Spark 1% Classic review: Decent option for building business credit

If you can afford to tie up a minimum of $1,000 in a security deposit, the Bank of America® Business Advantage Unlimited Cash Rewards Secured card* is one of the few secured business cards to offer rewards. It has a higher cash back rate of 1.5 percent compared to the Spark 1% Classic card and doesn’t charge a penalty APR for late payments. If you are struggling to get approved for  unsecured cards, it’s definitely worth considering if you want to earn rewards while you build credit.

If your credit score is closer to the “good” range (670 or higher) and you’re interested in travel rewards, you may want to consider The Blue Business® Plus Credit Card from American Express. It’s a no-annual-fee card offering a flat rate of 2X Membership Rewards points on everyday business purchases up to $50,000 per year (1X points thereafter). 

To get the best value, you’ll want to redeem your rewards for travel. Points are worth up to 1 cent when booking travel through the Amex portal and could go even higher if you transfer your points. According to Bankrate’s latest valuations, Membership Rewards points are worth around 2.0 cents on average when redeemed with Amex’s transfer partners. The Spark 1% Classic is meant to improve your credit, so once you do, you’ll want to consider better options such as the Blue Business Plus.

The Spark 1% Classic is geared towards business owners with fair credit, meaning a FICO Score of 580 or higher is recommended.

Yes, if your credit score improves enough to qualify for a better business credit card with Capital One. You can call after you’ve had the card for several months and ask for your account to be reviewed and considered for an upgrade.

Yes. Unlike other business cards and issuers, Capital One reports all activity on business cards to your personal credit report. They also perform a hard credit inquiry with all three credit bureaus, which can temporarily lower your credit score.

The best business cards offer rewards in key business spending categories, so a primary factor in a business card’s rating is its rewards value. This includes the card’s average rewards rate, estimated annual rewards earnings, sign-up bonus value and reward redemption value. 

To estimate a business card’s average annual rewards earnings, we first calculate its average rewards rate based on how much it earns in different bonus categories and how closely its categories align with the average small-business owner’s spending habits. In other words, we assess whether the card earns rewards at a high rate in the most popular business spending categories.  

We researched 10 key business spending categories including dining, gas, office supplies, travel, telecommunications, insurance and more to get a sense of the average small-business owner’s spending habits. We assumed an average annual spend of around $40,000 per year based on Bankrate survey data. 

Using this data, we are able to assign a weighting to each of a card’s bonus categories. We also estimate the redemption value of points or miles from various issuer, airline and hotel rewards programs.

This weighting and rewards valuation allows us to estimate a card’s average annual rewards earnings — how many points or miles you’d earn with a given card if your spending was about average and you used the card for all of your business purchases — as well as what those points are worth. We also use point valuations to determine a card’s sign-up bonus value.

With these calculations complete, we assign each card a score based on how its average rewards earnings, sign-up bonus value, rewards rate and redemption value stack up against other business cards, factoring in the card’s annual fee.

The better these values, the higher its score will be, making it more worthy of inclusion in our list and increasing its potential ranking.

We also score business cards based on how much it costs to keep them in your wallet or carry a balance.  

To start, each business card is scored based on whether it offers an intro APR and how its ongoing APR compares to the rates available on other business cards. This is because an intro APR on new purchases or balance transfers can be a lifesaver if you need to pay down debt, finance a large business purchase or free up cash flow. 

While intro APRs are not uncommon on business cards, they aren’t a given, so cards that offer this sort of payment flexibility will score higher in our card rating system.

Even more important to both a card’s score and its inclusion in our list, however, is how its annual fee influences its overall value. We consider a card’s annual fee in two ways — how it ranks relative to the fees you’ll find on other cards in the category and how it impacts a card’s overall rewards value. 

Cards with an annual fee will always be at a slight disadvantage in our scoring system since annual fees inherently cut into your rewards value. However, if a card offers terrific value via its ongoing rewards and perks, it can earn a high score and a spot in our list even if it carries a high annual fee. 

With this in mind, we rate a card based primarily on how its ongoing rewards value and ongoing perk value (such as annual credits or bonuses) stack up against those of other cards in the category when you subtract annual fees.

We rate each business card’s flexibility based on the restrictions it imposes on earning and redeeming rewards. 

Flexibility factors include whether a card only allows you to earn a high rewards rate on only a small amount of spending or requires you to meet a certain earning threshold before you can redeem rewards. We also examine whether your points are worth less when you opt for some redemption options over others and whether a card gives you the flexibility to transfer rewards to travel partners. 

We also score each card’s set of features – its perks and benefits — against five tiers of features to provide a rating. Top-tier perks include benefits like airport lounge access, travel credits, elite status with an airline or hotel and credits for expedited security screening membership programs.

We give extra weight to perks especially useful or valuable for small-business owners, like being able to qualify with no personal guarantee, digital advertising credits, free employee cards and accounting perks.