Author: Peter Page 28 / 31

The heavily advertised American Express Business Gold Rewards credit card has a few intriguing features:

• a welcome bonus of 25,000 Membership Rewards points if you spend $3,000 in the first 3 months; convertible to Aeroplan miles, SkyMiles, or Asia Miles. 25,000 Aeroplan points is good for an economy ticket within almost anywhere in Canada and the US.
• annual fee waived for the first year; supplementary cards free for the first year as well
• earn one point for every dollar spent

I signed up for this card for the bonus points and to see what it was like to have an American Express card. A note on applying for a business credit card: if you don’t own a business, you can still legitimately claim to run a business under your own name as long as you have even a small amount of outside income. Even though I own a business, I did not apply for this card under that business name.

Premium service

American Express is known for having the highest-spending users (not me!), relatively high annual fees, and for requiring merchants to sign separate and sometimes exclusive agreements with them. As a result, American Express takes good care of its customers. Three main things stood out to me:

• The application process was easy. You can apply online and the approval process happens either immediately or within about a week if they need to verify any details. Once you’re approved, your card arrives in about another week. Customer service for this process was straightforward and friendly.
• The online management interface is fully-featured and easy to use. Tasks like viewing past statements, signing up for e-statements, viewing spending reports broken down by type of purchase, changing account details, and making account requests are intuitive and accessible.
• Points appear immediately. You don’t have to wait for your next statement for your account be credited with points. Transferring the points to Aeroplan is simple, and sometimes there are even redemption promotions.

As simple as those things sound, many credit card companies and banks fail to achieve such a pleasant level of service.

Extra perks

The main perk that I’ve benefited from is AMEX’s Front of the Line for buying event tickets. For the average person, Front of the Line provides two main benefits: pre-sales access and reserved seating blocks during normal sales. This is quite nice to have, but treat it more like an extra option when looking for seats. Sometimes, using other types of fan pre-sale codes, or buying tickets during the normal sales period early or with good timing luck can yield better seats. Tickets purchased through Front of the Line privileges are sometimes but not always better.

It’s not that widely accepted

I was a bit fearful that American Express would have a low acceptance rate, compared to Visa or MasterCard. For me in Vancouver, Canada, AMEX is accepted at noticeably fewer places, so much so that it has become an annoyance to ask companies whether they accept the card.

Lots of commonly frequented places accept American Express, such as London Drugs, parking machines, major grocery stores, and gas stations. However, I’ve had to use a Visa or MasterCard backup at several restaurants, retail stores such as Swimco, the dentist office, an optician store, and Choices Markets. Also, some online merchants that accept credit card payments through PayPal might not necessarily accept American Express, due to the need to sign a separate vendor agreement. The rate of American Express acceptance at places that I’ve been to that accept credit cards is potentially as bad as 50%.

Annual fee

After the first year of no-fee bliss, the annual fee is $180 for the first card and $50 for each supplementary card.

Aeroplan points

I cannot comment on the value of SkyMiles or Asia Miles, but I do collect Aeroplan points. The value of an Aeroplan point is open to debate, and depends on how you use your points. If you’re looking for an airline rewards card or even just a rewards card, is it worth it to collect Aeroplan points? Consider the following:

• The reward chart is quite general, as it divides routes into broad regions. For example, most long-haul economy flights within Canada and the USA can be had for 25,000 points — you’re getting the most value if you fly from one corner of that area to the opposite corner.
• It’s more worth it to the Aeroplan credit card reward points if you’re also collecting Aeroplan points elsewhere!
• You cannot redeem all of your points at once, so there’s always some left over.
• You still have to pay some airline ticket fees. If you end up redeeming Aeroplan points for a flight that you wouldn’t otherwise have taken, you’re technically spending more and also polluting the earth more!
• The pool of available Aeroplan seats is smaller than the total available seats.

Conclusion

Some areas that I have not touched upon include interest rates and insurance features. These are not very important to me at the moment.

The sign-up bonus is certainly valuable, as is the reward structure. If you’re looking to earn Aeroplan points on an ongoing basis, there are cards from CIBC (such as the Aerogold Visa) with a lower annual fee and that give you more points per dollar spent. Also, there might be some other American Express cards with a more suitable fee + reward calculation structure.

As for rewards in general, I prefer a cash back card such as the MBNA Smart Cash credit card, which has no annual fee. When you get cash back, you can choose to spend it on whatever you want, and you don’t have so much of an issue with leftover points.

The deal breakers for me with the American Express Business Gold Rewards were the annual fee after the first year, and the high percentage of companies that simply didn’t accept it.

And a final note: the shiny gold card is a bit too flashy for my taste! Sometimes I feel that when I bring it out, I’m trying to appear wealthier or more obsessed with status than I actually am…

When searching for a Canadian personal credit card, there are tons of options without annual fees. I can then pick and choose from those options for the one with the best rewards structure.

When it comes to a business credit card, however, the options are a lot more limited. A good place to start is the RedFlagDeals.com credit card directory.

I run a relatively small web development company and 3 of us needed to have credit cards. Mainly, we wanted to simplify the administrative hassle around continuously writing cheques to reimburse our business purchases, which include travel expenses, equipment and supplies, external services, and meals and entertainment. After a rather thorough search, we ended up choosing the CIBC bizline VISA. Here’s why:

No fee

The annual fee for the CIBC bizline VISA is $0. You can have up to 9 additional cards at no extra charge.

No rewards or points

Generally, getting rewards from a credit card is considered beneficial. But after we weighed the fees (no matter how nominal) against the rewards on other cards, it simply wasn’t worth the administrative effort to us. Accounting for the fees and managing and using the points, not to mention any possible taxable benefits coming out of the rewards if awarded for personal use, actually seemed like a cost.

Without rewards, we can keep the purpose of the cards simple and as intended.

Accepted at many places

While American Express has a few tempting cards, for the purpose of putting as many business purchases as possible on a card, VISA and MasterCard are simply safer bets.

Consolidated statements

With the CIBC bizline VISA accout, each cardholder gets his/her own card and card number in his/her name. However, all cards on our account are tracked on the same statement. This contrasted with some other cards we looked at, where each card had a separate statement. We’re small enough that we can quickly tell which charge was by who and for what, and it is administratively easier to only have to deal with one statement.

An added bonus is that the CIBC online interface is quite nice to work with.

You can even break down transactions by type:

Simple application process

You can apply for the CIBC bizline VISA completely online. The process took less than ten minutes for us. It asked for information including:

• Primary cardholder’s address, phone number, date of birth, and income
• Additional cardholders’ address, phone number, and date of birth
• Business information: years in operation, annual revenue, business type, nature of business, primary bank

We received our cards about two weeks later.

When we had previously investigated getting credit cards through our primary financial institution (not CIBC), they wanted us to go into the branch, fill out significantly more information, and do credit checks on all of us. To be fair, that was not the main reason why we went with the CIBC bizline VISA (and we didn’t have anything to hide), but it didn’t help.
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Miscellaneous details

• The CIBC bizline VISA comes with a PIN, which is the first time I’ve ever had a card with a PIN. Extra security, but also an extra number to remember 🙂
• We don’t ever intend on using our cards for actual credit loans, but the interest rate on the card is between 1.5% and 11% above CIBC’s prime rate.
• The card doesn’t include many insurance benefits. However, for things such as travel medical insurance, we use our normal benefits provider.

As a whole, the CIBC bizline VISA is simple and straightforward. Several of us charge our business purchases to it, and we pay it off every month. That’s it.