Life before company cards, can you remember it? Maybe you're a finance manager who's still struggling to navigate it. First, you need to have a secure place for your business cash, a very conscientious and thorough set of employees who know when and where they're spending, and who will record every purchase and keep the proof.
Without company cards and appropriate expense management software, no doubt you'll be pulling spend data together from random places. Then recording it in some expense software - that's hopefully connected to some reporting/ERP software. And, what about your policies? Do you ping emails out to remind your staff how much cash they're allowed to spend in the budget? What if they need more? Are they saving that information on a spreadsheet? It's a mess.
Back in the 1950s, company cards let people, primarily salespeople, pay without cash limitations at places where they couldn't use their bank directly. How amazing that must have been at the time. A massive leap towards simplification and efficiency for the vendor and the user.
Payments stayed the same then, for quite a while, until the dawn of the internet. Over time consumers could purchase a few things online, then a few more, all the way up to now, where you can buy literally anything at the click of a button. Online shopping made paying with cards a necessity, and consumers' habits changed accordingly.
But what about company cards?
Corporate processes took longer to catch on. As new technologies, like digital wallets, grew in popularity for B2C, corporate payments and expenses should have followed, but they didn't. The dawn of digital banks seemed promising; finally, there would be simpler, more automated processes for corporate finances. But what we ended up with was the same old company card, just with fancier clothes. For most businesses, managing company cards and payments still feels complex. It seems that all the integrations available — thanks to APIs (digital interfaces) and automation options — are just not enough to connect all the tools you use as a finance manager.
Company cards from legacy banks
Company cards make business payments easier. You have data showing who's spent what and where. Plus, your employees are empowered to spend as they need, on the go, But what about expense management? What about bookkeeping, reporting, and forecasting?
Here's how company cards get issued at legacy banks and providers:
You, as finance manager, work with stakeholders to decide who's allowed to have a company card and what the limits will be. Then you ask the bank to send your card or pick it up in person. Once your colleagues have started using their cards, they'll need to categorize their receipts and send them over to the accounting or finance team. That's if they haven't lost them. Then your accounting team will review them all to try and reconcile them against spend, and complete the bookkeeping at the end of each month. Then, 45 days later, yep, 45 days, you'll get access to the data so you can check the actual budget against the forecast and look for ways to optimize spend.
It's hard to keep track of who is spending what in this scenario, and two things can happen. Either your company has one or two cards that they share with the whole team, or employees use their personal cards instead, and they get reimbursed later on. Creating another nightmare for your accounting team.
What's wrong with this picture?
For a start, everyone's time is wasted. You didn't hire your sales team to manage business payments and complete expense reports. There are much more valuable uses of your accounting team's time than investigating every missing receipt, too. Especially when they could be using that time to find ways to optimize your organization's spend and finances. And what if all these receipts and invoices need to be entered manually? And categorized again? It's a long, manual process, and it doesn't need to be.
Time's definitely wasted, but what about money? The annual card fees you pay to your bank aren't saving your business any money. Plus, there are fees for currency exchanges and withdrawals. And fees for making changes to limits, or owners, or breathing. Take a look at our ROI calculator here to see how much of your company's time and money you could save when it comes to expense management.
Finally, there's an often unseen issue with auto-renewal too. If your employees have signed up for essential software subscriptions for their jobs, that's great. But when they don't need them or change providers, and they forget to cancel — along comes the auto-renewal. Auto-renewals create a big overspend problem for organizations, and the company cards from legacy banks don't consider this.
The all-new company cards
Thanks to regulations such as PSD2 and Open Banking in Europe, and similar elsewhere, banks are now obligated to open their information systems, and the market is overflowing with new players. According to data from Capgemini's Open Banking Market Observatory, there were 345 PSD2-licensed third-party providers (TPPs) from 26 EU countries in September last year. Most of these new players are helping consumers manage their finances, and less than 100 of those are supporting businesses.
At Payhawk, as a technical service provider under PSD2, we believe that we've created the ultimate company card for your business, including the software that allows your expense management headache to be a thing of the past.
First, as a software company, we focused on creating the best platform, OCR and mobile app to eliminate manual data entry for everyone in your team, from the spender employee to the bookkeeper.
Then we partnered with the best card issuer to have an outstanding card with the lowest exchange fees and acceptance everywhere. We then added endless features so that you can use Payhawk as your all-in-one finance tool, from issuing cards in no time to invoice payments and real-time company spend control at your fingertips. All this and now our latest feature, reimbursements.
Reimbursements allow your business to experience the benefits of different forms of payment. You have the option to use both the Payhawk company card and for employees to pay with their personal card when the need arises. Those who use their personal cards can scan the receipt via the app, add their personal bank account information, and the reimbursement is done in no time.
"We've tried to connect multiple software solutions, payment methods and information medium breaks (from digital to paper to digital) to create a seamless expense management experience," Hristo Borisov, our CEO, explained. And it's not just us who think that we've created a stellar product; our customers and investors and their continued trust shows they do too.
Saving time and money is one of the major benefits of having company cards in your business. It helps you simplify and automate mundane processes to give you back productive time. It also gives you complete visibility and real-time control of company spend. And don't forget the most important benefit, your employees feel empowered to do their jobs.
From a big picture perspective, the digital agenda is becoming increasingly critical in the corporate world. Whole economies are going cashless, and businesses can't afford to be left behind. Your business can benefit from being ahead of the game by having a cashless company and hopping on the digitization wave. Download our ebook How to build your cashless business here to learn more about taking cash out of the equation in your business payments and expenses. Or, if you're ready to surf the wave with us, book a demo here.
An integral part of Payhawk's inception, Raquel has seamlessly transitioned through various roles, beginning in sales and pioneering the customer success team. Her journey continued into content and product marketing, where she now excels as a Product Marketing Manager. Despite managing two maternity leaves, Raquel's vibrant spirit thrives outdoors, embracing activities like hiking, cycling, global travel, and creating cherished moments with her two children.