All Chase Ink Business Credit Cards Now Offering Very Easy $100 Cash Back

I don't know anyone who doesn't love a cash back credit cards. So today's news is pretty exciting: All the Chase Ink business credit cards now feature a $100 cash back bonus. It's a very sweet benefit, as cardholders qualify for the $100 bonus simply by making just one purchase with a new Chase Ink business card. Sweet.

We've updated all the Chase business credit card application links on the Prime Rate website to ensure that applicants have access to the $100 bonus offer. Click here to select your preferred Ink card and apply.

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Half Glass Full: Business Credit Cards Better Than Ever for Responsible Borrowers

If you perform an internet search on “business credit cards”, you will more than likely return a myriad of results that paint them in a bad light simply because there are no added protections for card holders under the Credit Card Accountability and Responsibility and Disclosure Act of 2009 (CARD). The legislation was designed to protect not-so-savvy consumers who may experience drastic, unexpected interest rate hikes by not-so-honest card issuers willing to take advantage of them. Many business credit card holders were surprised to learn that CARD does not protect them, and so journalists far and wide are shaking their fingers at business credit cards, warning possible applicants against the ‘pitfalls’ of applying for business or “professional” credit cards.

These naysayers are not telling you the whole story.

For responsible credit card users, now is a great time to apply for a business credit card and use the current economic slump to your advantage. The Wall Street Journal reports that after CARD was enacted, credit card issuers mailed out 47 million professional offers in Q1 of 2010, a 256% increase from the same period last year. Why the huge jump? Because business owners are tightening their belts and postponing expansions, causing credit card issuers to lose profits. In a scramble to increase their own bottom lines, card issuers are relaxing certain application criteria for business (or “professional”) credit card applicants and beefing up the card reward programs. For instance, the Ink From Chase business credit card application has been changed to help make approval easier. The same Wall Street Journal article reveals that January 2010 mailings for the Ink From Chase card required applicants to provide the name of their company, the nature of the business, its address and its federal employer identification number. Solicitations in July, on the other hand, only required applicants to check a box that said ‘Yes, I am a business owner’ or ‘Yes, I am a business professional with business expenses.’ A Forbes blog also reports that the Ink From Chase card pays 3% back on fuel, home improvement, dining, and office supplies, as well as 1% on everything else. Small and home business owners are well able to combine personal and business expenses, making this and other similar business credit cards a very attractive option for business and even personal finance.

So, despite the lack of added protection by the Credit Card Accountability and Responsibility and Disclosure Act (CARD), these new and improved professional and business credit cards with expanded rewards programs can actually prove to be advantageous for the right kind of card user.

But who is that, exactly?

If you have a good credit score, pay your balance off every month, and do not usually incur late payment fees, the current economic climate has blown the winds of opportunity in your direction. Since the lack of added consumer protection in CARD only affects credit card users who tend to carry balances and are at times delinquent in their payments, these penalties are not a major source of concern for business owners who are conservative in their spending, keep good records, and pay off their credit card bills by the end of each month (at least most months). Getting a new business credit card now, while issuers are still looking to woo new applicants, can help build your business credit score and set you up nicely for the time when banks begin offering better business loans and you are ready to expand.

Don’t let the mainstream media tell you that this glass is half empty - it’s really half full.

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Senator Chuck Schumer Is Mad at Credit Card Banks

I love my business credit cards. I've got 3, including a new one from Chase. Building my business's credit history is very important, but I also find the purchase protection very useful, as well as the way business cards make it easy for me to keep my personal and business spending completely separate.

It's so easy to vilify credit card banks for some of the sneaky tactics they sometimes employ to generate revenue via fees and interest. However, I know from extensive experience that if you use credit wisely, avoid carrying a high balance, and pay your bills on time, every time, chances are you will have few if any complaints about your credit card bank.

Moreover, I've been to many different parts of the world, and I've seen how difficult or expensive it is to get credit. I'm quite thankful for the easy credit that I enjoy as an American. For proof, all one has to do is step over our southern border and try to get a loan or credit card with a decent interest rate and fair terms. Good luck!

