Sixty-five percent of small and growing businesses use credit cards in the US. Why? For a start, they can offer great business benefits like cash flow management and flexibility. They also often come with other juicy rewards too, including cashback, air miles, or points. But as they say: ‘there’s no such thing as a free lunch,’ and in this article, we dig into how much value the added benefits might offer — and how to issue and use them while keeping a tight grip on business spend.
With small and growing businesses spending over 20% more on corporate credit cards since the pandemic, credit cards are more popular than ever. But with "great spending power" comes "great responsibility" — as global spending on corporate credit cards rises, it becomes crunch time for robust spending policies and compliance.
Before you start dishing out corporate credit cards, you should go through the terms of the credit card provider with a fine-tooth comb to check who’ll receive the rewards and how to redeem them.
You’ll also need to create (and implement) your own credit card policy to ensure there are no grey areas when it comes to using the cards or their rewards. Corporate credit card misuse is an ongoing risk. It’s worth checking if your credit card provider (or a connected expense solution) can offer you in-built customizable card controls and approvals to help make adoption and compliance easy for your spenders.
In some cases, your company may insist that your people only use the rewards for business travel expenses, mileage, per diems and other company expenses. But in others, your business may view them as an added ‘personal benefit’ and let people use them however they want.
It seems obvious, but be careful to check if any of your free benefits are actually ‘free’. If you’re paying a big premium for your cards, you’re paying for the rewards. No judgment here if that’s part of your plan for employee satisfaction and retention, but it’s always worth keeping an eye on, especially when juggling many other finance tasks.
Using or choosing which provider? Here are five creative strategies to make sure you make the most of your corporate credit cards and their added benefits (without losing control of spend).
Many business credit cards offer sign-up bonuses. These bonuses vary widely but typically include rewards like:
Any idea what takes corporate cards to the next level? Connected corporate expense management software that lets you set card controls, like spending limits and approvals, and auto-capture data for real-time reconciliation.
Look for a solution (like Payhawk) that can support your corporate credit cards and also take care of bill payments, subscription management, multi-entity management, procure-to-pay, and more. Don’t make life harder by choosing a different tool for every purpose. Ride the second wave of digital transformation and discover spend all management – all in one.
You can normally unlock credit card rewards at pretty much any time (observing restrictions, limits, and expiry dates). But, at times of high demand (holiday seasons, beginning of the fiscal year), you can likely save more on your corporate card purchases than usual.
Let’s imagine your card provider gives a once-a-year 10% flight discount. You will squeeze the most value from it by waiting for the most expensive periods to cash in and take flight — summer, Christmas, etc.
Credit card issuers frequently offer limited-time promotions and bonuses to get people reaching for their plastic, with offers typically cropping up in the low seasons, like Spring or Autumn.
Sign up to email notifications and check the issuer’s social media profiles to see if there’s anything new and stay ahead of the best offers.
Card issuers also include these in their terms and conditions, notifying their users directly about the terms of the new offers. So, stay informed to reap the best benefits (even if that means occasional email you don’t need).
Often, corporate card issuers onboard a new client offer them a % cash back to sweeten the deal for the first few terms.
With the right planning and forecasting, this can be really useful for your business. If you only get cashback for your first six months, consider stacking your utility payments or one-off outgoings in that period rather than monthly, as you’ll get more back for every buck.
It takes careful planning, but it allows you to reinvest in your business for a short but impactful period.
There is no denying when it comes to Ts&Cs, the devil's in the details. As a financial professional, we know you'll cover every detail when it comes to the overall conditions of your credit card.
But when it comes to the reward program, here are the three most important things to keep in mind:
By taking the time to understand the terms and conditions of your rewards program, you can get the most out of your business credit card and make the right choice of credit card provider.
Ready to transform how you manage corporate expenses? Book a personalized demo with Payhawk today.
Trish Toovey works across the UK and US markets to craft content at Payhawk. Covering anything from ad copy to video scripting, Trish leans on a super varied background in copy and content creation for the finance, fashion, and travel industries.