What are corporate cards and how does it help businesses?
Corporate cards for businesses have become a staple in modern finance, offering a streamlined solution for managing expenses and providing numerous benefits to companies of all sizes.
Corporate cards may come with different features and benefits depending on the card provider. But at its core, a corporate card is a great tool to help employees seamlessly use the company budget while also being able to maintain control over expenses.
To understand how you should choose a corporate card provider for your business, you must explore their functionality, advantages, and how they aid businesses in navigating the financial landscape efficiently.
What are corporate cards?
Corporate cards are specialized payment cards issued to the employees of a company for making business-related purchases. Corporate cards can be debit, credit, or prepaid in nature depending on the card issuer.
Unlike personal credit cards, which are intended for individual use, corporate cards are tailored to meet the unique needs of multiple employees in a business, facilitating expense management, tracking, and control.
These cards are typically linked to a company's corporate account, enabling only authorized employees to charge expenses directly to the organization rather than using personal funds. This feature not only simplifies the payment process but also enhances transparency and accountability in financial transactions.
Corporate cards offer businesses a convenient means of managing various expenses, including travel, entertainment, supplies, and other operational costs.
By centralizing all types of expenses through a single payment platform, companies can streamline their financial workflows, reduce administrative burdens, and gain valuable insights into spending patterns.
How is a corporate card different from a regular credit card?
While corporate cards and regular credit cards may appear similar at first glance, several fundamental differences distinguish them in terms of functionality, usage, and purpose.
1. Ownership and liability
Corporate cards are issued to employees by their employer and are linked to the company's corporate account, whereas regular credit cards are owned by individuals and tied to their personal credit accounts.
With corporate cards, the employer assumes liability for the charges incurred, whereas with regular credit cards, the cardholder is personally liable for payments.
2. Expense management
Corporate cards offer robust expense management automation features tailored to business needs, including customizable spending limits, detailed transaction reporting, and integration with accounting software.
Regular credit cards typically lack these specialized business tools and are primarily designed for personal use, offering limited expense-tracking capabilities.
3. Usage restrictions
Corporate cards may come with restrictions on usage, such as prohibiting personal expenses or limiting purchases to specific categories or merchants, to ensure compliance with company policies.
Regular credit cards have fewer usage restrictions and can be used for a wide range of personal expenditures without limitations imposed by the card issuer or employer.
4. Rewards and benefits
Corporate cards often offer rewards and incentives tailored to business spending, such as cashback on office supplies, travel perks, or discounts on business-related services.
Regular credit cards typically provide rewards geared towards personal spending, such as points for retail purchases, travel rewards, or cashback on everyday expenses.
Different types of corporate card
Corporate credit cards
Corporate credit cards offer businesses a line of credit to cover expenses, with payments typically due every month. The credit period can vary from 30, 60, and sometimes even 90 days for industries where the sales turnover time is quite long.
These cards provide flexibility in spending while allowing companies to build credit history and earn rewards on business-related purchases.
Corporate debit cards
Corporate debit cards deduct funds directly from a company's bank account, functioning just like a normal personal debit card. This provides a convenient cashless payment option for daily operations and employees who have to travel for their work.
Unlike credit cards, they do not incur interest charges, making them suitable for businesses seeking to avoid debt and manage expenses within available cash flow.
Corporate travel cards
While other types of corporate cards can also be used for making travel-related expenses, a corporate travel card is specifically designed to cater to the needs of frequent business travelers.
Corporate travel cards offer perks such as airline miles, hotel discounts, and travel insurance. These cards streamline travel-related expenses, provide access to exclusive travel benefits, and offer enhanced security features for transactions made abroad.
Expense management cards
These cards integrate with expense management software to streamline the reporting, tracking, and reconciliation of business expenditures. In most cases, the corporate card provider will have its expense management software that you can link the corporate cards with.
By capturing transaction data in real time and automating expense workflows, these cards enhance visibility, control, and compliance with company spending policies.
Corporate prepaid cards
Corporate prepaid cards are loaded with funds in advance, enabling controlled spending and eliminating the need for credit checks. These cards are ideal for managing employee allowances, petty cash, and discretionary spending, offering security and convenience without the risk of overspending or accruing debt.
These corporate cards are very similar to corporate debit cards in how they function.
Corporate virtual cards
Virtual corporate cards generate unique card numbers for each transaction, enhancing security and reducing the risk of fraud. These cards are issued electronically and can be used for online purchases, travel bookings, and recurring payments, providing businesses with greater control and protection against unauthorized transactions.