Credit card banks send out lots of mailings; lots of offers for both consumer and business credit cards. Many recipients of these mailings don't do what they know they're supposed to do, i.e. reads the terms and conditions associated with these offers. Sometimes a credit card offer looks like an offer for a consumer card, but is in fact an offer for a "professional" card. The difference is important, because a professional card is actually a business card, which means it's not covered under the Credit Card Accountability Responsibility and Disclosure Act of 2009 (a.k.a the Credit CARD Act of 2009.)

Senator Chuck Schumer is mad at the credit card banks because they've allegedly started pushing professional cards, a lot. Here's a clip from the Senator's website:

"...U.S. Senator Charles E. Schumer (D-NY) today expressed alarm about a new tactic credit card issuers may be using to evade last year’s milestone credit card law, warning that card issuers are increasingly pushing consumers into signing up for corporate cards that are not subject to the law’s protections. In a letter to the Federal Reserve, Schumer pressed for a crackdown on this potentially abusive practice so that unsuspecting consumers are not lured by card offers intended to circumvent the law passed by Congress.

'Credit card companies seem to be purposely hawking corporate cards to consumers who don’t own a business and may even be retired. This is more than deceptive marketing; it is a dirty trick meant to get around the new credit card law. We need to put an immediate stop to this scheme, but in the meantime, consumers should be sure to read the fine print of the offers they are getting in the mail. This is the latest, most brazen attempt yet by the credit card industry to get around the law,' Schumer said.

Last year’s credit card law, signed by President Obama, imposed a host of reforms on consumer credit cards, such as a ban on rate increases in the first year of a cardholder’s agreement and a requirement that the card issuer provide 45 days notice before a rate increase can be assessed in later years. But these reforms are not applicable to corporate, or professional, cards – which are intended for use by small business owners.

Not coincidentally, credit card companies appear to now be marketing these corporate cards more widely, to ordinary consumers who don’t own a business and may even be retired. According to a market research group Synovate, mailings for corporate cards increased a whopping 256 percent in the first quarter of 2010. Average consumers are unwittingly signing up for the cards without realizing they are not covered by the stronger rules governing personal credit cards. In fact, the card companies appear to be playing to that confusion in the application materials for these corporate cards. A published report last week noted that an application form recently issued by one major card company no longer includes a section seeking detailed information about the potential cardholder’s business. Instead, the application merely requires a box to be checked indicating 'Yes, I am a business owner' or 'Yes, I am a business professional with business expenses.' This simplified application could easily prevent a card applicant from realizing the nature of the card they are signing up for..."

Ok, and here's Senator Schumer's proposed remedy:

"...In response, Schumer proposed today in a letter to Federal Reserve Chairman Ben Bernanke that card companies be required to solicit and verify an applicant’s federal tax identification number before approving a corporate card application. This way, Schumer said, the card companies would no longer be able to trick an ordinary consumer into signing up for a card that is not covered by the new credit card law..."

Here's what I propose: The Business Credit Card Accountability Responsibility and Disclosure Act of 2011. Why 2011? Because you know how long it takes for Congress to work things out.

Here's another idea: have the Federal Reserve put new rules in place that restrict credit card banks from engaging in anything that is obviously unfair with regard to business credit cards. They have the power to do it. They did it with consumer credit cards earlier this year.

Remember to read those terms and conditions carefully. If you signed up for a professional card thinking that you were signing up for a consumer card, just cancel the account. Lots of of credit card banks are very eager to get your business, so it's really no big deal, in my opinion. I wasn't born rich, and I need access to credit to run my business. I'm very happy to see plenty of competitive offers continue to stream into my snail-mail box. Credit is good. Competition is good. It's a great country.

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Bank of America Clarity Commitment Summary.

