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The Flagstar Visa Business Bonus Rewards PLUS Card is a small business credit card with a $50 annual fee and a cash back program that rewards all spending equally. It earns 1 Reward Point per $1 spent on all purchases, with no caps or restrictions on how many points you can earn. At the end of each month, there’s an unlimited 50% bonus on all points earned during the previous billing cycle, bumping the effective return on spending up to about 1.5%.

Flagstar Visa Business Bonus Rewards PLUS Card’s other notable benefits include affordable overdraft protection for Flagstar Bank deposit account holders and a 6-month, 0% APR promotion that dramatically lowers the cost of big-ticket purchases and balance transfers for new cardholders. A slew of business-oriented features help users issue free cards to trusted employees, track spending by category and card, and segregate business and personal spending with minimal effort.

That said, this card isn’t perfect.

The sign-up bonus lags behind many competing cards, definitely ‘ and there’s a distinct lack of fringe benefits for business owners who travel often. Many higher-end business cards, including Chase Ink Business Preferred and Business Green Rewards from American Express, are more generous in the travel benefits department.

Still, if you’re in the market for a small business credit card with an easy-to-understand rewards program, Flagstar Visa Business Bonus Rewards PLUS Card is worth a closer look.

Key Features

Sign-up Bonus

Following your first purchase, you get a one-time bonus of 5,000 points. That’s equivalent to a cash bonus of $50.

Earning Cash Back Points

Flagstar Visa Business Bonus Rewards PLUS Credit Card earns unlimited 1 point per $1 spent on all purchases. The earning potential is unlimited: there are no caps or restrictions on the number of points you can earn. However, points expire after five years (60 months). If you don’t use this card often, you need to redeem periodically to avoid losing your points.

Redeeming Cash Back Points

For most redemption methods, the minimum redemption amount is 2,500 points  for most redemption methods – typically a $25 value. You can redeem points for statement credits, direct deposits into checking or savings accounts (third-party or Flagstar), travel purchases, general merchandise, and gift cards offered by dozens of participating restaurants and retailers.

In most cases, including the cash equivalents, points are worth $0.01 apiece at redemption. The notable exception is airfare, which values points at up to $0.014 when you redeem at least 25,000 – in other words, a $325 value on what would normally be a $250 redemption.

No matter how you choose to redeem, using your points wisely can be a great way to save money on a tight budget.

Monthly Bonus on Earned Points

Each month, you automatically receive a 50% bonus on all points earned during the preceding statement cycle. This benefit has no limits. With it, your effective point-earning rate rises to a flat, unlimited 1.5%.

Introductory APR

Flagstar Visa Business Bonus Rewards PLUS Credit Card has a 6-month, 0% APR introductory promotion on balance transfers and purchases. Neither transaction type incurs interest during the promotional period.

Regular APR

Once the introductory period ends, this card’s balance transfer and purchase APR rises to range between 13.49% and 24.49%, depending on your personal creditworthiness and prevailing interest rates at the time of the transition. Going forward, the rate is subject to change with prevailing interest rates (variable).

The cash advance APR is set at 25.49% to start, but can also vary with prevailing rates. The penalty APR is set at 28.99%.

If these rates are too high for you, check out our best low-APR credit cards for better deals.

Important Fees

Flagstar Visa Business Bonus Rewards PLUS Credit Card has a $50 annual fee. Foreign transactions cost 2% to 3% of the transaction amount, depending on how they’re denominated (dollar-denominated purchases incur the lower rate). Balance transfers cost $5 or 3%. Depending on how they’re executed, cash advances cost the greater of $5 or 3% to $20 or 4%. Late payments cost anywhere from $19 to $39, depending on size. Returned payments always cost $35.

Overdraft Protection for Flagstar Bank Deposit Accountholders

If you have a deposit account with Flagstar Bank, you can opt into the institution’s optional overdraft protection transfer service.

With overdraft protection, transactions that would normally result in negative account balances instead trigger cash advances from your Flagstar Visa Business Bonus Rewards PLUS Credit Card’s cash advance credit line. Each transfer is sufficient to offset the negative charge, keeping your balance positive and allowing the transaction to go through as intended. Each transfer costs $10.

Overdraft protection transfers immediately begin to accrue interest at the current cash advance rate, so it’s in your best financial interest to pay them off as soon as possible. Also, this card’s cash advance credit limit is invariably lower than its overall spending limit, potentially precluding very large transfers.