Additionally, virtual cards offer seamless integration with digital payment platforms and expense management systems, simplifying administrative tasks and enhancing overall efficiency in corporate spending management.
Modern corporate cards to streamline business expense management
What is a corporate credit card?
A corporate credit card is a financial tool issued by banks or financial institutions to companies for their employees' business-related expenses.
Unlike personal credit cards, corporate cards are designed specifically for business use, offering a convenient payment method while providing various benefits and features tailored to streamline expense management and enhance financial control within organizations.
1. Benefits
● Convenient payment method
Corporate credit cards provide a hassle-free way for employees to make purchases on behalf of the company, eliminating the need for cumbersome expense reimbursement processes. Employees no longer have to use personal funds to make business purchases and wait weeks or months to get reimbursed for it.
● Helps build business credit
You can get corporate credit cards even if you do not have a credit history provided your company’s finances are healthy and stable. By using corporate credit cards responsibly and making timely payments, companies can establish and improve their creditworthiness, which may facilitate access to financing and favorable terms in the future.
● Offers rewards like cash back or travel points
Many corporate credit cards come with rewards programs that allow companies to earn cash back, travel points, or other incentives based on their spending, providing a valuable opportunity to offset expenses or fund future business-related activities.
● Provides detailed expense tracking
Corporate credit cards offer robust expense-tracking features, enabling companies to monitor and analyze expenditures with ease. Each transaction is recorded in real-time on a single platform. Detailed transaction records and customizable reporting tools facilitate budgeting, auditing, and compliance with financial regulations.
2. Features
● Revolving credit limit
Corporate credit cards typically come with a revolving credit limit, allowing companies to borrow funds up to a predetermined amount and repay the balance over time, subject to interest charges. Every month the limit is reset and employees can start using the balance again for further expenses.
● Ability to set individual spending limits for employees
This is one of the key advantages of using corporate cards. Employers can set individual spending limits for each cardholder, ensuring responsible use of company funds and preventing overspending or misuse.
So while employees have the freedom of choice and time to make business payments whenever needed, employers still have control over the amount that can be spent through a card.
● Online account management
Corporate credit card accounts can be managed conveniently through online portals or mobile apps, providing access to transaction history, payment processing, and account monitoring from anywhere with internet connectivity.
The mobile app of a corporate card provider is especially helpful in improving accessibility as it negates the need to constantly open your laptop or desktop to check financial transactions.
● Expense categorization
Transactions made with corporate credit cards can be automatically categorized based on predefined criteria, simplifying expense tracking, budgeting, and financial reporting processes for businesses of all sizes.
What is a corporate debit card?
A corporate debit card is a financial tool provided by banks or financial institutions to businesses to manage their expenses.
Unlike corporate credit cards, which involve borrowing funds, corporate debit cards allow companies to access their funds directly from their bank accounts, providing a convenient and secure payment method for business-related transactions.
1. Benefits
● Access to company funds without borrowing
Corporate debit cards enable businesses to utilize their funds for expenses, eliminating the need for credit and avoiding interest charges associated with borrowing. This is a route that some companies may prefer over using a corporate credit card.
● No interest charges
Since corporate debit cards do not involve borrowing money, companies do not incur interest charges on purchases made with these cards, resulting in cost savings over time as compared to the usage of corporate credit cards that may have interest charges.
● Helps control employee spending
By providing employees with corporate debit cards, businesses can exert greater control over spending. Not only does a corporate debit card already have a certain limit up to which it can hold money, but employers can also set limits on individual card usage and ensure adherence to company budgets and financial policies.
● Simplifies expense management
Corporate debit cards streamline the expense management process, allowing for easy tracking and categorization of transactions. This simplifies accounting tasks and enhances transparency in financial reporting. You can view all the transactions on a single platform after the corporate cards are linked to the expense management software.
● Reduces the risk of overspending
With corporate debit cards, companies can mitigate the risk of overspending by limiting cardholders' access to predetermined funds, preventing unauthorized or excessive purchases.
2. Features
● Real-time transaction tracking
Corporate debit cards provide real-time updates on transactions, enabling businesses to monitor spending activity and detect any anomalies promptly. Finance teams can keep track of all the expenses being made by different employees using different cards much more easily.
● Spending controls
Employers can implement spending controls and restrictions on corporate debit cards. This includes setting limits like daily or monthly spending limits on each card or transaction category restrictions which stops someone from purchasing items that fall under a certain expense category. All of these measures help to manage expenses effectively.