Yesterday, I got a letter from Bank of America (BofA). I have two business credit cards issued by BofA. The letter is a Clarity Commitment Summary, and it begins, "Bank of America values its Small Business customers..." To be perfectly honest, when I read something like that in a letter from a credit card bank, I readily dismiss it. But, based on my experience with BofA, I actually said to myself, "yes, I believe you" when I read this. Here's why:

• During the worst of the banking crisis and subsequent Great Depression, American banks cut back on all types of financial products, including credit cards. Accounts were closed, credit limits were slashed and interest rates were hiked. Citibank closed an inactive business card I had with them, then Chase forced me to close my Chase business card as I would not agree to a change in terms: a rate hike from 9.9% fixed to a variable rate of Prime + 11.99%. As for my Advanta card: that credit card bank closed all their small business credit card accounts about a year ago.
  
  Bank of America didn't cut the credit limit on either card I have from them. They didn't raise my APR or close either account, even though one account has been inactive since I got it back in 2007.
  
  
• A few months ago, I messed up. I missed a payment on my active BofA business card. I was hit with a $45 late payment fee, and my account was suspended (account was still open, I just couldn't make any new charges until I made a payment to cover 2 billing cycles.) I called the bank and explained that I had setup "scheduled payments" in advance, but one can only do this for up to a year into the future. I didn't realize that a year had passed since I setup the scheduled payments, and I needed to setup a whole new set. My mistake could have cost me dearly, but it didn't. After waiting on hold for 12 minutes, the BofA customer service rep' (CSR) removed the late fee and lifted the suspension. He thanked me for being a valuable Bank of America customer (my payment record was spotless up until my scheduling blunder) then told me that I should try setting up automatic payments instead of scheduling. With automatic payments, one can setup a certain amount to be paid each month on an account's due date, and not have to worry about scheduling anything else.
  
  I explained that had tried setting up automatic payments a long time ago, but was only able to do so with my personal Bank of America credit card. When I called for help back then, I was told that there was a glitch and that I should be able to setup automatic payment with my business cards within a few days. I should have stayed on top of BofA's progress with fixing the glitch, but I instead opted to use scheduled payments. Do I have automatic payments setup for my business credit cards now? Of course!
  
  How often do you read about a bank being so cool about a missed payment? No interest rate hike, no reporting to the credit bureaus. Absolutely no adverse action taken on the part of BofA. Kudos.

The Credit Card Accountability, Responsibility, and Disclosure (CARD) Act of 2009 does not include any new protections for business credit cards. However, Bank of America has decided to apply some of the most significant protections from the CARD act to the business cards I have with them. Here's a list from my Clarity Commitment Summary letter:

• We will no longer increase your rate on existing balances for late payments or other risk reasons.
  
  
• We will always provide 45 days notice before we increase your rate for future balances.
  
  
• Any amount you pay over the minimum payment will now be used to pay down your balances with highest APR's first.
  
  
• We will no longer charge a fee for going over your credit limit.
  
  
• Your payment due date will now be at least 25 days from the statement closing date printed on your statement.

Again, Bank of America deserve a hearty pat on the back for adding a lot more value to their business cards. I'm sure that other credit-card banks will eventually follow suit, which is great. But BofA should be commended for taking the lead.

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No Rate Hikes On Existing Balances for Bank of America Business Cards

As a Bank of America business credit-card account holder (I actually have 2 business cards from BofA) I was very happy to read today's news: No rate hikes on existing credit-card balances. Here's a clip from a recent Charlotte Observer article:

"...Bank of America Corp. won't raise interest rates on existing balances held by its 2 million small-business credit-card accounts, the bank said Thursday.

The bank also said that those customers will get 45 days' notice before rates change on future balances. It won't charge fees when customers go over their credit limit.

Small-business credit-card customers will also receive a one-page "Clarity Commitment," which is a summary of their rates, fees and payment information. The bank has already sent such statements to customers with mortgages, home equity loans and consumer credit cards..."

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What’s Next For Small Business Credit Cards?

During the past twelve months we have seen a paradigm shift in small business lending to say the least. Once a staple of the industry, small business credit cards are now a rare find. As previously reported on this blog, banks left and right have been terminating business cards; including Advanta, Chase, and Citi. Many cardholders have also complained about higher interest rates and lower credit limits.

