Credit card programs are essential to sound Travel and Expense (T&E) management. The first step to improving almost anything is gaining control. Credit card programs gain control of T&E spending allowing you to assess current spending patterns and identify opportunities for improvement. Learning spending habits leads to informed decisions. Credit card programs offer different options and features. Use what you learn about spending habits to select card programs best suited for your organization.
Here are the main benefits credit card programs offer:
Visibility
You see where and how company funds are spent. Transactions are marked for the various credit card programs. You can build reports for individual credit card programs. You can perform company-wide consolidations across multiple credit card programs. Using a Travel Management Company (TMC) and an Expense Management software in conjunction with your credit card programs increases visibility exponentially. TMC’s record details not found in credit card transaction feeds. Expense Management software programs possess robust reporting tools. Reporting tools that allow you to combine data from the TMC, credit card feeds and expense management program. The result? You can slice and dice data to find the answers you need to make the right decisions.
Automation
Automated transactions feeds reduce processing times. Receipts are included with transactions. Eliminate paper chases. Using a Travel Management Company and an Expense Management software in conjunction with your credit card program(s) increases automation exponentially (yes – I realize I also said that about visibility). Expense reports build themselves. Would rather have your sales force selling or spending time filling out expense reports?
Control
Credit card programs let you decide where and what employees charge as expenses. Allowing employees to use personal cards makes it easier to blur business and personal expenses. Credit card programs use commodity codes to block or limit spending to defined categories. Using multiple credit card programs allows you to group spending sharing similar characteristics. Group travel spending - sometimes into sub categories like Airfare or Hotel.
Purchasing cards for supplies and operations related spending. Narrowly focused credit card programs are easier to monitor and control.
Fraud Reduction
You decide what constitutes allowable spend. You can implement card programs that only allow the purchase of specific services or commodities. No $300 charge for a night on the town if that card is only good for airfare or hotel stays. Reiterating a control feature, you can block purchase categories using commodity codes.
Industry oversight found that 37% of business travelers had at least one exception on their expense reports. Oversight estimates have the typical company losing at least 5% of its annual revenue to fraud.
Discounts and Rebates
Funneling spending through defined credit card programs leads to volume discounts and cash rebates. You can direct spending through multiple programs to maximize savings. Use card programs tailored to maximize travel related benefits, discounts and rebates. Split off operations expenses by using a purchasing or P-Card program.
Closing Summary
If credit card programs are such a good idea, why are some companies not using them?
Often it is a lack of internal resources to select and administer appropriate programs. T&E spend averages 10% of company budgets. Despite that, few companies hire professionals dedicated to controlling and administering T&E spend as their primary role. It becomes part of somebody’s job. Somebody who often lacks a T&E background. They forego fully implementing customized programs. They limp along using outdated, legacy programs.
Investing in internal or outsourced credit card administration can pay for itself and then some.
Here are the main benefits credit card programs offer:
Visibility
You see where and how company funds are spent. Transactions are marked for the various credit card programs. You can build reports for individual credit card programs. You can perform company-wide consolidations across multiple credit card programs. Using a Travel Management Company (TMC) and an Expense Management software in conjunction with your credit card programs increases visibility exponentially. TMC’s record details not found in credit card transaction feeds. Expense Management software programs possess robust reporting tools. Reporting tools that allow you to combine data from the TMC, credit card feeds and expense management program. The result? You can slice and dice data to find the answers you need to make the right decisions.
Automation
Automated transactions feeds reduce processing times. Receipts are included with transactions. Eliminate paper chases. Using a Travel Management Company and an Expense Management software in conjunction with your credit card program(s) increases automation exponentially (yes – I realize I also said that about visibility). Expense reports build themselves. Would rather have your sales force selling or spending time filling out expense reports?
Control
Credit card programs let you decide where and what employees charge as expenses. Allowing employees to use personal cards makes it easier to blur business and personal expenses. Credit card programs use commodity codes to block or limit spending to defined categories. Using multiple credit card programs allows you to group spending sharing similar characteristics. Group travel spending - sometimes into sub categories like Airfare or Hotel.
Purchasing cards for supplies and operations related spending. Narrowly focused credit card programs are easier to monitor and control.
Fraud Reduction
You decide what constitutes allowable spend. You can implement card programs that only allow the purchase of specific services or commodities. No $300 charge for a night on the town if that card is only good for airfare or hotel stays. Reiterating a control feature, you can block purchase categories using commodity codes.
Industry oversight found that 37% of business travelers had at least one exception on their expense reports. Oversight estimates have the typical company losing at least 5% of its annual revenue to fraud.
Discounts and Rebates
Funneling spending through defined credit card programs leads to volume discounts and cash rebates. You can direct spending through multiple programs to maximize savings. Use card programs tailored to maximize travel related benefits, discounts and rebates. Split off operations expenses by using a purchasing or P-Card program.
Closing Summary
If credit card programs are such a good idea, why are some companies not using them?
Often it is a lack of internal resources to select and administer appropriate programs. T&E spend averages 10% of company budgets. Despite that, few companies hire professionals dedicated to controlling and administering T&E spend as their primary role. It becomes part of somebody’s job. Somebody who often lacks a T&E background. They forego fully implementing customized programs. They limp along using outdated, legacy programs.
Investing in internal or outsourced credit card administration can pay for itself and then some.
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