Leveraging The Best Suited Expense Payment Methods For Your Organization
Today, there are numerous corporate payment methods available and selecting the right payment method for your unique enterprise can be a challenging task. Corporate credit cards have historically been the best choice for the business travelers as they are easy to use on the go, but alternative payment methods are also gaining popularity with technological advances.
Are Corporate Cards Really That Powerful?
Corporate cards are very easy to use, you get periodic consolidated statements for the expenses and gain real-time visibility into the spending pattern of a business traveler along with that taking advantage of rebates (if any) and special pricing available to the organization.
When there is more expense visibility, organizations can look out for better rates because they are well aware of the volume of business that they provide to a vendor and also know the gaps in the service. It is considered to be the simplest choice as most of the systems take advantage of the payment method.
Why Personal Cards Should be Used?
Using personal cards, cash, supplier invoices, and cash advances is a non-corporate expense payments method and is used mostly for meals, hotels, ground transportation for the lower value of purchase and eases the traveler’s way of using it.
But these modes of payments also have many risks that vary from fraudulent activities to the lower visibility of data spend that will affect business negatively.
However, there is one benefit for organizations allowing business travelers or employees to use their own personal cards is that since they are spending their own money with each expense, therefore their spending will align with the policy of the organization.
Importance of Virtual Credit Cards
Recently, virtual credit cards have gained popularity among business travelers and are often chosen as a preferred payment method. There were certain limitations for the virtual cards such as, before using it in business they need a fax authorization that prevents adoption by business travelers and companies.
But with technological improvement, all these limitations have been dropped, allowing organizations to use virtual cards to pay for things such as accommodations and transportation at a fixed cost.
Although, both corporate and non-corporate cards are quite popular in their own way, still these methods have limitations in certain situations. For instance, if a candidate is traveling to the companies headquarter for an interview, then the cost is not cut from corporate cards liability and visibility standpoint while enforcing company expense policy.
In this scenario, virtual cards can be used for a single transaction and expenses can seamlessly be linked back to accounting.
The Bottom Line
Companies should thoroughly analyze the spend patterns of traveling employees and should select and use payment methods that are best suited for their business in the long run. The payment modes should offer the organizations some sort of vendor discounts and rebates calculated on the incurred expenditure and help in reduction of cost.
Also travelers should be aware of the company’s expense policies and payment modes as they will be useful while spending during the business travel.
