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Miles business credit cards can be useful for frequent travelers, while cash back may be more advantageous for businesses seeking uncomplicated and valuable rewards.

In this article, we’ll compare miles and cash back credit card rewards programs so that you can choose the best option based on your spending habits.

Miles vs. cash back rewards

Cash back Miles
Types of rewards Statement credit, check, direct deposit Airline miles, hotel points, flexible points
Suitability for daily spending Excellent for everyday purchases Great for frequent travelers
Reward rate consistency Consistent earning rates for purchases Variable rates for spending categories
Expiration of rewards Rarely expire May expire if not used
Good credit score required Varies Usually requires a good credit score
Annual fee Usually has no annual fee Usually has an annual fee

Cash back credit cards

Cash back credit cards work by giving you a portion of the money you spent on your card back in the form of cash. If your card offers 1% cash back rewards, for instance, you’ll receive 1% of the total amount you spend as cash back. You can opt to receive cash back by check, direct deposit into your bank account, or as a monthly statement credit toward your card balance.

The nature of this type of credit card makes it easy to calculate how much you’ll earn, as compared to points-based rewards, which can be trickier to translate into cash value. Unique to cash back cards is their potential to serve as a budgeting tool, directly reducing monthly expenses or accumulating savings. This means that using your card saves you money, rather than encouraging spending to accumulate miles or points.

Pros of cash back:

  • Straightforward: It’s easy to calculate the real value of cash back rewards.
  • Flexibility: Cash back often applies to all categories of purchases, rather than only certain purchase types.
  • Resistant to inflation: While points-based rewards can decrease in value as prices rise, cash back rewards increase proportionately to inflation.
  • Easier accounting: Cash amounts can be directly credited, while miles come with valuation and conversion challenges.

Cons of cash back:

  • ‍Lower rewards: Cash back programs often offer lower rewards rates than other credit cards.
  • Reward caps: Some cash back cards cap your cash back rewards after a certain spending amount.  

Miles credit cards

Miles credit cards offer a certain amount of airline miles on card transactions, which can then be redeemed for travel rewards like flights, hotel nights, and rental cars. These cards generally offer higher rewards on travel than cash back credit cards, which can be useful if you’re a frequent flyer.

The value of miles varies across cards and the method in which you redeem them. For instance, miles are generally worth more when redeemed for travel rewards vs. shopping, cash, or gift cards. Some miles credit cards allow you to transfer your miles to different airline and hotel partners who offer higher value per mile.

Types of miles reward programs

There are three types of miles reward programs:

  • Airline credit cards: Airline credit cards are directly tied to specific airlines, allowing you to earn miles on purchases that can be redeemed for flights, upgrades, and sometimes other travel benefits with that airline and its partners. They often include brand-specific perks like priority boarding and free checked bags. The rewards value of miles on these cards is highest when flying with the associated airline.
  • Hotel credit cards: Hotel credit cards partner with specific hotel chains, offering rewards points for stays and purchases within the hotel network. Cardholders can get benefits like complimentary room upgrades, late checkout, and annual free night stays.
  • General travel rewards credit cards: General travel rewards credit cards offer the most flexibility, providing points or miles that can be redeemed across a wide range of travel services and loyalty programs, including multiple airlines and hotels. Generally, they don't restrict you to a particular brand, giving you the flexibility to use rewards for a wider range of travel expenses such as flights, hotels, rental cars, and even non-travel purchases.

Pros of miles:

  • Higher travel rewards: Miles credit cards usually offer higher rewards on travel than cash back credit cards.
  • Variety of travel rewards: Aside from just flights, miles can usually be redeemed for other rewards like seat upgrades, meals at certain restaurants, and nights at hotel chains.
  • Additional perks: Travel credit cards often come with extra benefits, like travel insurance, priority boarding, and airport lounge access.  

Cons of miles:

  • Complexity: Miles can be more difficult to translate into dollar value compared to flat-rate cash back rewards.
  • Expiration risk: Miles from credit cards may expire if not used within a certain timeframe, leading to lost rewards if you don't travel frequently.
  • Annual fees: The best travel rewards credit cards often carry high annual fees.

Calculating the value of miles vs. cash back

Figuring out the value of different rewards programs can be tricky if you have to convert miles into dollars, but it can be done. For instance, consider a 2% cash back card vs. a card that earns 2x miles on purchases. For the cash back card, a $100 purchase would earn $2 back. A 2x miles card would in theory earn that same $2 back—but that isn’t always the reality. The value of miles can be less or more depending on the card and how you choose to redeem them.

