8 best practices for corporate credit card management

Corporate card policies come under a company’s accounting policy and set a clear set of rules and regulations around corporate cards issued in an employee’s name. Violations are safeguarded with extensive protocols, thereby protecting your business against instances of fraud or employee personal expenses. Some of the key points to consider while making a corporate credit card policy are eligibility and responsibilities of the cardholder, limits on the card and its spending, following due process of submitting proof of receipt, and specific consequences that can arise in case of policy violation.

Creating a budget for departmental expenses can save your accounts team a huge amount of time by simply taking the guesswork out of which department/employee spent how much on a particular card. Departmental budgets can act as a pool and every cardholder is assigned a card out of that particular budget. This helps to maintain the spending limit of the business overall while helping you see whenever you surpass your set budget.

It is of utmost importance to let your employees know what constitutes business expenses and what doesn’t. Sometimes employees use corporate credit cards to pay for personal expenses with the intention of paying the company later. By letting them know what they can and cannot use the card for, you are also alleviating any lingering doubt or pressure of figuring things out on their own from the employees’ minds.

It takes a lot of trust from your side to issue a corporate card to your employees. However, there could be an employee who might treat it as fun and not a responsibility that it is. That’s why it is essential to issue corporate cards to employees only when there is a real need for them. Making sure that your corporate card is in the right hands for the right reason is the best way to minimize instances of fraud, etc.

One of the biggest benefits of using corporate cards for your company is the sheer transparency it provides in terms of tracking your employee’s spending habits. Corporate cards record every single transaction made, allowing you to monitor your employee’s expense pattern with the credit statements and bank statements to filter out any discrepancies. You can also see if any employee is indulging in overspending and nip that habit in the bud quickly.

Simplifying your expense reporting process is a surefire way to ensure that expense receipts are updated on time corresponding to the appropriate corporate credit card purchase. By investing in a smart expense tracking and uploading tool, all your employees have to do is simply update a digital version of the receipt, such as a photograph to the software for the admin to approve and they are done.

When you are using your modern corporate card, why not unlock its full potential by integrating it with your pre-existing accounting software? Look out for corporate credit card management programs that offer seamless integration with the accounting software you use. This one small step can potentially save up to hundreds of work hours reconciling corporate cards with your statements and then recording them manually.

Take the guesswork out of where a corporate credit card can be used by laying down particular purchase categories for each card and its respective cardholder. This means that a card issued particularly for travel expenses may not be used for vendor payouts. What this does is that it keeps track of expenses made by a particular employee or department and ensures that the budget the card falls under is being maintained as such. Coupled with your corporate card policy, this small yet ingenious trick might be just what you need in your arsenal!