What’s Next?
Although there is some dispute as to whether or not the recession is over, there’s no denying that economic conditions have significantly improved since last winter. According to the United States Commerce Department, the U.S. economy grew 3.5% during the third quarter. Positive GDP growth has also been reported by some other countries, with China leading the way so far at 8.9%. If economic conditions continue to improve, we most likely will see business credit cards trickle back onto the market.

What Will Be Different?
It’s important to note that business cards are currently excluded from the Credit Card Reform Act of 2009. Therefore, it's possible we may experience the same "bait-n-switch" complaints on credit card deals in the future. That being said, due to increased scrutiny and regulation of the industry, these questionable practices will likely become far less common.

It is also likely that new cardholders won’t be granted high credit limits, at least initially. Before the economic turmoil erupted, many new customers were given extremely high limits; often in the tens of thousands of dollars. For now, it is unlikely we will see these same spending limits awarded to new accounts.

Furthermore, applicants with lower credit scores will probably not be approved. We may even see business credit card deals explicitly mention they are only seeking those with excellent credit profiles.

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Advanta Settles with The FDIC Over Fair Trade Violations

Here's some good news for all those who used to have an Advanta business credit card account. As you may already know, Advanta shut down all business credit cards accounts on May 30, 2009. No account was spared. Small business owners who relied on their Advanta credit cards to buy equipment, inventory, etc. were forced to find new sources of temporary financing in a hurry. This, of course, made lots of cardholders very angry, since business credit cards and lines of credit are not easy to find in the current credit crunch and recessionary economic environment.

To add insult to injury, Advanta also raised the interest rate on many accounts without providing fair warning. This happened with my own Advanta Platinum Businesscard account. Advanta ended my 0% intro APR period early, and without warning. Moreover, I'm still calling Advanta every week, as I'm trying to resolve a problem with an opt-out correspondence. All very vexing stuff.

So here's the good news: Advanta has settled with the Federal Deposit Insurance Corporation (FDIC) over fair trade violations related to business credit card accounts. Bottom line: if Advanta modified your interest rate without fair warning, you may eventually receive a restitution payment.

Here's a clip from Wednesday's press release:

"...Under the settlement, Advanta has agreed to an order to cease and desist, to pay restitution, and to pay a civil money penalty in the amount of $150,000. In addition, restitution of approximately $14 million will be paid to businesses that used Advanta's Cash Back Reward program and $21 million to accountholders whose accounts were repriced. In agreeing to the issuance of the order, Advanta did not admit or deny any liability.

Advanta's 'Cash Back Reward' program advertised a percentage of cash back on certain purchases by business credit card accountholders. Due to the tiered structure of the cash back payments, however, the advertised percentage was not available for all purchases. As a result, it was effectively impossible to earn the stated percentage of cash back reward payments. The FDIC concluded that the Bank's solicitations were likely to mislead a reasonable customer and that the representations were material and that therefore, the Bank engaged in a pattern of deceptive acts or practices in violation of Section 5.

In addition, numerous complaints were filed regarding Advanta's substantial annual percentage rate (APR) increases on the accounts of small business owners and professionals, who had neither exceeded their credit limits nor were delinquent in making payments on their accounts. The FDIC determined that Advanta's rate increases had been implemented in an unfair manner, that Advanta failed to adequately notify accountholders that their APR had increased, the amount of the increase, the reason for the increase, the procedures to opt-out and the consequences of an opt-out. The repricing caused substantial injury to customers, withheld and/or provided inadequate information that could have enabled the customer to reasonably avoid the injury, and provided no benefit to the customer or competition.

'The Advanta settlement demonstrates the FDIC's commitment to having banks take responsibility for ensuring that they do not engage in unfair or deceptive acts or practices in connection with the banking products and services they offer,' said FDIC Board member Thomas J. Curry. 'Any person doing business with an insured depository institution can expect to be treated fairly, and any such entity that engages in unfair or deceptive acts or practices should be aware that the FDIC will pursue such practices with all of the legal authority at our disposal.'..."

OK, so here's an example of one of the worst credit cards ever:



Yup.

I now pose this question to readers: is Advanta the worst business credit card bank ever? As always, your comments are very welcome, and appreciated.

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