What every employee should know about your corporate card policy

Corporate cards can make life easier for everyone in a company. They mean that business expenses can be settled quickly and efficiently, with an easier admin process for the financial team and better control of spending. There’s just one thing that’s vital to get in place to ensure this process is frictionless: a thorough understanding among all employees of what is and isn’t acceptable when it comes to company expenses.

No one wants to be reprimanded or worse for stepping outside the bounds of such a policy because they didn’t absorb this information when it was delivered. And it can be tricky for managers to navigate grey areas if the corporate card policy was never fully clarified. By making sure that everyone is on the same page from day one, this type of complication can be avoided, so that business expense management remains smooth and effortless.

What is a corporate debit card?

A corporate debit card is a payment card issued to a company’s employees to cover work-related expenses, such as supplies, equipment or travel. This means that team members don’t need to use their own money and claim reimbursement later on.

Corporate debit cards vs corporate credit cards

Corporate credit cards usually charge interest, and can require a higher credit score. That’s because the funds being spent are lent by the card issuer, and have to be paid off in a certain timeframe. When using a corporate debit card, on the other hand, the money spent is being drawn from funds held in a business bank account. For this reason, it can be easier to qualify for a corporate debit card, even when a company is smaller or newer, and there is typically no interest to pay.

Virtual vs physical corporate cards

Before the digital era, corporate cards were always physical objects, which could be swiped, tapped or inserted into a chip-and-PIN machine in stores. Now, it’s possible to generate virtual corporate cards. These are a set of card details – card number, expiry, security code – assigned to an employee that can be used to complete transactions online, or via a mobile wallet.

Because there is no physical object associated with a virtual card, there is no need to worry about it getting lost and stolen while out and about. Virtual cards can also be created and cancelled instantly, so there is no waiting around while new employees are onboarded, and no delay if a card needs to be immediately shut down due to suspicious activity. Card limits can be set in order to keep control of spending, and they can even be locked to a specific vendor.

Many companies opt for a mixture of physical and virtual corporate cards, as physical cards have their own benefits. They are sometimes required as proof of identity when booking travel arrangements, and can be used to withdraw cash from ATMs. If a card is being issued purely to order a software subscription from a single vendor or to order supplies online, a virtual card may make more sense.

How to create an effective corporate card policy 

A corporate card policy should be robust enough to protect company assets and promote responsible spending, and flexible enough that it gives employees the autonomy they need to get their job done smoothly. It should also be clear and fair. Here are some of the key elements to include in your company’s corporate card policy:

• Outline cardholder responsibilities. Make it clear that the employee is responsible for keeping card details secure, and they may only use the card for company expenses.

• Impose spending limits. These can be determined by the cardholder’s role, and can be specified on both a per-item and cumulative (e.g. monthly) basis.

• Communicate when approval is needed. It’s common for certain types of expenses to be incurred without approval necessary, but specify what types of spending need to be signed off beforehand and how this will work. For example, stationery orders may not need approval when using a certain corporate card, but international flights may.

• Are there any exceptions? Specify if there are any foreseeable scenarios that may be exceptions to the rules, such as emergencies when travelling abroad.

• Specify how to track spending. Explain the procedures employees should follow when submitting expense reports, or whether this spending will be automatically tracked by the card issuer. Some employees may be asked to take photos or screenshots of all receipts and upload them to an expense management platform. Others may be told they can waive this requirement for expenses that are less than a certain threshold.

• Provide practical instructions: Explain to employees how exactly they should obtain and activate a new corporate card, as well as how to cancel them if needed, or flag a problem.

What to look for in a corporate card 

When choosing a corporate card there are certain key benefits that should be explored. Take some time to think about the result you wish to bring about, in terms of time and money saved and stress reduced for your team. Here are some of the main points to consider:

Security measures and fraud prevention

Your corporate card should come with state-of-the-art security technology and anti-fraud measures, no matter where in the world it is used. Virtual cards can be particularly strong in terms of security because of the reduced opportunities for theft or cloning. They can also be instantly cancelled and replaced if any suspicious activity takes place. Look out for cards with the following security measures:

• Real-time transaction monitoring: Some card providers allow you to track purchases in real time. This means you can immediately detect unusual spending patterns that may indicate fraud.

• Multi-layered approval workflows: This enables you to ensure expenses are signed off by the right people. 

• Spending limits: Choose a provider that allows you to put spending limits on cards. These can include per transaction limits, merchant category limits, or limits on the amount that can be spent within a set timeframe. 

• Instant card freezing: Your provider should allow you to instantly freeze or cancel cards if you notice any suspicious activity, or if the card is no longer in use. 

Powerful expense management

Another benefit to look for in a corporate card provider is the ability to automate and streamline expense management, to free up your team’s resources and stay organised.

Employees should be able to capture and upload receipts on the go and enter their expenses seamlessly on your expense management platform. Managers should be able to quickly review and approve expenses digitally, have all the information they need in the same place, and receive notifications if wanted to ensure there is never a delay.

A corporate card with a robust expense management system will be able to automatically sync expense data with your accounting software. This ensures that finance teams are always up-to-date with company expenditures, and no unnecessary effort is being wasted when reconciling accounts.

Multi-currency spending

Multi-currency cards are a great choice for businesses that operate globally. They allow you to spend in multiple currencies from held balances in your account, meaning you can avoid unnecessary foreign exchange (FX) fees.

If you have offices around the world, it makes sense to choose a provider like Airwallex, which allows you to issue multi-currency cards to your global employees, no matter where they're based. That way you can keep track of all company spending on a single platform

Educating employees on card policies

Training should be provided for employees on how to further boost card security. Consider hosting regular training sessions to educate the team on potential fraud risks and responsible card usage. Emphasise the importance of:

• Keeping card details confidential

• Reporting any suspicious activities promptly

• Swiftly cancelling lost or stolen cards

Airwallex: Corporate cards with superpowers

Thoroughly educating your employees on your corporate card policy is a crucial part of expense management. What’s even more important is to choose the right corporate card for your business. 

Airwallex offers both physical and virtual Borderless Cards that come with in-built expense management. Cards can be created in minutes and are usable anywhere Visa is accepted, online and in-store. All purchases can be monitored and approved from a single platform in real-time.

Airwallex cards are multi-currency, so purchases can be made in multiple currencies from held balances in your business account. That means no more surprise foreign transaction fees. For more efficient financial management, sign up for an Airwallex account today.