● Customizable card settings
Corporate debit cards offer customizable settings and features to meet the unique needs of businesses, including the ability to deactivate or reactivate cards, set up alerts for suspicious activity, and customize cardholder permissions and privileges.
What is a corporate travel card?
A corporate travel card is a specialized payment tool designed to streamline travel-related expenses for businesses and their employees.
Tailored specifically for business travel, these cards offer a range of benefits and features aimed at enhancing convenience, saving costs, and providing additional perks for corporate travelers. Let's delve into the key benefits and features of corporate travel cards.
1. Benefits
● Tailored for travel-related expenses
Corporate travel cards are specifically designed to cover expenses incurred during business trips, including airfare, accommodation, meals, and transportation. This card is best suited for frequent business travelers who need a flexible and secure payment method that is accepted in most places.
● Offers travel rewards and perks
Many corporate travel cards come with rewards programs tailored to business travel, allowing companies to earn points, miles, or cashback on travel-related purchases.
These miles, points, or cashback can then later be redeemed to get discounts on your travel expenses.
● Provides travel insurance coverage
Corporate travel cards often include travel insurance benefits such as trip cancellation/interruption coverage, emergency medical assistance, and lost luggage reimbursement, offering peace of mind to travelers and employers alike.
Due to this you need not worry about taking a separate insurance policy for travel-related mishaps.
● Streamlines expense reporting for business trips
By consolidating travel expenses onto a single card, corporate travel cards simplify the expense reporting process for business trips, reducing paperwork and administrative overhead.
All travel-related expenses are consolidated in one place making things easier for both the employee and the employer.
2. Features
● Travel rewards program
Corporate travel cards may offer rewards programs that provide incentives for business travel, such as earning points or miles that can be redeemed for flights, hotel stays, or other travel-related expenses.
● Travel assistance services
Many corporate travel cards offer access to travel assistance services, including concierge services, emergency assistance, and travel planning support, to help travelers navigate their trips smoothly. This can be very helpful when traveling to a place you have never visited before.
● Foreign transaction fee waivers
Corporate travel cards often waive foreign transaction fees, making them a cost-effective payment option for international travel and reducing currency conversion charges for businesses operating globally.
● Integration with travel and expense management systems
Corporate travel cards can integrate seamlessly with travel and expense management systems, allowing for automated expense tracking, reporting, and reconciliation, thereby streamlining administrative tasks and improving visibility into travel-related spending.
Smart corporate cards to manage your business expenses
What is a corporate expense management card?
A corporate expense management card is a financial tool utilized by businesses to streamline the process of tracking, managing, and controlling employee expenses.
Specifically designed to simplify expense reporting and reimbursement procedures, these cards offer various benefits and features aimed at enhancing visibility, control, and compliance with company expense policies.
Let's explore the key benefits and features of corporate expense management cards.
1. Benefits
● Streamlines expense reporting and reimbursement processes
Corporate expense management cards streamline the often tedious and time-consuming processes of expense reporting and reimbursement, reducing administrative burdens and improving efficiency. A corporate expense card removes the need for submitting reimbursement claims altogether.
● Improves visibility and control over spending
Using a corporate expense management card, all the transactions will be recorded instantly on a single platform. By providing real-time visibility into employee spending activities, corporate expense management cards enable businesses to monitor expenses closely and exercise greater control over company finances.
● Enhances compliance with company expense policies
Corporate expense management cards help enforce company expense policies by setting predefined spending limits, categorizing expenses, and flagging non-compliant transactions for review. This method ensures that company expense policies are not only verbally conveyed to employees but also functionally enforced through technology.
2. Features
● Customizable spending limits
Not every employee will need the same amount of budget to carry out their daily operations. Employers can set individualized spending limits for each cardholder, ensuring that expenses remain within budgetary constraints and align with company guidelines.
● Receipt capture and management
Corporate expense management cards often come with receipt capture features, allowing employees to photograph receipts and attach them to corresponding transactions for easy documentation and auditing purposes. This is an extremely easy process to do with the use of a mobile app as compared to filing lengthy expense reports at the end of the month.
● Integration with accounting software
These cards integrate seamlessly with accounting software platforms, facilitating the automatic transfer of transaction data and simplifying expense reconciliation and reporting tasks. This syncing of transaction information ensures that there is uniformity of data across both financial platforms so that there is no confusion.
● Real-time expense tracking
Corporate expense management cards provide real-time updates on spending activities, enabling businesses to monitor expenses as they occur and take timely corrective actions if necessary.
● Automated expense reporting
By automating expense reporting processes, corporate expense management cards eliminate manual data entry and reduce the risk of errors, ensuring accurate and timely submission of expense reports for reimbursement.
