Corporate cards have been around for decades, and many companies will have a number of central cards for vendor payments. However, it’s still extremely common for individual employees to use personal cards for travel and out-of-pocket expenses. Organizations may have not wanted to deal with the administrative burden of managing traditional cards. They may also have been worried about unauthorized spend. The introduction of modern programs has virtually eliminated all these concerns and removed many of the traditional barriers to adopting corporate cards.
Widespread adoption of business cards can improve the end-user experience and be a central part of an organization’s cost control initiatives. Here’s how:
Corporate cards can be easily issued and managed by the finance department within a central dashboard, instead of having to work through the card issuer. Administrators can create virtual cards or physical cards in real time. They can also add or remove users, or change users’ spend permissions, as needed. Cards can be set up for one-time use (for buying a certain item with a specific vendor), or can be issued in advance of a specific event or business trip. Issuing virtual cards enables immediate online purchases, and also allows users to add them to their mobile Apple or Google Wallet.
Corporate cards can be configured with a wide range of controls that reflect an organization’s expense policy to minimize unapproved spend. This can include per-transaction or per-day/week limits, restrictions on merchant categories or specific merchants. Cards can also be set up so they can only be used at certain times/days, or can expire on a certain date. This enables organizations to minimize their financial exposure, and avoid having to pay for out-of-policy spend. These policies can also be enforced so different employees have different rules. Cards can even be tied to spend pre-approval requests, so only purchases which have been authorized in advance can be made.
Card reconciliation no longer requires cross-checking each item on a card statement against the cardholder’s expense report. Integrated card and expense solutions make it easy to match the transaction receipt with the card data, by sending real-time alerts that prompt cardholders to capture receipt images. These are then matched using data extracted from the receipt using optical character recognition. This automatic matching eliminates the need for card admins to verify spend, saving countless hours of manual labor.
Corporate cards offer a cash rebate, which can often be 1-2% of overall spend. Issuing cards across the organization and channeling individual and corporate spend through these cards can easily lead to five- and six-figure rebates for mid-size organizations. Organizations which still use manual, spreadsheet-based expense processes may find that the rebates from widespread card adoption could pay for an expense automation solution in itself. This alone could pay for a corporate expense management software solution.
It’s not just the organization itself that benefits from corporate cards. They can also have a considerable positive impact on the cardholders themselves. Eliminating the need for employees to cover expenses and then wait for days or possibly weeks for reimbursement can be a considerable relief. This is especially true for those who may traditionally submit large expense bills, or have less available cash to cover card bills. It also cuts out the possibility of over- or under-reimbursing employees for foreign transactions, when there is exchange rate fluctuation. When cards are combined with the expense management software solution, the automated spend reconciliation outlined above could also take the expense process from hours down to just a few minutes.
Of course there are other “soft” benefits. With virtual credit cards, employees avoid touching surfaces - thanks to the ability to use their phones mobile wallet feature. Virtual cards can be added to Apple and Google Wallets, so they can be used for touch free payments. While we’re still in the COVID-era, minimizing the need to touch a card POS terminal can help cut the potential for virus transmission.
If you’re considering adopting a corporate card program, or want a program that works better for your cardholders and finance team, get in touch so you can see a demo of how Emburse Cards and our expense management software solutions can help your organization.