What is a company card?

Company card, business card, or corporate card – there are many names for it.

The card is used for expenses and payments related only to the company. As opposed to personal credit cards that are used in private circumstances. Unless the company does not issue company credit cards. Then the employees have to use their personal credit card and afterward get reimbursed. This is also referred to as an outlay.

Companies of all sizes can have a company card. It is convenient and helps your company build better credit, providing more favorable future loan opportunities. It is often necessary to provide a personal guarantee, for example, when smaller or start-up companies apply for a company card.

It is a smart way to generate invoices because transactions are automatically accounted for.

How does a company card or business credit card work?

You apply for a company card in the same way as a regular payment card.

Several different lending institutions offer company cards, and as a borrower from a company, you can apply for a card with or without an employee ID. This allows all companies, large and small, start-ups and established, to apply for a company card.

Efficient handling of company expenses

A company card can help your company efficiently manage typical expenses, making it easier to manage overall expenses. The accounts become significantly more manageable and less cluttered with receipts and payments from your company’s employees.

Connecting the card to a business account ensures a clear and transparent overview of your company’s expenses. The company card can also be used as a tool to build your company’s credit, which is especially advantageous during quieter periods when the company has different sources of income.

After using a company card for a more extended period, the company will have built up a credit that makes it possible to apply for a larger loan sum from banks and lending institutions than was possible at the outset. Thus, a company card can be a stepping stone for developing smaller businesses.

Advantages and disadvantages of a company card

If you are still deciding whether your company should use a company card, you can learn about the advantages and disadvantages below.

Advantages:

• Financial control: It allows the leader of the company to better keep track of employees’ expenses, so they can ensure that the budget is being followed.
• Efficiency: It is easier for employees to make a purchase, as they do not have to carry cash or personal cards for expenses.
• Traceability: Tracking and reporting expenses is more manageable, as all transactions are linked to a specific card and can be traced back to a particular employee.

Disadvantages:

• Abuse and fraud: With any payment solution, there is a risk of fraud, and this also applies to company cards, where an employee may misuse the card and use it for personal purchases.
• Fees: There may be annual fees or transaction fees associated with having a company card.

Give your company card superpowers

It is possible to let a company card “handle” expense management and accounting – at least to a large extent. This is done by digitizing the expense journey from the moment it arises until it is bookkept.

You can connect Acubiz to your company card and financial system, where all transaction data is automatically and digitally prepared for accounting so that you can avoid manual work.

Acubiz works via three simple steps:

1. Fetches transaction data from the user’s company card.
2. Facilitates the attachment of information and documentation.
3. Delivers accounting-ready data to the financial system.