What is a corporate prepaid card?
A corporate prepaid card is a financial tool issued by companies to employees for making business-related purchases. Unlike traditional credit or debit cards, corporate prepaid cards are loaded with funds in advance, providing a controlled spending solution that eliminates the need for reimbursement processes.
Let's explore the key benefits and features of corporate prepaid cards.
1. Benefits
● Controls spending by limiting employees to preloaded funds
Corporate prepaid cards help control employee spending by restricting purchases to the preloaded amount, preventing overspending, and promoting budget adherence. These controls ensure that there is no chance of spending more than what was assigned to a card.
● Eliminates the need for reimbursement
Since corporate prepaid cards are funded in advance, there is no need for employees to pay out-of-pocket or seek reimbursement for business expenses, streamlining the payment process. They can easily use the prepaid card whenever they need to make a business expense and avoid the need to use personal funds.
● Reduces risk of overspending
By limiting spending to the available prepaid balance, corporate prepaid cards mitigate the risk of overspending and unauthorized purchases, ensuring financial discipline within the organization.
2. Features
● Loadable with funds from company accounts
Corporate prepaid cards are funded by transferring funds from company accounts, allowing employers to allocate funds to employees as needed and maintain control over spending. This means that employees are accountable and answerable for all the transactions they make and must answer why they might need additional funds in case their predetermined budget is exhausted before the renewal period.
● Spending controls and restrictions
Employers can implement spending controls and restrictions on corporate prepaid cards, such as daily spending limits, transaction category restrictions, and merchant blacklists, to manage expenses effectively. All of these methods together help the finance team of a company maintain control over the company budget.
● Real-time transaction monitoring
Corporate prepaid cards provide real-time monitoring of transactions, enabling employers to track spending activities as they occur and detect any irregularities or unauthorized purchases promptly. In case they detect something suspicious, they can immediately contact the employee that the card belongs to and investigate the situation.
What is a corporate virtual card?
A corporate virtual card is a digital payment solution issued by companies to facilitate online transactions and streamline expense management processes.
Unlike physical cards, corporate virtual cards exist purely in digital form, providing enhanced security for online purchases and offering flexibility for remote employees. Let's delve into the key benefits and features of corporate virtual cards.
1. Benefits
● Enhanced security for online transactions
Corporate virtual cards use encryption and tokenization technologies to provide heightened security for online transactions, reducing the risk of fraud and unauthorized use. This improved level of security protocols makes corporate virtual cards a better choice for online transactions as compared to physical cards.
● Offers flexibility for remote employees
Sending and shipping physical corporate cards to remote employees can be tough sometimes. Virtual cards enable remote employees to make secure online payments without the need for physical cards. This provides flexibility and convenience for businesses with a remote workforce.
● Simplifies reconciliation of online purchases
By generating unique card numbers for each transaction, corporate virtual cards streamline the reconciliation of online purchases, making it easier to track and categorize expenses.
2. Features
● Encryption for secure transactions
Corporate virtual cards employ encryption protocols to safeguard sensitive cardholder information and ensure secure transactions in online environments.
Furthermore, these cards also have temporary freezing and permanent blocking features that are helpful in case the card details are exposed.
● Integration with expense management systems
Just like physical corporate cards, virtual cards seamlessly integrate with expense management systems, allowing for automated tracking, reporting, and reconciliation of online transactions.
● Real-time transaction alerts
Virtual cards provide real-time transaction alerts, notifying cardholders and administrators of any suspicious or unauthorized activity, enabling swift action to mitigate potential risks.
In case it is understood that the card details have been stolen through your browser or some data leaks, you can immediately freeze or block the card so that payments cannot be made through that card anymore.
Get the best corporate card program for your business
How do corporate cards work
Corporate cards operate similarly to personal credit cards but are tailored to meet the unique needs of businesses. When a company issues corporate cards to its employees, it sets spending limits and establishes approval processes to regulate spending.
Employees use these cards to make business-related purchases, such as office supplies, travel expenses, or client entertainment.
Spending limits can be customized for each cardholder, ensuring that expenses remain within budgetary constraints and align with company policies. Before making a purchase, employees may need to obtain authorization, either manually or through automated approval workflows.
Transaction data captured by corporate cards is then compiled into detailed reports, providing businesses with insights into spending patterns and facilitating expense tracking and management.
These reports can be integrated with accounting software or expense management systems for streamlined reconciliation and reporting processes, ultimately enhancing visibility, control, and compliance with company financial policies.
