Bank of America Business Advantage Cash Rewards Mastercard Review

Full Review of Bank of America Business Advantage Cash Rewards Mastercard

Pros Explained

• Maximize Cash-Back Rewards in the Category of Your Choice: One of the best features of the Bank of America Business Advantage Cash Rewards Mastercard is its flexibility to adapt its best rewards to the categories in which you spend most. Month by month, provided you’re willing to actively do so, you can change the category in which you earn 3% in cash back. That’s helpful if, for example, you spend most on travel in the early months of the year, when many conventions are held, and then maximize driving for business in fall, when you might spend more on gas than on plane tickets and hotels.
• Rewards Boost With a High-Balance Bank or Investment Account: You may be able to increase your cash-back rewards rates if you hold a business bank account with Bank of America or a business investment account with Merrill. However, you need to have a lot in the account to qualify. The minimum balance is $20,000, which earns a 25% cash-back bonus.

Cons Explained

• Annual Spending Cap Limits Rewards-Earning Potential: While Bank of America is generous in allowing business card members to choose their 3% cash back rewards category, there is a catch. That rate and the 2% cash back on dining is limited to a combined annual total of $50,000. Once you hit that threshold, you'll continue earning cash back, but at a rate of only 1%. At more than $4,000 a month, the spending cap shouldn’t hamper truly small businesses. But an enterprise that has multiple cardholders might hit the maximum fairly easily.  
• Limited Benefits, Notably for Business Travel: The few extras this card offers are mostly limited to fairly standard business-card features to better manage its account, such as overdraft protection and cash-flow management tools. When it comes to travel, especially, the card offers no premium travel benefits and purchases made outside the U.S. are subject to a 3% foreign transaction fee. 
• The One-Time Offer Could Be Better: The Bank of America Business Advantage Cash Rewards Mastercard gets credit for offering any one-time offer; a number of business cards lack one, especially if they also have no annual fee, and some pay less than this card does. That said, there are also business cards with which you can earn more than $300 for spending $3,000 in the first 90 days after opening an account. Examples are two Chase cards with no annual fee—the Ink Business Cash and Ink Business Unlimited—which both offer $500 in cash back for the same 90-day “spend.”  

This card is best suited to those who prefer earning cash rewards to points or miles, and who also appreciate having a say in where they earn the best rewards each month. It’s also an ideal match for those who have a balance of $20,000 and up in either a Bank of America bank account or a Merrill investment one. Such account holders can boost their rewards by between 25% and 75% through the bank’s Preferred Rewards for Business program. So instead of earning 3% cash back on office supplies, for instance, you could earn as much as 5.25%. 

Bank of America Business Advantage Cash Rewards Mastercard One-Time Offer

This card’s one-time offer, of $300, kicks in if you make $3,000 in purchases in the first 90 days after you open its account. That makes the bonus the equivalent of boosting your cash back on those purchases by an additional 10%. 

Rewards Earning Details

This card offers a decent cash back rewards rate, offering 3% in your choice of one of these six categories:

• Gas stations (this is the default category)
• Office-supply stores
• Travel
• TV/telecom and wireless
• Computer services
• Business-consulting services

Dining, meanwhile, earns a respectable 2% in cash back, while all other purchases earn 1% cash back—the typical default rate for most cash-back cards.

Then there are those rewards boosts if you hold a five-figure balance in a Bank of America or Merrill account. Delivered through the Preferred Rewards for Business program, here are the requirements and benefits:

$20,000 to $49,999 on deposit (Gold): Earn 25% more rewards

$50,000 to $99,999 on deposit (Platinum): Earn 50% more rewards

$100,000+ on deposit (Platinum Honors): Earn 75% more rewards

Rewards Redemption Details

Rewards earned with the Bank of America Business Advantage Cash Rewards Mastercard can be redeemed as a statement credit, a deposit into a Bank of America checking or savings account, or as a paper check. 

How to Maximize Your Rewards

Maximizing rewards with the Bank of America Business Advantage Cash Rewards Mastercard all comes down to how you spend. And because the card has tiered rewards rates, depending on category, those total earnings will vary by what you’ve spent, and on what.  