Business Features and Benefits

This card has a nice lineup of business-friendly features and benefits for all cardholders. The most salient include:

• Complimentary employee credit cards
• Up to $100,000 in financial protection against misuse of employee credit cards by terminated employees
• Complimentary online workshops on various business-related topics
• Expense reports that easily separate business and personal outlays
• Spending categorization tools that let account administrators separate expenditures by category and employee card

Visa-Backed Cardholder Benefits

Flagstar Visa Business Bonus Rewards PLUS Credit Card has some non-business cardholder benefits backed by Visa. These include:

• Emergency lost card replacement
• Transportation assistance (and other forms of help) for stranded travelers
• Complimentary extended warranties on certain items with existing warranties
• Purchase protection for 90 days on certain registered items, subject to exclusions and limitations

Credit Required

Flagstar Visa Business Bonus Rewards PLUS Credit Card is designed for business owners with excellent credit. If you’ve experienced serious credit issues such as personal bankruptcy in the recent past, your application will likely be disqualified.

Advantages

1. Unlimited 1.5% Earning Rate. This card earns unlimited 1 point per $1 spent. However, the unlimited 50% point bonus significantly raises the effective point-earning rate to about 1.5%. If you’re looking for an above-average return on your business credit card spending, this is a good place to start.
2. 0% Introductory APR Offer. Flagstar Visa Business Bonus Rewards PLUS Card has a 6-month, 0% APR offer on purchases and balance transfers. If you need to finance a large purchase without accruing interest or execute a balance transfer from an existing credit card account, this promotion can buy valuable time and save you hundreds in interest charges.
3. Good Returns on Airfare Redemptions. When you redeem your accumulated points for round-trip airfare, your points get a value boost of up to 40% – rising from $0.01 apiece to $0.014 apiece. By contrast, competing travel cards such as Capital One Spark Miles for Business typically value points at $0.01 apiece. The catch is that you have to redeem at least 25,000 points at once – a tall order for light spenders.
4. Affordable Overdraft Protection for Flagstar Deposit Customers. Flagstar deposit account customers can take advantage of this card’s affordable overdraft protection transfer service, which costs just $10 per transfer. When the alternative is reneging on your business’s promises and obligations, that’s a very small price to pay. Other banks’ overdraft programs often charge significantly more than $10 per transfer.

Disadvantages

1. Has a $50 Annual Fee. This card has a $50 annual fee. Many competing cash back credit cards with flat, unlimited 1.5% rewards rates eschew annual fees altogether. If you’re looking for a wallet-friendly alternative with comparable benefits, try Chase Freedom Unlimited or Capital One Quicksilver Cash Rewards Credit Card.
2. Has a 2% to 3% Foreign Transaction Fee. Flagstar Visa Business Bonus Rewards PLUS Card has a 2% to 3% foreign transaction fee (the higher rate is for transactions denominated in foreign currencies). If you travel abroad for business often, you’re almost certain to lose money on this deal. Some popular competitors, including Chase Ink Business Preferred, don’t charge foreign transaction fees.
3. Charges Penalty Interest at 28.99%. This card’s penalty APR kicks in as soon as you miss a payment and can remain in force for months, potentially costing you hundreds of dollars if you carry a balance. If your business occasionally faces liquidity issues, consider an alternative without penalty interest.
4. No Bonus Categories or Accelerated Earning Rates. Flagstar Visa Business Bonus Rewards PLUS Card has no bonus categories or tiers, so you can’t boost your point-earning rate north of 1.5% (unless you redeem exclusively for airfare, which values points at $0.014 apiece and bumps the return on spending north of 2%). Still, this isn’t nearly as generous as some competing business cards – for instance, Chase Ink Business Cash Credit Card earn 5% cash back in certain favored categories.
5. Points Expire After 5 Years. Flagstar Visa Business Bonus Rewards PLUS Card’s points expire 5 years after they’re earned. You need to redeem your points every once in a while, even if you’re a very occasional card user, or risk losing your rewards altogether.
6. $25 Minimum Redemption Threshold for Cash Redemptions. You can’t redeem for cash back or any other type of reward until you hit the 2,500-point threshold. For heavy spenders, this isn’t much of a challenge, but it could well stymie occasional users. If you’re looking for a secondary or tertiary business credit card, it’s probably best to look for an alternative with no point-redemption minimums – the Chase Ink cards fit that bill, as do Discover it family cards (though they may be unsuitable for business owners).
7. Sign-up Bonus Isn’t Great. Flagstar Visa Business Bonus Rewards PLUS Card’s $50 sign-up bonus is pretty paltry. After all, it’s only enough to offset the $50 annual fee for a single year. American Express Blue for Business Credit Card’s sign-up bonus is worth up to $100, and the card doesn’t even have an annual fee.

Final Word

Based in Michigan, Flagstar Bank mostly operates in the Midwest and South. The only reason I’m familiar with the company is because I spent a few years in Michigan, where I encountered its branches regularly.

However, Flagstar Bank’s low profile has no bearing on its attractiveness. Flagstar is a solid choice for anyone seeking business, cash back, low APR, and travel rewards credit cards – though, like any financial institution, it’s far from perfect.