Factors to consider when choosing corporate cards
Selecting the right corporate card involves careful consideration of various factors to meet the specific needs of your business.
From analyzing spending patterns to assessing card features and costs, each aspect plays a crucial role in determining the suitability of a corporate card for your organization. Let's explore key factors to consider when choosing corporate cards.
Business needs and spending patterns
Understanding your business's unique requirements and expenditure patterns is essential in selecting a corporate card that aligns with your financial objectives and operational priorities.
Consider factors such as the frequency of business travel, types of expenses incurred, and the volume of transactions to identify the most suitable card option.
You may find that certain expenses are more frequent in your line of business than others. Based on this data you should find a corporate card suitable for those needs.
Credit limits and spending controls
If you plan to opt for a corporate credit card, then make sure that you review the credit limit the card issuer offers and whether it meets your monthly expense needs.
Similarly, also see whether the spending controls are available with corporate cards to establish appropriate levels of financial oversight and control over employee expenditures.
Ensure that card limits can be adjusted easily to accommodate fluctuating business needs and that spending controls can be customized to align with company policies.
Card features and benefits
Evaluate the range of features and benefits offered by corporate cards, including rewards programs, travel perks, expense management tools, and reporting capabilities, to ensure they meet your business requirements effectively.
Look for features that add value to your company, such as cashback rewards on office supplies or discounts on travel expenses.
The card that gives you the most value over the long term while still being at a reasonable cost is the one you should aim for.
Costs and fees
Consider the costs associated with corporate cards, such as annual fees, interest rates, foreign transaction fees, and other charges, to assess their impact on your company's budget and financial sustainability.
Compare the fee structures of different card options and weigh them against the benefits they offer to determine the overall value proposition.
Remember that a card with no types of fees does not always mean it is better. It may turn out to have poor service and acceptance and end up not solving the problem you have.
Syncing with accounting software
Choose corporate cards that seamlessly integrate with your existing accounting software or expense management systems to streamline expense tracking, reporting, and reconciliation processes.
Look for card providers that offer API integrations or data export capabilities to ensure compatibility with your preferred financial management tools.
This is an essential factor to consider as it will decide how smoothly and efficiently your finance team is able to handle and maintain all expenses.
Security features
Prioritize corporate cards with robust security features, such as EMV chip technology, fraud monitoring, and purchase alerts, to safeguard against unauthorized transactions and mitigate the risk of fraud.
Verify the security protocols implemented by card issuers and inquire about additional security measures available for enhanced protection.
Make sure you also get the option to freeze or block the card instantly through a mobile app in cases where your card is lost or stolen.
Customer support and service
Assess the quality of customer support and service provided by card issuers, including accessibility, responsiveness, and assistance with account management and resolution of issues.
Opt for card providers with a reputation for excellent customer service and reliable support channels to ensure a smooth experience for your employees.
It might be difficult to judge the level of support and assistance provided by a business before you choose them, but a way around this is to read reviews on third-party review sites without any bias toward a product.
Compatibility with travel policies
Ensure that corporate cards align with your company's travel policies and compliance requirements, including acceptance by preferred vendors, reimbursement procedures, and adherence to travel expense guidelines.
Confirm that the card network is widely accepted internationally and inquire about any special arrangements for corporate travel, such as negotiated rates or travel insurance coverage.
How do corporate cards help in smarter spending?
Corporate cards play a vital role in promoting smarter spending practices within businesses, offering a range of features and tools to optimize expenditure management.
From issuing individual virtual cards to providing access to analytics, these cards empower companies to make informed financial decisions and drive efficiency in their spending processes. Let's explore how corporate cards facilitate smarter spending.
1. Manage your subscriptions easily
With corporate cards, companies can manage recurring subscription payments effortlessly, reducing manual efforts and ensuring timely renewals. By centralizing subscription payments on corporate cards, businesses can track expenses more effectively and avoid disruptions to essential services.
2. Issue individual virtual cards
Corporate cards enable businesses to issue individual virtual cards for specific purposes or transactions, ensuring controlled and secure spending. This capability allows companies to set spending limits and restrictions tailored to each transaction, reducing the risk of overspending or misuse.
3. Request for funds
Employees can request funds directly through corporate cards for approved business expenses, streamlining the reimbursement process and improving cash flow management.
This feature eliminates the need for employees to use personal funds for business-related expenses and simplifies expense tracking for finance teams.
4. Allocate budgets as per departments
Corporate cards allow companies to allocate budgets to different departments or cost centers, enabling better control and accountability over spending. By assigning specific budgets to each department, businesses can ensure that expenditures align with organizational goals and priorities.
