August 11, 2022

For Start-Ups Without a Credit Score

Select’s editorial team works independently to review financial products and write articles we think our…

For Start-Ups Without a Credit Score

Select’s editorial team works independently to review financial products and write articles we think our readers will find useful. We earn a commission from affiliate partners on many offers, but not all offers on Select are from affiliate partners.

Henrique Dubugras and Pedro Franceschi first came up with the idea for Brex when they participated in Y Combinator, a tech start-up accelerator. While their original idea was to build a virtual reality company, they quickly realized how difficult it was for start-ups and small businesses to secure financing from traditional banks.

Instead, they created Brex, a business credit card that didn’t just consider credit scores for approval but also looked at how much money a business has raised, its existing cash balances and its revenue.

Looking at these different metrics when determining a company’s eligibility for a card makes Brex stand out. For example, if you run a start-up, Brex will consider how much cash your business has on hand. If you have an e-commerce business that’s low on cash because you have to constantly buy inventory, Brex will focus on your revenue. If your company doesn’t have revenue and hasn’t raised cash, Brex will check credit scores.

Brex also happens to be one of the few business cards that doesn’t require a personal guarantee, meaning business owners aren’t personally responsible for any debt they can’t pay off that’s been racked up on the card.

While Brex initially started as a corporate credit card for start-ups, it has since expanded its target customer to include small and large businesses, with a specific focus on e-commerce firms like ClassPass and SoFi.

Below, Select explores the different types of Brex credit cards, their rewards and other business cards available on the market to help you decide if Brex is a good fit for you.

Brex Business Card review

Brex Business Card

Pros

  • No personal credit check to qualify
  • No annual fee
  • No foreign transaction fee

Cons

  • You’ll have to pay off the balance daily or monthly

*Offer available to new Brex Card customers only.

The Brex Mastercard® Corporate Credit Card is issued by Emigrant Bank, Member FDIC. Terms and conditions apply. See the Brex Platform Agreement for details.

Brex Treasury LLC is an affiliated, SEC-registered broker-dealer and member of FINRA and SIPC that provides Brex Cash, a program that allows customers to elect to sweep uninvested cash balances into certain money market mutual funds or FDIC-insured bank accounts at program banks. Maximum FDIC insurance of $250,000 per program bank. Investing in securities products involves risk, including possible loss of principal. Brex Treasury is not a bank and your Brex Cash account is not a bank account.  Wire transfers, both inbound and outbound, are free to send for Brex Cash customers. For customers sending wires, the recipient’s financial institution may charge a fee upon receipt of the wire. Please see brex.com/cash for important legal disclosures. Past performance is not necessarily indicative of future results.

Types of Brex Cards offered

Brex offers two types of no annual fee corporate cards: a credit card that is paid off daily and a credit card that is paid off monthly. Brex isn’t just a credit card — it also includes a cash management account called Brex Cash that’s available to all companies using a Brex Card and is required for companies using the specific Brex card that is paid off daily.

Brex Cash acts like a business bank account, with no fees, minimum balances or limits to worry about. If you invest money in a Brex Cash account, it’s protected for up to $500,000 by the Securities Investor Protection Corporation (SIPC) although it’s not FDIC-insured. As a result, Brex will deposit your cash in a partner bank or a government money market mutual fund.

Both corporate cards that Brex offers are charge cards, which require cardholders to pay off their balance in full whenever payments are due. Unlike traditional credit cards, you won’t be able to revolve your balance.

The Brex Card that is paid off daily works similarly to a debit card. Purchases are deducted from your Brex bank account daily and you’re only able to spend the amount of money that’s currently available. This particular card is available to businesses of any size.

The Brex Card that’s paid off monthly requires companies to meet certain size and revenue qualifications. You can pay off your balance using any bank account and will be eligible for a higher credit limit, even if it’s more than what’s currently available in your bank account.

Brex is also able to extend credit limits up to 10 to 20 times higher than those offered by traditional credit cards because of real-time underwriting. While traditional business credit cards require that an individual be able to pay off the balance in the event of bankruptcy, Brex regularly monitors the bank accounts of business owners to adjust the credit limit based on the user’s available cash balances and revenue, which minimizes the risk of a business defaulting on their card.

Welcome bonus

Brex is currently offering new cardholders 10,000 Brex points after spending $1,000 with their Brex Card, plus an extra 10,000 points after spending $3,000 within three months of opening an account. Those who link payroll to their Brex account within three months can earn another 20,000 points on top of that.

