Which Type of Corporate Card Should You Choose?

Types of Corporate Cards

Businesses and entrepreneurs can go for different types of corporate cards. Generally, the choice comes down to:

Each type of credit card suits specific business needs and comes with its own set of pros and cons. Which one do you think is right for your organization?

Let’s find out.

1. Small Business Credit Card

Small business credit cards are suitable for organizations with more than one employee. However, entrepreneurs will have to provide a personal guarantee, just like individual credit cards. Thankfully, you don’t need to pay any interest unless you carry a balance.

In addition, you can get perks like spending rewards and waivers on annual fees for more convenience.

Businesses can monitor and control expenses for employees using this type of credit card. You may also log into your online account to track spending. Best of all, entrepreneurs can implement spending limits and various policies to stay within budget.

Small business credit cards place the liability on the business owner to repay any debt. Your employees do not have to shoulder the credit responsibilities.

2. Corporate Credit Card

Enterprises can find corporate credit cards an excellent option to manage expenses. You get robust monitoring options and do not have to provide a personal guarantee. Your business will be responsible for repaying the debt, making the business owner free of any liabilities.

However, banks require enterprises to have fixed annual revenue or spending for a corporate employee credit card. For example, Capital One provides the corporate One Card to businesses ready to spend over $1 million in a year.

Investopedia recommends corporate credit cards for businesses with annual revenue of $4 million. Additionally, they are a good choice if you have more than 15 card users.

Most corporate credit cards need you to repay the debt monthly. As a result, you do not have to worry about any interest rates.

In addition, you can track your expenses in real-time from your account.

3. Prepaid Business Card

Prepaid business cards are great if you do not want to incur a debt. They are like debit cards and have prepaid balances your employees can cash on. Entrepreneurs need to top up the cards for employees to be able to spend. You can also enjoy perks like daily spending limits to have greater control over your expenses.

Prepaid cards are suitable for businesses that don’t qualify for other types of employee credit cards. However, you may have to pay a monthly fee for each card that your employees use.

The best thing about prepaid cards is that you aren’t borrowing any money. As a result, you don’t have to pay any interest on your spending. You can also load up your card with specific amounts to never over exceed your budget.

4. Virtual Credit Card

Virtual cards are a new way to manage your business expenses. You can get a virtual card for your staff in minutes without worrying over annual revenues or yearly spending. Best of all, you can take advantage of a range of customization features for granular control over expenses, like:

  • Setting budgets for each employee debit card
  • Choosing custom expiry dates
  • Setting tailored spending limits

Businesses can also control spending by configuring card behavior like one-time usage. You can also track each transaction in real-time for complete visibility into your spending. Therefore, you can easily spot suspicious transactions and take timely action to eliminate any fraud.

Moreover, you can issue unlimited cards without any fee.

Final Thoughts

Let your circumstances and needs drive your choice of employee credit card. You can go for small business credit cards if you have fewer employees and a humble turnover. Enterprises can choose corporate credit cards for easy tracking and robust control over expenditure. Entrepreneurs can also try virtual cards to reduce risks and better visibility into spending.

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