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All Things Corporate Credit Cards

All Things Corporate Credit Cards

Some industries, particularly consulting, have a ton of mandatory travel.  These industries have upwards of 90% travel requirement, typically needing the employee to travel four days out of the week.  When it comes to traveling for work is often exciting, but brings up questions surrounding expenses and payment for airfare and hotels.  That’s why we’re writing an article on all things corporate credit cards.

Business travel is often a requirement of senior and executive level positions.  Oftentimes, individuals in those positions will need to travel to meet with clients, customers, and other corporate offices.  Meeting with those groups is often considered a priority and companies will go to great lengths to ensure that their needs are met. 

In this article, we’re going to discuss all things corporate credit cards.  We’ll discuss what a corporate company card is, where and when you can use a corporate credit card, whether or not you can be denied for a corporate credit card, and how they get paid.  In addition, we’ll be reviewing what the most popular card is and how an individual corporation can qualify for a corporate card.  Lastly, we’ll discuss whether or not a corporate credit card affects your individual credit score.

What is a corporate credit card?

A corporate credit card is a credit card issued to employees by the company.  Sometimes the corporate credit card is issued to all employees, while at other times it is only issued to select employees. 

Corporate credit cards are inherently different than small business credit cards and personal credit cards.  A corporate credit is often backed by the corporation, essentially guaranteeing the charges will be paid in-full by the company.  This means that the cards are issued to the company, not the business owners, the president, or the CEO.

When issued to an employee, the corporate credit card may or may not have their name on the card.  If it does not, then it will typically be addressed to the corporation.

When can I use my corporate credit card?

A corporate credit card should only be used for all eligible corporate expenses, not just on business travel.  Depending on the company’s policies, these charges can include weekly lunches or dinners for staff, random coffee runs, or office parties.

You should always confirm with your manager on company policy.  Some company’s allow unlimited use of a corporate card for business related expenses without question.  Other companies are stricter, having specific use-cases when the corporate card is allowed to be used.

When you use your corporate card, you should always keep and save your receipts from every merchant you visit.  Though not mandatory for all companies, it is better to save the receipts in case it is asked for.  In addition, you should request itemized receipts where possible as to differentiate between allowable and not allowed items, particularly alcohol.

Can I be denied a corporate credit card?

Unfortunately, yes you can be denied a corporate credit card from the credit card issuer.  While embarrassing, there are recourses you can take to get approved.  Oftentimes, you may be denied a corporate credit card due to past delinquencies, fear of credit fraud, or low credit scores.

If you are denied a corporate credit card, speak to your manager and human resources on the matter.  They’ll understand your circumstance.  With their assistance, they will write a letter to the issuer of the corporate credit card, agreeing to fully back your card.  This should be sufficient, and the credit card will be issued to you.

How do corporate credit cards get paid?

Corporate credit cards are typically paid in full once the appropriate expense report has been submitted and approved.  As the process varies from company to company, it is helpful to speak with your manager or your human resources department to confirm the specifics of the process.

What are the most popular corporate credit cards?

 By-and-large, the most popular corporate credit card is provided by American Express.  American Express has invested heavily in the corporate sector and has become the gold standard for corporate credit cards across small and large organizations.  This is not a paid post and an honest opinion expressed by the author.

If you would like to read more on other corporate credit cards, feel free to hop over here.

How does a corporation qualify for a corporate credit card?

Generally, in order to qualify for a corporate credit card, the organization must be in business for a minimum of 12 months.  In addition, the business address may not be a home or P.O. box. 

With larger credit card companies, such as American Express, projected credit card usage should be above $250,000 and there must be a minimum of fifteen users on the card.  Lastly, the corporation must be registered as an S or C corporation.

Finally, sometime certain organizations may be asked to provide recent financial statements, tax information and identification, and details about the company structure of hierarchy.

What are the pros and cons of issuing corporate credit cards?

Corporate credit cards are useful for keeping track of employee expenses.  All expenses will flow through the same portal and can be easily managed, tracked, and paid in full.  In addition, these credit cards can have limits on spending capabilities and can have a list of approved or unapproved vendors and merchants.

From an employee perspective, corporate cards can provide relief in terms of financial capability.  The employee won’t have to charge their own credit cards for hotel and airfare, which they may or may not have an adequate limit for.

Corporate credit cards also offer an array of perks and rewards for both the corporation and the individual cardholder.  Everything from cash advances, to luggage replacement, to insurance coverage on rental cars.

However, corporate credit cards can be misused by an employee.  They may charge non business-related charges to their card.  In addition, as the employee is using a corporate card, they may feel more comfortable to overspend on airfare, hotel, or meals.

Lastly, the more corporate cards issued, the higher the likelihood of theft.  This could become a nightmare to manage and remove and will require multiple departments to liaise with the credit card issuer to resolve.

Can a corporate credit card affect my personal credit score?

Dependent on the liability structure, a bill that has gone unpaid for over 180 days may ding your personal credit score.  Typically, corporate credit cards won’t appear on your credit score, but a joint liability card can affect your score if unpaid over 180 days.

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