your business.
If you’re always making big purchases on your credit card or you want the flexibility to do so in the future, it might make sense to use the Plum Card.
Most business credit cards on the market will charge you a foreign transaction fee—but the Plum Card doesn’t.
This makes the Plum Card a great choice for business owners who are frequently traveling abroad for their business.
Adding employees to your charge card account can get expensive. But with the Plum Card, you can get cards for your employees at no additional annual fee.
Plus, when you take out Plum Cards for your business, they can take advantage of the early pay 1.5% discount on their cards, too.
The Plum Card is a part of the American Express OPEN Savings service. With OPEN Savings, small business owners will have access to some sizeable perks.
OPEN Savings gives you access to:
If you’re always taking your clients out to keep them satisfied with your business, make sure you’re purchasing any event tickets with the Plum Card.
The Plum Card gives you access to exclusive presales for the most popular events, so you can give your clients top-notch entertainment—at a fraction of the cost.
If you’re spending a large amount on equipment purchases for your business, then you should consider using the Plum Card.
The Plum Card offers an extended warranty program—which can be pretty valuable if you find yourself running into problems after your manufacturer’s warranty expires.
For business owners that need a little flexibility from time-to-time, we think the Plum Card is a perfect fit.
But you might be hesitant to sign up when you see the Plum Card’s annual fee: it’s $0 for the first year, then $250 after that.
That might seem steep for a business credit card, but here’s why we think you should still consider using the Plum Card:
The right kind of spender will easily make up for the annual fee in what they save on cash back.
If you spend just $1,400 each month on your small business, you’ll break even on the Plum Card’s annual fee. Business owners who spend at least this much money on their expenses each month shouldn’t hesitate on the Plum Card because of the annual fee.
But remember: in order to qualify for cash back and make up the annual fee, you’ll need to pay your bill within 10 days of your statement closing date—every month.
Amex’s Plum Card fits two kinds of business owners: those who always have the cash on hand to pay off their balance early and those who could use a little wiggle room on their repayment period.
It’s also a great fit for business owners who need a forgiving credit card—one that recognizes that month-to-month cash flow can be bumpy.
After this flexibility, the Plum Card’s significant cash back rewards is just a cherry on top.
Ready to take the next step?