5. Set multi-level approvals
Employers can implement multi-level approval workflows for corporate card transactions, enhancing oversight and compliance with company policies. This feature enables managers to review and authorize expenses based on predetermined criteria, ensuring transparency and accountability in spending decisions.
6. Earn cashback
Many corporate cards offer cashback rewards on business purchases, providing an incentive for employees to make cost-effective decisions and maximize savings. By leveraging cashback incentives, companies can reduce overall expenses and enhance the value proposition of corporate card programs.
7. Freeze and block corporate cards
In case of loss or unauthorized use, corporate cards can be frozen or blocked instantly, minimizing the risk of fraud and unauthorized spending. This feature provides added security and peace of mind for businesses, allowing them to take swift action to protect company funds and assets.
8. Single & recurring payments
Corporate cards facilitate both single and recurring payments, offering flexibility and convenience in managing various types of expenses. Whether it's paying suppliers, vendors, or recurring bills, corporate cards streamline payment processes and provide a centralized platform for expense management.
9. Integration with expense management systems
Corporate cards seamlessly integrate with expense management systems, allowing for automated data synchronization and streamlined expense tracking and reporting. This integration eliminates manual data entry, reduces the risk of errors, and accelerates the reimbursement process for employees.
10. Access to analytics and insights
By providing access to detailed transaction data and spending analytics, corporate cards enable businesses to gain valuable insights into their spending patterns and identify opportunities for optimization and cost reduction.
With real-time access to spending metrics and performance indicators, companies can make data-driven decisions to drive efficiency and maximize the value of corporate card programs.
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Security options are available to prevent fraud on corporate cards
Two-factor authentication adds an extra layer of security by requiring users to provide two forms of verification, such as a password and a unique code sent to their mobile device, before accessing their accounts or making transactions.
This method reduces the likelihood of unauthorized access to corporate card accounts.
EMV chip technology enhances card security by generating unique transaction codes for each payment, making it difficult for fraudsters to replicate card information.
This technology significantly reduces the risk of counterfeit card fraud compared to traditional magnetic stripe cards. It also drasticlaly reduces the chances of card cloning and fradulent transactions.
Data encryption scrambles sensitive information during transmission, making it unreadable to unauthorized parties and protecting cardholder data from interception or theft.
Encryption ensures that cardholder information remains secure while being transmitted over networks or stored in databases.
Transaction alerts notify cardholders of any suspicious or unusual activity on their accounts, enabling them to take immediate action to prevent fraud or unauthorized transactions.
These alerts can be sent via email, SMS, or push notifications, providing real-time updates on card activity.
Many card issuers offer fraud protection services that monitor card activity for signs of fraudulent behavior, such as unusual spending patterns or suspicious transactions, and take proactive measures to prevent fraud.
These services may include advanced fraud detection algorithms, machine learning techniques, and 24/7 monitoring by dedicated security teams.
Providing cardholders with a simplified process for activating and deactivating their cards, such as through mobile apps or online portals, allows them to quickly respond to security concerns or lost/stolen cards, reducing the risk of unauthorized use.
This enables cardholders to take immediate action to protect their accounts in case of suspected fraud or security breaches.
Use cases of corporate cards
Corporate cards serve as versatile financial tools with a wide range of applications across various business scenarios. From facilitating in-store purchases to enabling cross-border transactions, these cards offer flexibility and convenience for businesses of all sizes. Let's explore some common use cases of corporate cards:
In-store & online purchases
Corporate cards can be used for both in-store and online purchases, providing a convenient payment method for procuring goods and services.
Whether buying office supplies, equipment, or inventory, corporate cards streamline the purchasing process and offer opportunities to earn rewards or cashback on business expenses.
Contactless payments - Apple Pay & Google Pay
Many corporate cards support contactless payments through digital wallets like Apple Pay and Google Pay, offering a secure and efficient way to make transactions.
This feature enhances convenience for employees, especially in situations where speed and minimal contact are preferred, such as during business travel or in retail environments.
Can be used as a Foreign Exchange (FX) card
Corporate cards can function as foreign exchange (FX) cards, allowing businesses to make international transactions and manage currency conversions seamlessly.
Whether paying suppliers abroad, conducting overseas business trips, or managing global operations, corporate cards with FX capabilities simplify cross-border transactions and reduce currency exchange costs.
Can be used as a travel and entertainment (T&E) card
Corporate cards are often used as travel and entertainment (T&E) cards, enabling employees to cover expenses related to business trips, accommodations, meals, and entertainment activities.
