Creating an effective corporate credit card policy in four steps
Creating your corporate credit card policy doesn't have to be complicated. And for many businesses, setting an effective card policy (and achieving better spending control using corporate cards) starts with these four steps:
- Decide what types of purchases should (and shouldn't) be allowed with company funds and decide who needs access to those funds for them to do their job effectively.
- Speak with legal counsel or other finance experts before finalising anything so that you can double-check that your policies are up-to-date with current laws and regulations surrounding business spend management in your region. Here's an example of such guidelines provided by the UK government.
- Determine the exact parameters for your spending policy, such as spending types (commuting expenses, business trip expenses, office supplies, etc.) and how much employees can spend on each per month. Determining who would report on expenses (and approve them) is also crucial at this step. This process can take ages if done manually, so we recommend you consider using a business spend management solution.
- Make sure you communicate the new policy clearly throughout your organisation to ensure a pain-free adoption process and good compliance.
Once you've nailed these four important steps, you'll have all the information you need to set up and distribute corporate credit cards to your relevant teams and individuals.
Bringing in the experts
Take some time now to create a comprehensive corporate credit card policy explicitly tailored to your organisation's needs. This work will save you from any headaches if issues arise related to improper use of cards, overspending by employees or vendors, and human error.
Plus, consider bringing in the experts, as your corporate card policies will only be effective if your team adopts them. Using a corporate spend management platform lets you automate a good chunk of work, from card issuance and controls to reporting and accounting system reconciliation.
With Payhawk, for example, the corporate cards and connected software mean that spend policy is built right into the tool employees use to pay. This means that employees can stay compliant more easily and don't have to search around for their company's rules and regulations.
Payhawk customer, Mercell explained how crucial built-in spend policies are to their business. Now, the finance team can effectively encourage compliance to company-wide regulations by implementing widespread policy adjustments.
Leon Steenbrink, CFO at Mercell Nederland explained:
"My favourite feature is having the ability to assign spend policies to employees. I like it because it empowers employees to perform their job function without having to ask for permission to spend money that they have already budgeted."
Ready to learn more about setting spend policies and controlling spend? Book a demo today.