The news: U.S. Bank launched two credit cards for small business owners, per a press release.

• U.S. Bank Business Essentials Visa has no annual fee and offers 2.5% back for cardholders with business checking accounts.
• U.S. Bank Business Essentials Plus Visa Signature has a $295 annual fee. It offers 3.5% back for cardholders with business checking accounts and 5% back on cardholders’ top spending category.

Jessica Alba will represent the portfolio as its spokesperson. 

How we got here: SMB card solutions have significant growth potential. 

• Nearly 40% of SMBs report not being able to access the working capital that they need via cards, per NSBA’s Small Business survey. 
• And an average SMB monthly credit card spending has doubled since 2020 to $23,000 in 2024, per the National Bureau of Economic Research. 

Attracting SMBs with rewards-laden credit cards also gives issuers a chance to secure deposits through connected rewards.

Fintech competitors have had the same idea: Square refreshed its credit card program, offering 3% back on all payments made through Square Bill Pay and 1.5% back on everything else. It also offers merchants savings accounts at 3.5% APY and enhanced lending opportunities to convince more SMBs to choose all-in-one banking and payment services through Square.

Implications for issuers: If banks don’t snag SMB owners’ attention with strong rewards and marketing, they risk losing payments volume and deposits to fintechs with similar ambitions.

Strong rewards can help pull in sign-ups and ward off fintechs that don’t have the margins to compete. 

Issuers should also incorporate competitive lending, liquidity management, and payment flexibility into their portfolios: 

• 56% of SMBs are very or extremely interested in a card that lets them choose between rewards or lower APRs each statement period, per a PYMNTS Intelligence report.
• 54.9% want payment due dates tailored to their businesses’ specific liquidity needs.
• And 52.4% want a card that can flip between credit and installment payments.

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