With features such as travel insurance, airport lounge access, and expense tracking tools, corporate T&E cards enhance the travel experience for employees while providing businesses with greater control and visibility over travel expenditures.
Cross-border transactions
Corporate cards facilitate cross-border transactions, enabling businesses to conduct international trade and commerce efficiently while managing foreign exchange risks and costs.
Whether purchasing goods from overseas suppliers, expanding into new markets, or managing global supply chains, corporate cards offer a convenient and secure payment solution for cross-border transactions, reducing reliance on traditional banking channels and minimizing currency conversion fees.
How to manage corporate card expenses
Effectively managing corporate card expenses is crucial for maintaining financial control and accountability within a business.
By implementing clear policies and leveraging technology, companies can streamline expense management processes and ensure compliance with company guidelines. Let's explore key strategies for managing corporate card expenses:
Establish clear expense policies
Define clear guidelines and policies outlining acceptable expenses, spending limits, and reimbursement procedures to provide employees with guidance and ensure consistency in expense management practices.
Set spending controls
Implement spending controls and restrictions on corporate cards, such as transaction limits, merchant category restrictions, and daily spending caps, to prevent overspending and unauthorized purchases.
Issue cards selectively
Issue corporate cards selectively to employees based on their roles, responsibilities, and spending needs, ensuring that cards are allocated only to authorized personnel who require them for business purposes.
Monitor transactions in real-time
Utilize expense management software or card issuer platforms to monitor corporate card transactions in real time, enabling prompt identification of irregularities or unauthorized expenses for immediate action.
Review and analyze spending
Regularly review and analyze corporate card spending patterns and trends to identify areas of overspending, cost-saving opportunities, or potential policy violations, allowing for informed decision-making and optimization of expense management processes.
Require receipts and documentation
Enforce policies requiring employees to submit receipts and documentation for all corporate card transactions, facilitating accurate expense tracking, compliance with tax regulations, and audit readiness. This ensures transparency and accountability in expense reporting and reimbursement processes.
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What are the benefits of using corporate cards?
Corporate cards are widely accepted by merchants and vendors worldwide, providing businesses with a convenient payment solution for domestic and international transactions.
Using corporate cards simplifies expense tracking and reporting, reducing administrative overhead and ensuring accurate financial records.
Corporate cards enable businesses to set custom controls and restrictions, ensuring compliance with company policies and reducing the risk of unauthorized spending.
Corporate cards provide a convenient payment method for employees to make business-related purchases, eliminating the need for cash or personal credit cards.
Many corporate cards offer rewards programs and incentives, allowing businesses to earn cashback, travel rewards, or other perks on eligible purchases.
By enforcing spending policies and controls, corporate cards help ensure adherence to company guidelines and regulatory requirements.
Corporate cards come with advanced security features, such as EMV chip technology and fraud monitoring, to protect against unauthorized transactions and fraud.
Companies can set custom controls on corporate cards, such as spending limits and merchant category restrictions, tailored to their specific needs and preferences.
Corporate cards are designed for ease of use, providing employees with a straightforward payment solution for their business expenses.
Corporate cards seamlessly integrate with accounting software, enabling automated data synchronization and streamlined expense reconciliation.
Businesses can monitor corporate card transactions in real time, gaining immediate visibility into spending activities and detecting any irregularities or policy violations promptly.
Using corporate cards can improve cash flow management by providing a revolving line of credit for business expenses, reducing the need for upfront payments or reimbursement delays.
Corporate cards eliminate the need for employees to use personal funds for business expenses and simplify the reimbursement process for both employees and finance teams.
By automating expense tracking and reporting, corporate cards save time and reduce paperwork associated with manual expense management processes.
Prompt payment through corporate cards can enhance vendor relationships by ensuring timely settlement of invoices and fostering trust and reliability.
What fees are associated with corporate cards?
While corporate cards offer numerous benefits, it's essential to be aware of associated fees to effectively manage costs. Understanding these fees allows businesses to make informed decisions and optimize card usage. Let's explore common fees associated with corporate cards:
1. Annual fee
Most corporate cards charge an annual fee for card membership, which covers benefits and services provided by the issuer. This fee can vary depending on the card's features and the issuer's policies.
2. Transaction fees
Some corporate cards impose transaction fees for certain types of transactions, such as cash advances or balance transfers.
Additional charges may also be applied for transactions being made outside domestic borders or online international transactions. These fees may be charged as a flat rate or a percentage of the transaction amount.
3. Late payment fee
Late payment fees are assessed when cardholders fail to make minimum payments by the due date, encouraging timely payment. These fees serve as a penalty for delayed payments and can vary depending on the issuer's terms and conditions.
