Earlier this week, Bank of America introduced of a suite of three small business charge cards. Up to now, Bank of America has only issued small business credit cards.
This new suite will compete in the small business charge card space with leader American Express, as well as Chase, which now issues an Ink Bold charge card as part of its Ink small business card suite.
This new charge card suite will also compete with small business credit cards. Leading small business credit card issuers retrenched significantly following the financial crisis in the second half of 2008. Since then, some leading issuers have returned to the market, but small business cards are now marketed less as sources of working capital, and more as payment vehicles. And there is significant spending growth potential for small business credit and charge cards, as card’s share of overall small business spending is much lower than card’s share of consumer spending.
Marketing such cards also enables issuers to maintain relationships with small business customers, who can then be cross-sold additional products and services, including lending products as confidence returns to the market.