Walking on thin ice can be dangerous, they say. Ironically, that’s what a lot of businesses do most of the time. They walk on financially thin ice. Every company is always looking for ways to better its’ financial operations. And that’s what exactly corporate credit cards do. They simplify the lives of businesses.
What is a corporate credit card?
Every business incurs expenses that are not made by the top executives but the employees instead. Over time, such transactions become difficult to track, which is when corporate credit cards come in handy. Corporate credit cards are usually given to employees who travel a lot or make frequent expenses on behalf of the company. These cards enable the employees to make business purchases without having to use their personal reserves.
Corporate credit cards allow business owners to track funds electronically. These cards are issued to employees based on their needs and roles. The cards are formatted in such a way that spending limits can be established and an employee may be denied a transaction if an expense is not business-related.
Wondering if your business needs a corporate credit card? Here are the top 5 benefits of this card which will help you decide:
The biggest advantage of a corporate credit card is that it allows for digitized payments. Business owners can easily keep track of employee expenditure and pull up any transaction from the past without requiring a printed receipt. These cards ensure seamless online payments and enhance the transparency of business.
Over time, transactions are recorded, and expense reports are generated. These reports help employers identify the areas where most funds are spent. A spending pattern can be noticed, and employers will have a better idea about when and where the most money is spent. Over time, this feature acts as a guiding light and identifies any excessive or unnecessary expenditure that can be avoided in the future.
Expense management and control
Employees can find it difficult to keep track of every business expense they make. Managing all the receipts in order to submit them and get reimbursed can be time-consuming and frustrating. This is where a corporate credit card jumps in to save the day because it digitizes every business transaction. There will be clear records of where the money is being spent and it holds employees accountable for their spending. It will relieve employees from the trouble of preparing excel spreadsheets to keep track of expenses. Employees will be able to spend more time focusing on their area of work instead of worrying about submitting receipts to the finance department.
Fraud prevention can be a concern for many businesses. A corporate credit card puts this concern to rest because every transaction happens electronically and can be traced easily. Payment may be declined if the card is used for a non-business purpose by the employee. In case an employee loses the card, it can be blocked straight away so there is no room for misuse.
Optimize working capital
Firms would like to have a sufficient amount of working capital to ensure the smooth sailing of daily business operations. A corporate credit card assists in this procedure by enabling cashless transactions. It gives employers about thirty to forty-five days to repay the credit amount. In this way, a lot of working capital is freed up because a corporate credit card digitizes a major chunk of employee expenses. Therefore, this money can be used elsewhere to increase productivity.
This card also gives flexible credit to businesses. The owners do not have to worry about paying for every transaction immediately. Once a company partners with a financial institution and issues corporate credit cards to its employees, it will follow a “spend now, pay later” policy. This would take a lot of stress off of employees and as well as business owners.
When employees are sent on business trips without a corporate credit card, they would have to dig into their personal reserves for business purposes. This would lead to them having lesser funds temporarily. In such a situation, employees may start cutting corners on essential company expenses in order to avoid sacrificing their personal funds. Another drawback is that employees will have to wait for days to get reimbursed for spending their money.
By issuing corporate credit cards, the employees would be relieved from the stress of using their money. They would be able to carry out financial activities more efficiently and effectively. They will also be in a better position to take faster financial decisions which leads to higher organizational productivity. This will empower employees and give them a sense of security with the company they are working in. As we know, happy employees are productive employees!
Rewards and benefits
Corporate credit cards offer a number of benefits that employees can redeem as a result of their hard work. When they are used over a period of time, there will be accumulated reward points that can be redeemed by the cardholder. Apart from these rewards, there are benefits such as access to airport lounges, discounts at outlets, and gift cards that motivate employees to use the cards more often. They are ideal for businesses because they help the employers have transparency in financial activities and also incentivize employees to follow a more systematic platform of business operations. It’s a win-win situation!
Why startups and SMEs should consider using a corporate credit card
In general, corporate credit cards were designed for the use of larger corporates with a higher number of business transactions. But they can also be immensely useful for startups and SMEs to help stabilize their financial operations.
A corporate credit card may come in handy to monitor day-to-day expenses in startups and SMEs. The founders and top executives of small businesses can use this card to free up working capital. Monthly expenses such as business dinners, digital marketing, utilities, office supplies and much more can be taken care of in a digitized and orderly manner.
One such card introduced to help ease the lives of small business owners is the Founders’ Card by Zaggle. The Founders’ card is a more personalized corporate credit card designed for the use of Founders and top executives of startups and SMEs. This card is especially useful for founders who are constantly traveling abroad because it comes with a Forex Wallet as well. They can avail benefits such as access to premium lounges, discounts on air travel, and much more. So, if you think your startup or SME is in need of a corporate credit card, do give the Founders’ Card a shot!