The Benefits of Virtual Company Cards
The management of employee expenses has long been a contentious issue.
16:03 04 February 2020
Millennials do not expect to pay for company expenses out of their own pocket and neither should they, but the use of a company credit card, which gets passed around to whoever needs it, is fraught with problems. A company credit card, for which no one person takes responsibility, is an invitation to misuse and overspending.
A virtual company card is a randomly generated number which is linked to a credit account and which can be issued to all employees. The card is loaded with a set budget, either for single use or multiple use.
Track employee spending
All spending on a virtual card can be tracked in real time either by means of desktop software or a mobile app. Employees simply photograph receipts or tickets and upload them via the mobile app. The employer can see exactly what is being spent and where, as it happens, and at the end of the month the employee will receive a PDF showing all transactions, including pictures of receipts.
Complete budget control
The employer controls how much money each employee is given access to. The employee cannot spend more than has been loaded onto the card. This allows for complete staff differentiation, from the most junior to the most senior. The employee can also impose specific spending limits under headings such as ‘food’ or ‘accommodation’. Budgets can be increased or decreased by the employer, or the card can be frozen without the need to freeze an entire account.
Convenience and financial autonomy for the employee
In the past an employee was often expected to meet expenses out of their personal finances, save receipts and tickets, submit a claim and wait to be reimbursed. This time consuming and inconvenient process encouraged employees to over-claim, based on a feeling that their inconvenience justified a little extra. A virtual card is convenient and time saving. Giving your employees the autonomy to manage their expenses builds trust and responsibility, and is an important contribution to job satisfaction and motivation. ‘A recent study by Forrester found that 53 percent of organisations are prioritising their employee experience in the next year’.
When an employee uses a conventional company credit card online, they are potentially giving a hacker access to the billing address, card number, expiration date and security code. A conventional credit card can give hackers direct access to your company bank account. A virtual card is not linked to your bank account and therefore it cannot be traced and since the card is non-physical it cannot be cloned, lost or stolen.
No longer is it necessary for finance departments to waste hours collecting and collating receipts from employees. Virtual cards allow for the collection and collation all data, digitally, and the information can then be fed directly into the company’s existing accounting system.