To compare the value accurately, you'll need to assess how much each mile is worth when redeeming rewards for flights, hotel stays, or other categories. Typically, miles are valued between 1 and 2 cents each, but this can vary widely based on the redemption option. For example, using miles for an economy flight might yield less value per mile than redeeming them for a business class upgrade. Thus, the actual benefit of a 2x miles card depends on the specific redemption value of the miles, which requires a bit of research to determine the most advantageous use.

Strategies to maximize miles or cash back rewards

Choosing between miles and cash back credit cards involves more than just comparing reward rates and perks; it requires a strategic approach tailored to your business's spending habits and goals. Here are strategies for businesses to maximize the benefits of each type of card:

For cash back card users:

Redemption flexibility

Opt for cards that allow for direct cash back redemption without minimum thresholds. This flexibility allows you to use cash back rewards at your convenience, helping to manage cash flow.

Stacking rewards

Maximize your savings on business expenses by pairing cash back rewards with merchant discounts and promotions. This strategic combination can greatly decrease the cost of your everyday purchases, allowing you to stretch your budget and boost your bottom line.

Budgeting tool

Use cash back rewards as a direct way to reduce monthly operational costs or reinvest in other areas of your business. This strategy not only provides immediate financial relief but also lets you plan for future investments or expenses by allocating cash back rewards strategically throughout the fiscal year.

Consolidated purchasing

Try to use your cash back card for all business-related purchases instead of switching between cards. By funneling all possible business expenses through your cash back card, you can maximize your return on every dollar spent by your business.

For miles card users:

Strategic spending

Focus spending on your miles card for business travel expenses to earn more miles faster. Choose a card that offers bonus miles for airline, hotel, and car rental expenses to accelerate your accumulation of rewards. This spending strategy will increase the value of every business trip, making sure that every dollar spent contributes directly to your next travel opportunity.

Miles optimization

Make it a habit to regularly assess the worth of your miles when considering different travel choices. Try to use your miles for more valuable rewards, like international flights or business class upgrades, to get the most value out of them. Keeping up-to-date with the changing value of miles and redemption opportunities can help you make knowledgeable choices that enhance the return on your travel expenses.

Transfer partners

Choose a card that allows you to transfer miles to a variety of travel partners, like airline and hotel chains, to take advantage of the best redemption rates and travel options. This flexibility will let you choose the most cost-effective flights and hotels, while also adapting to changing travel plans without sacrificing the value of your miles.

Loyalty benefits

You might want to use cards affiliated with specific airlines or hotels to enjoy extra perks like free checked bags, priority boarding, or complimentary night stays, making your business trips more enjoyable and productive for employees.

Is it better to have cash back or miles?

The best credit card for you depends on the frequency of your travel habits. If you’re not a frequent traveler, cash back credit cards are the best choice to earn flat-rate rewards on purchases. That statement credit can then be used toward whatever you need most. A miles credit card is a great way to earn rewards if you travel often, but it probably isn’t worth the annual fee otherwise.

Try Ramp’s corporate card with 1.5% cash back rewards

Ramp is a corporate card that offers 1.5% cash back on purchases. As an all-in-one corporate card and spend management platform, Ramp is designed to simplify your company’s financial operations, providing a seamless way to manage expenses and optimize savings.

Some of Ramp’s features include:

  • Cash back: Ramp earns you 1.5% cash back on purchases, directly contributing to your bottom line and offering immediate value back on your spending.
  • Simplified expense management: Ramp's platform integrates with your existing accounting software, making it easier to track expenses, categorize spending, and automate reports, reducing administrative workload and the risk of human error.
  • Real-time insights: Get instant access to your spending data, allowing you to make informed and timely financial decisions.
  • Enhanced control: Set custom spending limits, create virtual cards for specific expenses, and manage employee spending with ease, ensuring compliance and preventing out-of-policy spending.
Try Ramp for free.
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Finance Writer and Editor, Ramp
Ali Mercieca is a Finance Writer and Content Editor at Ramp. Prior to Ramp, she worked with Robinhood on the editorial strategy for their financial literacy articles and with Nearside, an online banking platform, overseeing their banking and finance blog. Ali holds a B.A. in Psychology and Philosophy from York University and can be found writing about editorial content strategy and SEO on her Substack.
Ramp is dedicated to helping businesses of all sizes make informed decisions. We adhere to strict editorial guidelines to ensure that our content meets and maintains our high standards.


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