Whatever business you operate, surely there are a lot of purchases and spendings that your company needs to do. From business dinners to corporate travel, your employee will need an efficient way of paying your vendors and business partners. And this is where virtual cards come into the picture.
Instead of dispersing cash to your employees who need to settle payments with providers, it’s ideal to entrust them with multi currency business cards that are designed to process payments efficiently. This payment method allows them to officially use your company’s budget without risking a loss of cash, fraud or going over the budget.
Discover the following ways how virtual cards can help boost budget control and transparency in your company:
1. Provide Better Understanding Of Employee Budget
One of the issues for companies that involve fund management is fraud. Some dishonest employees try to pocket company money and report the wrong figures. This usually happens when the company uses a simple cash system.
Receipts can be sourced in illegal ways, providing inaccurate expenditures. Fortunately, this won’t be the case for virtual cards. Since charges will be debited from the company’s budget, the finance or accounting team will see the exact amount on the report.
Virtual cards are easy to track and monitor, so you know where and how much each employee spends. This allows the company to stay within spending limits more easily than ever. False and fraudulent reimbursements and expense refunds will be avoided, saving costs for your company.
It’s the most transparent and accurate way of entrusting company money to your employees. Virtual cards can be integrated into your accounting software, so reports can easily be generated.
2. Spending Limits Can Be Set
One common issue with using cash is the tendency to go beyond the company budget. Whether you’ll have company dinner or team building expenses, there are chances of overspending when using cash.
Virtual cards can prevent this. By allowing key people in the department to set a spending limit for each card created, virtual cards provide a smooth transaction for your employees to keep their expenses within budget. This allows your company to manage the funds for every business activity easily.
The card’s authorized manager can quickly adjust and modify budgets when an unexpected event happens. They can control how much will be allowed to be dispersed from the card. They can control how much will be allowed to be dispersed from the card.
This assures that there is ample control by the management, thus preventing fraud in the company. Managers know the company budget limits and can oversee expenditures more effectively than anyone.
3. Improve Financial Management
Some companies provide a company credit card to some employees. While this could be effective at some point, this might become complicated because one needs to be familiar with statement dates, due dates, and other information to manage the company credit card properly.
There are a lot of transactions to keep track of, and even employees can find it hard to remember when and how much was charged on the company card. This could lead to unnecessary company expenses and untraceable transactions which might no longer be business-related.
Fortunately, virtual cards can save your company from this financial mess. The finance team can create, issue, and manage cards online, simplifying the entire process.
Also, employees don’t have to carry a physical card because virtual cards can easily be issued online without the need to meet in person. You can go ahead and complete the transaction by inputting the secured details of the virtual card.
The ultimate benefit of using corporate virtual cards is better financial management for the company. This can avoid wasting time and energy in analysing receipts and creating reports.
Real-time reporting and accounting are made easy. The finance team can easily determine how much funds are still available, what funds have been allocated, and how much has been spent.
4. No Hidden Charges
Another advantage of virtual cards is that they don’t come with hidden charges, unlike other business financial tools. Virtual cards have fewer fees compared to corporate credit cards. And what’s even great is that you’ll earn cashback and rebates for your online transactions.
Institutions that issue virtual cards have fewer operating costs allowing them to add perks such as cashback when using their cards. This encourages more card usage and excellent customer experience.
Here are some tips for businesses in 2022, and switching to digital payment methods is one of them. Since digital transformation is a rising trend, virtual banks and services are sprouting here and there.
As mentioned in this article, you can take advantage of the benefits of using corporate virtual cards. The key is to go for a multi-currency corporate card that works seamlessly across borders worldwide and allows you to earn cashback.