The days of building up reserve miles from business travel might be temporarily paused, but that doesn’t mean businesses aren’t sitting on rewards that can be used to benefit their operations in other meaningful ways.
Research shows U.S. businesses with monthly expenses greater than $10,000 had only enough cash on hand to last two weeks. For cash-strapped businesses struggling to find ways to keep their doors open — or reopen after not having earned revenue for some time — credit card rewards points could be a savvy strategy.
Unsure about how to redeem those points to provide the biggest benefit for your business? Here are some ideas.
1. Cover COVID-19-related costs
There’s no doubt that businesses have to assume extra costs to operate during the pandemic. These costs can range from additional cleaning supplies and personal protective equipment for staff to the cost of social distance barriers and extra signage. Many businesses are struggling to deal with these costs while some are passing them on to consumers as an added “COVID fee.”
Another option is to purchase some of your necessary equipment using credit card rewards. For example, if you’re a restaurant needing extra patio furniture to move your dining outdoors, you might be able to find some of the furniture available to purchase with rewards points, leaving the cash in your business accounts for other operating expenses such as rent or payroll.
2. Redeem your cashback rewards
Statistics show cashback cards are the most popular type of rewards cards across all generations, with 78% of millennials, 68% of Gen Xers and 77% of baby boomers preferring cashback rewards to other incentives such as airline rewards or hotel stays.
Not all cashback cards work in the same way. Some automatically deposit your cash rewards into a linked account while others apply the reward to your statement. Sometimes a credit card company will even mail you a check with your reward total.
If your card does not have automatic cashback redemption, you’ll want to contact their customer service center to redeem your rewards. If you choose to have this money deposited directly into an account, you’ll be able to turn around and use that for any immediately necessary purchases.
You could also designate the entire amount toward paying your credit card balance, giving you more room on your business credit card to continue earning points. However, if your credit cards are maxed out, remember there is a chance your credit card company could lower your maximum limit. If you opt to get a new cashback card to help with expenses, be sure to compare cards online to feel confident you are getting the best deal out there.
3. Purchase gift cards
If your credit card does not offer cash back, or if you can’t find anything helpful to redeem for points, consider using your points to purchase a gift card. Many brick-and-mortar retailers, and online stores such as Amazon, have gift cards available to purchase with credit card points. If your business is struggling to afford hard goods, purchasing gift cards could be a solution.
A gift card could be particularly helpful for businesses searching for affordable PPE, as items like masks and hand sanitizer can be purchased on Amazon.
4. Donate to a charity
If your business has been faring well during the pandemic, you may not be in need of emergency cash, but that doesn’t mean your business credit card rewards points have to languish unused. You can turn them into a charitable donation — something that could help your community and significantly increase your own employee satisfaction.
Statistics show that corporate social responsibility programs can increase employee productivity by 13% and reduce turnover by 50%. Placing an emphasis on corporate giving at a time when many Americans are struggling could speak volumes to your employees about your values. Plus, you could even consider getting your employees involved in the decision about where the rewards points should go to help drive engagement.
If you’re thinking about donating your points to a charity, create a shortlist of charities that you know your team is passionate about. Then, you can hold an anonymous poll to decide collectively where your points will go. Alternatively, you could consider creating a selection committee that will evaluate worthy charities and select one that best represents your business.
Don’t let your points expire
Credit card rewards points do expire, so be sure to verify the rules with your specific credit card company. You might be able to keep your points active by using your credit card at certain intervals or you might find that you have to redeem your points by a cutoff date.
Either way, getting creative about how to best use your credit card points to benefit your company right now could be one extra tool that helps your business make it through the pandemic.