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What is a corporate credit card and how does it work?

March 30, 2023

When your company is experiencing year-over-year growth, your business is profitable and your revenue increases every quarter. It's time to think about transitioning your financial tools.

Research conducted by Censuswide examined expense processes by questioning 1,242 employees' preferences and found that 16-34-year-olds were most likely to prefer business or corporate cards over personal cards, at 55 per cent – the largest of any age group.

The survey also revealed that just six percent of employees at mid and larger size companies are required to use business cards. This means that most employees have to use their own credit cards for business expenses. An increasing number of young workers say that the cost of living makes them want a company-paid card for their business expenses.

For businesses looking to kick things up a notch, here’s a rundown of how corporate credit cards work.

^{What Is a Corporate Credit Card?}

Corporate credit cards are cards that let employees pay for authorized business expenses while offering features that make it easier for companies to manage and track finances. For example, businesses may have access to tools and resources like dashboards to help track and control employee spending, and the finance team usually get access to

The biggest benefit to a corporate credit card is that individual employees can be issued their own cards to handle their work-specific business expenses. Whether it’s paying for plane tickets or renting office space, having a corporate credit card can make handling business expenses for a business much more efficient.

^{How Do Corporate Credit Cards Work?}

Corporate credit cards are designed to meet the needs of companies that desire more full-bodied, customizable financial tools to track and control employee spending. Companies use corporate credit cards so that employees can charge authorized business expenses, such as hotel stays and flights, without relying on their own credit cards or cash.

The cards are issued based on the company’s financial health—not the owners’ personal finances. Card issuers may, for example, require the company to have strong financials, plus good liquidity and cash flow. Some companies have strict requirements to open up a corporate credit card account, such as at least $4 million in annual revenues, 15-plus card users, and projected charges of $250,000 or more each year.

However, iPeakoin's card service is available to businesses of all sizes. No matter if you are a small and medium-sized company, or a large enterprise, you can get access to iPeakoin's corporate credit cards at any time.

^{What Are the Benefits of Using a Corporate Credit Card?}

One of the most significant benefits of using a corporate credit card is how much easier it makes it to manage expenses for both the employer and the employee.

Easier expense management

Corporate cards remove the burden of paying for all expenses upfront and then having to navigate the reimbursement process. Employees simply shouldn't have to use their personal card for business expenses, and don't need to wait to be reimbursed.

Ability to set spending limits

A corporate card allows employers to place limits on how much cardholders can spend per transaction, per spending category, or overall. The company can also control where a card can be used, limiting purchases to specific merchants, types of merchants, and locations.

Rewards programs

Another employee benefit that depends on corporate policy is the ability to accrue rewards or cash back while using their corporate card. While not all companies allow individual card holders to do this, it can be very popular.

Easy expense reporting

For those teams that still have to file expenses, the best company cards make it easy to save receipts and file quick reports. iPeakoin, for example, lets you do this directly from one dashboard. Budget managers see what's spent in real time, and finance teams always have the receipts they need for month-end closing.

^{The takeaway}

If your team spends a lot of time on tracking and filing reimbursements, it's time to use corporate credit cards.

Get digitized expense reports, instant receipt capture, faster card reconciliation, and access to your full payment history in real time.

Everything you need to control company spending and let your teams do their best work, faster. Get started today ipeakoin.com/quantum-virtual-card