Be prudent about the category in which you elect to earn 3% rewards at any one time, and change the election as needed as your business’s spending changes. If you own a sizable business, be mindful, too, of the combined $50,000 spending cap on earning rewards at the 2% and 3% rewards rates. (If need be, shift any additional spending in those categories to another card that will earn you more than the 1% you’ll receive on purchases beyond the capped amount.)

Finally, consider the institutions where you choose to meet your business’s needs. If you’re carrying at least $20,000 in one or both of your banking and investment accounts, consider moving them to Bank of America and Merrill, respectively. That will allow you to earn at least a 25% premium of your card rewards, along with other benefits of the Preferred Rewards for Business program, which range from loan discounts to reduced rates for payroll services.

Here are two examples of how this card could be leveraged for minimum and maximum rewards. 

Average Case

Let’s imagine you're a sole proprietor running a small business with no other employees. Office supplies are your biggest expense, accounting for $1,000 in spending each month. Assuming you choose that category to receive 3% in cash back, you'd earn $360 in rewards per year. Add in spending of $500 a month on dining and $1,000 on miscellaneous business purchases, and your total cash back for the year would come to $600 ($360 per year at 3% back, $120 at 2% back for dining and $120 at 1% back for all other purchases.) That doesn't include the $300 for the one-time offer you could earn the first three months. 

Aspirational Case

Now, assume that you instead run an LLC with 10 employees. Office supplies are also your biggest expense, although rather than spending $1,000 per month on those purchases you spend $3,000. On top of that, you spend $1,100 per month on dining. Your total cash back for the year on those purchases would total $1,080 and $264, respectively. ($36,000 at 3% cash back, along with $13,200 at 2%). Let’s further say you also carry a total of more than $100,000 in a Merrill business investment account. That balance would also qualify you for the biggest (75%) bonus under the Preferred Rewards program, which would increase your base annual rewards of $1,344 to a new total of $2,352. Those numbers don't include the 1% unlimited cash back you might earn on purchases in those categories above $50,000 in spending or purchases made outside of the bonus categories. 

Bank of America Business Advantage Cash Rewards Mastercard Standard Benefits

• Cash flow management tools
• Travel and emergency services
• Overdraft protection
• Zero liability protection
• Fraud monitoring

Cardholder Experience

Bank of America scored about average in J.D. Power's 2020 U.S. Small Business Credit Card Satisfaction study. Its score of 849 put the card issuer above competitors like Wells Fargo, Capital One, and Citi and significantly below the standouts, Discover and American Express. 

Bank of America business credit card members enjoy online and mobile banking access to manage their accounts. If you need additional help, you can call customer service, schedule an appointment at a local branch or connect with Bank of America via social media. Online chat support is only available for selected Bank of America products. 

Security Features

This card comes with the standard range of security features you'd expect in a business rewards card, including chip technology and fraud monitoring. If your card is used to make fraudulent purchases, you're covered by Bank of America's zero liability guarantee.

While Bank of America offers free credit score access with eligible consumer credit cards, this isn't an included feature of the Bank of America Business Advantage Cash Rewards Mastercard. 

Fees to Watch Out For

The most important fee to consider with this card is the 3% foreign transaction fee. While this is a standard amount you could expect to pay for cards that charge this fee, it's worth noting if you plan to use the card for travel on a regular basis. 

Our Verdict

The Bank of America Business Advantage Cash Rewards Mastercard could be a suitable choice for business owners who want a say in how they can earn maximum rewards. It could also be a good fit for businesses that are looking for more than just a flat-rate cash back rewards card. 

The potential to earn a cash rewards bonus as a Bank of America business banking customer makes it worth considering as well. There are few business rewards cards that could compete with the effective earning potential of 5.25% cash back (assuming you qualify for the 75% bonus by having qualifying deposits with Bank of America or Merrill Lynch) on gas or office supplies, for example. 

On the other hand, you may be better off choosing a different card if your business might outstrip the $50,000 spending cap that applies to the 3% and 2% cash back categories or if you primarily spend on advertising or travel. You might try a card like Chase Ink Business Preferred instead. It offers 3 points per $1 on the first $150,000 in annual combined purchases on travel, shipping, internet, cable and phone services, and advertising purchases made through social media sites and search engines (with a $95 annual fee).