Benefits and perks

Brex offers a number of useful features for businesses, including integration, expense management and instant payouts, letting businesses that use vendors or payment processing networks such as Amazon, Square, Stripe, PayPal or Shopify to receive revenue instantly instead of having to wait seven to 14 days.

You’re also able to utilize vendor-specific credit cards with Brex, meaning you can use different cards for different vendors. As a result, in the event that one card becomes compromised, you won’t have to worry about it affecting any of the others.

There’s no limit on the number of Brex Cards that are available to a business, so if a company wants a credit card for each of its 5,000 employees, it will receive 5,000 credit cards.

Brex also offers an expense management product, allowing business owners to easily keep track of employee, vendor and general expenses. It also helps companies identify excess spending with features like receipt matching — employees can take photos of their receipts and send them to Brex, which then matches them against lists of expenses and consolidates that information within the platform.

With the Brex Card, you’ll have access to benefits associated with the World Elite Mastercard® for Business program, including the following perks:

How to earn and redeem Brex points

Earning Brex points:

Cardholders earn Brex points that never expire, although the points-earning rates for each card are slightly different. Those with the Brex Card that’s paid off monthly will receive one point less in most of the spending categories, for instance, 7X points on ride-share services, 4X points on travel booked through the Brex Travel portal. Here’s the breakdown for the Brex Card that’s paid off daily:

  • 8X on ride-share services
  • 5X on travel booked through the Brex travel portal
  • 4X on restaurants
  • 3X on eligible Apple purchases made via the Brex Rewards portal
  • 1X on all other purchases

Plus, if your business is part of the technology or life sciences industry, you’ll earn more for spending categories that are specific to your industry, such as 3X points on recurring software (technology) or 8X points on conference tickets and 2X points on lab supplies (life sciences). If you have the Brex Card that’s paid off monthly, you’ll get 2X points on recurring software (technology) and 7X points on conference tickets (life sciences).

Redeeming Brex points:

Brex points can be redeemed through the Brex Travel portal, as well as for gift cards, statement credits or airline miles through one of its eight travel partners including Aeromexico, JetBlue, Avianca, Qantas, Singapore Airlines, Air France KLM, Asia Miles and Emirates. You can also redeem Brex points for bitcoin or ethereum cyptocurrency by creating a virtual wallet, which acts like a bank account, in order to redeem and deposit it.

Rates and fees

Card comparison

While there are number of other corporate cards available on the market, there aren’t too many without an annual fee. Many of the other cards also use traditional underwriting methods, so you’ll need to have either a good or an excellent credit score in order to qualify.

The Capital One Spark Cash Plus Credit Card is a good choice if you want a charge card that gives a 2% flat cash-back rate on all of your purchases. There is a $150 annual fee, but like the Brex Card, it comes with useful features for business owners, such as account management tools.

Capital One Spark Cash Plus Credit Card

Information about the Capital One Spark Cash Plus Credit Card has been collected independently by Select and has not been reviewed or provided by the issuer of the card prior to publication.

  • Rewards

    Unlimited 2% cash back on every purchase

  • Welcome bonus

    Earn up to a $3,000 cash bonus: $500 once you spend $5,000 in the first 3 months, and $2,500 once you spend $50,000 in the first 6 months

  • Annual fee

  • Promo APR

  • Regular APR

    No APR; pay off your balance in full every month to avoid a 2.99% late fee

  • Balance transfer fee

  • Foreign transaction fee

  • Credit needed

The Business Platinum Card® from American Express

On the American Express secure site

  • Rewards

    Earn 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com and 1X points for each dollar you spend on eligible purchases. Also, earn 1.5X points on eligible purchases at US construction material & hardware suppliers, electronic goods retailers and software & cloud system providers, and shipping providers, as well as on purchases of $5,000 or more everywhere else, on up to $2 million of these purchases per calendar year.

  • Welcome bonus

    Earn 120,000 Membership Rewards® points after you spend $15,000 on eligible purchases within the first 3 months of card membership

  • Annual fee

  • Intro APR

    0% Intro APR for 12 months from the date of the account opening on purchases eligible for Pay Over Time

  • Regular APR

  • Balance transfer fee

  • Foreign transaction fee

  • Credit needed

Who the Brex Card is best for

Bottom line

For rates and fees for the Business Platinum from Amex, click here.

Information about the Brex Credit Card, Brex Cash and Capital One Spark Cash Plus has been collected independently by Select and has not been reviewed or provided by the issuer prior to publication.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.