4. Interest charges
Corporate cards may incur interest charges on outstanding balances carried from month to month, particularly for cards with revolving credit options.
The interest rate, also known as the annual percentage rate (APR), applies to the unpaid balance and accrues over time until the balance is paid in full.
5. Foreign transaction fee
When using corporate cards for international transactions, foreign transaction fees may apply, typically a percentage of the transaction amount. These fees cover the costs associated with currency conversion and processing international payments.
6. Card replacement fee
If a corporate card is lost, stolen, or damaged, card replacement fees may be charged to cover the cost of issuing a new card. The replacement fee helps offset the administrative and production costs associated with reissuing a card and ensuring the security of cardholders' accounts.
Is a corporate card necessary for your business?
Determining the necessity of a corporate card for a business involves a comprehensive assessment of various factors tailored to the company's unique operations.
For larger enterprises with frequent business expenses, a corporate card program can streamline purchasing processes, enhance expense tracking, and provide centralized control over spending.
Conversely, smaller businesses may opt for corporate cards to establish credit, manage cash flow, and separate personal and business expenses effectively. Assessing spending patterns, employee needs, and desired levels of expense control are critical considerations.
Additionally, evaluating the compatibility of corporate cards with existing financial processes, such as integration with accounting systems and adherence to company policies, ensures seamless implementation.
Ultimately, the decision to adopt a corporate card program hinges on the company's specific requirements, financial objectives, and operational priorities.
How do Volopay corporate cards make managing business expenses easier?
Volopay corporate cards offer a comprehensive solution for businesses, simplifying expense management with their advanced features. With real-time tracking and automated reporting, businesses can effortlessly monitor expenditures.
Spending controls and budgeting tools enable effective cost management, while virtual prepaid cards ensure secure online transactions. Seamless integration with accounting tools streamlines financial processes, leading to faster expense reimbursements and improved visibility and control over company spending.
1. Real-time tracking and automated reporting
Volopay provides real-time tracking of expenses and automated reporting, enabling businesses to monitor spending efficiently. With instant access to transaction data, businesses can quickly identify trends, analyze expenses, and generate detailed reports for better financial insights.
2. Spending controls and budgeting
Volopay allows businesses to set spending controls and budgets, ensuring adherence to financial plans. By establishing limits on card usage and allocating budgets for different departments or projects, businesses can effectively manage expenses and prevent overspending.
3. Virtual prepaid cards for secure online payments
Volopay offers virtual prepaid cards for secure online transactions, minimizing the risk of fraud. These virtual cards are issued instantly and can be used for online purchases, subscriptions, and vendor payments, providing enhanced security and flexibility for businesses conducting digital transactions.
4. Seamless integration with accounting tools
Volopay seamlessly integrates with accounting tools, streamlining expense reconciliation and reporting processes. By syncing transaction data with accounting software, businesses can automate expense categorization, reconciliation, and reporting, saving time and reducing errors associated with manual data entry.
5. Faster expense reimbursements
Volopay expedites expense reimbursements, enhancing cash flow management for businesses. With Volopay's streamlined reimbursement process, employees can submit expenses easily, and finance teams can review and approve reimbursements promptly, ensuring timely payment and improving employee satisfaction.
6. Improved visibility and control
Volopay enhances visibility and control over expenses, empowering businesses to make informed financial decisions.
By providing real-time access to spending data, customizable reporting tools, and proactive spending alerts, Volopay enables businesses to track expenses closely, identify areas for cost optimization, and maintain compliance with company policies and budgets.
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FAQs
Yes, corporate cards allow customization of spending limits and controls for individual cardholders, enabling businesses to tailor card usage according to roles and responsibilities.
To apply for corporate cards, businesses typically need to submit an application form along with relevant business documentation such as incorporation certificates, financial statements, and employee details.
Yes, corporate cards can be used for international transactions, and foreign transaction fees may apply. These fees usually range from 1% to 3% of the transaction amount.
Many corporate cards offer rewards or incentives such as cashback, travel rewards, or discounts on business-related purchases, providing additional value to businesses.
New corporate cards can be issued quickly for additional employees or replacements, usually within a few business days, depending on the card issuer's processing time.
The process for disputing charges or reporting lost or stolen cards typically involves contacting the card issuer's customer service immediately to freeze the card and initiate an investigation or card replacement.
Yes, corporate cards can be linked to specific projects or cost centers for tracking expenses, allowing businesses to allocate spending and monitor budgets effectively.