What Are Corporate Payment Cards? Meaning And How Do They Work?
Dec 01, 2020 - 10:15 AMAuthor - Kenneth
Nowadays most of the growing or multi-national companies use corporate credit cards for their employees, for example, hotel bookings or airfare, etc. so that they can handle their business-related expenses without having to use their own card or cash. These cards, which are also known as commercial credit cards, make it easier for both employees and employers to handle and keep an eye on business expenses in an efficient and organized way.
What Is A Corporate Payment Card?
Also known as corporate credit cards, corporate payment cards are the cards which are issued to specific employees by their employer to manage business-related expenses. Whether the employee needs to fly or need a card to reserve plane tickets or purchase office supplies, providing them a corporate credit card is the best way to keep track of expenses and make it easy for the employees to buy what they need.
1. Corporate credit cards make the procedure of keeping track of business expenses easier for both employees and employers.
2. They are generally issued to larger and established companies. It is different from business cards available to sole proprietorships and DBAs.
3. Before using these cards, the employees need to learn and follow the company’s corporate credit card policy.
How does a Corporate Credit Card work?
Corporate Payment Cards Service For Corporate Clients is designed to cater to the needs of established companies especially with at least $4 million in annual revenues. The major corporate credit card issuers include American Express, Capital One, Citibank, and Wells Fargo, etc. The cards are issued based on the company’s financial stability instead of the owner’s.
1. The procedure of using them is quite similar to using a personal credit card. The employers can use these cards for basic business expenses such as accommodation and flight bookings etc.
2. Like personal cards, corporate credit cards can be used at the counter or for online payments during business travel.
3. The payments which are being made through them are registered on the company’s card statements.
4. It is one of the most convenient mediums for the company to pay for the employee’s business expenses.
5. The issuers of the corporate credit cards often evaluate the recently audited financial statements of the company as well as details about the company’s structure, tax information, and contact information, etc.
Types of Corporate Credit Cards
Depending on the type of corporate credit cards, the responsibility of paying the credit card bill will be decided. The cards are categorized into individual liability cards and corporate liability cards.
1. Individual Liability Cards: In this type of card, the employee is responsible for paying the credit card issuer for any type of charge. It also includes filing an expense report and a reimbursement form from the employer. The credit card issuer checks the personal credit score of the employee but it is unaffected by their card usage.
2. Corporate Liability Cards: In this type of card, it is the employer who is responsible for paying the bills for approved charges. Since the company is responsible for paying, the credit card issuers typically do not check the employee’s credit.
Corporate credit cards make it easier to manage business expenses for both employees and employers. Emerio Banque is a trusted private financial institution providing effective and reliable business payment solutions for corporates at affordable rates.