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Other Business Card Options

Other Business Card Options

Vectra Bank Colorado also offers the Visa® Commercial Credit Card and the Visa® Debit Card for businesses.

Visa® Commercial Card1

Benefits of mandating T&E expenses through a Commercial Card Program.

Travel and entertainment (T&E) is consistently one of the largest operating costs a business can incur–second only to salaries and benefits. Applying skillful decision–making to the way T&E expenses are managed can help improve a company's bottom line through control and cost reduction. A mandated Commercial Card program for T&E can be an effective tool to control policy adherence, address employee satisfaction, reduce supplier costs, and contribute to revenue share growth.

So why aren't companies already utilizing their Commercial Card program for all their T&E expenses?

The answer could be two–fold:

  1. Per diem and personal reimbursements may create an employee perk when employees do not spend their entire per diem or when they use personal cards to gain rewards.
  2. It is believed that employees will be more thoughtful with their expenses given the personal financial connection to their spending.

Relying on the employee perk and employeedirected spending control for T&E expense program rationale could be a missed opportunity for companies and leave a greater value on the table. Employee perks may only be valid for some employees and thoughtful spending may not actually come to fruition. Additionally, the company will lose out on other valuable benefits they could be enjoying. Companies should reconsider per diem and personal reimbursement practices.

This guide is designed to help companies consider mandating Commercial Card use for all of their business's T&E expenses to quickly deliver the following holistic benefits:

  • Policy adherence
  • Employee satisfaction
  • Strong supplier negotiations
  • Revenue share growth

Let's explore the importance of these benefits one at a time and how a Commercial Card makes a positive difference over per diem and personal reimbursement practices.

Policy Adherence

Adherence to expense policies is critical for a company to maintain control of employee spending.

Commercial Card programs allow program administrators to set controls over cardholder use. This helps employees steer clear of policy missteps by avoiding some inadvertent misuses thanks to the company proactively enabling the card with spending safeguards.

Settings can be applied to groups or to individuals. Program administrators can adjust settings at any time.

  • Credit Limits: Maintains a specified monthly budget.
  • Single Transaction Limits: Sets a maximum dollar amount per purchase.
  • Merchant Restrictions: Restricts individual merchant categories and groups.

A firm window of time can be established for an employee to complete their expense reporting. Automated push notifications remind employees and approvers of deadlines. If an employee is delinquent, the program administrator can suspend the card until the employee becomes compliant with policy.

Fortunately, a Commercial Card program can help make the reporting process easier for employees. All card transactions are easily available to review.

So unlike personal reimbursements, employees do not miss expenses should they forget or lose a receipt. Transactions are available in reconciliation software, like Visa® IntelliLink, to easily populate into an expense report.

The rich transaction data provided by a Commercial Card program enables a business to more accurately track employee spending behavior and make the necessary adjustments to bring behavior in line with corporate control and compliance policy when needed.

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Employee Satisfaction

Mandating organizationwide Commercial Card usage can help with employee satisfaction by reducing personal financial hardships and streamlining processes for employees.

Requirements for managing expenses on the company's behalf should be easy for all employees. The business reality is that employee situations vary in their ability to personally cover expenses. This could pose a significant burden for companies in managing employee needs.

Employee Challenges:

  • Personal credit card may not be available
  • Out–of–pocket cash could be limited or hard to access
  • Credit card limits can get strained
  • Reimbursement may not match billing cycle
  • Credit score could be impacted
  • Expense management process

Not all employees will have access to their own credit line, nor may that credit line be large enough to handle expenses. Having access to company credit removes the need for personal credit lines.

Within a personal reimbursement structure, employees may not be able to float the company should card payment not align with reimbursement. Finance fees, late fees or even debt–to–income ratios could negatively impact an employee. The Commercial Card alleviates these issues for the employee. With card debt and card payment being the company's responsibility, however, controllers can rest easy knowing they are protected by spend controls and the Visa Liability Waiver2, which covers employee misuse up to $100,000 per employee.

Separating business from personal expenses in order to manage both company expense reporting and home finances is a layer of complexity that is removed with the use of a Commercial Card.

Online processing helps employees complete expense reports in a timely manner. Program administrators can automate cardholder and approving manager reminders throughout the month, encouraging users to complete their work throughout the month instead of waiting until the last minute.

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Stronger Supplier Negotiations

Businesses that consistently put all T&E spending on Commercial Cards see expenses more clearly. Software, like Visa® IntelliLink, enables the ability for a program administrator to view transactions and generate reports based on supplier spend.

This insight is highly valuable, as it enables businesses to effectively negotiate supplier costs and identify preferred supplier opportunities.

Organizations that utilize travel spend data in their negotiations report a 27% greater discount for air fares, lodging and auto rentals than organizations that do not use travel spend data as part of their negotiation.3

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Revenue Share Growth

Commercial Card programs offer clients the potential to share in revenue. It's a pretty simple story. A mandated Commercial Card program will increase a company's spend and revenue share earning potential by reallocating per diem and personal reimbursement expenses to the Commercial Card.

Mandating a Commercial Card program for all T&E expenses instead of managing T&E through per diem and personal reimbursement programs is a skillful decision that can help improve a company's bottom line through control and cost reduction, while maintaining employee and company satisfaction with T&E expense management.

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**Important Details**
Business Credit Card Agreement and Disclosure Statement

1: Credit Cards: Credit cards subject to credit approval. Certain terms, conditions, and restrictions apply. See Vectra Bank Business Credit Card Agreement and Disclosure Statement for more details. All offers subject to change at any time.

2: Visa® Liability: Visa® Liability Waiver is offered by Visa, Inc.

3: Discount for Air Fares Statement: 2016 Corporate Travel Card Benchmark Survey, PRMG Research Corporation