How to choose the right corporate card program for your business

As companies grow, managing employee expenses with personal cards or clunky reimbursement systems can become inefficient and chaotic. Corporate cards can streamline this process, offering better control, real-time tracking, and simplified expense management.

With the right corporate card program, finance teams can reduce headaches, eliminate paperwork, and track spending seamlessly. In this guide, we discuss what a corporate card program is and share some of the important factors to consider when choosing one for your company.

What is a corporate card program?

A corporate card program is a financial solution that allows businesses to issue cards to employees for company-related expenses. Unlike personal credit cards or small business credit cards, corporate cards cater to larger organizations that need to manage employee spending at scale. These programs provide centralized control, real-time tracking, and automated expense management.

With a corporate card program, cardholders can make business purchases without using personal funds or waiting for reimbursements. Finance teams can set spending limits, monitor transactions, and integrate the program with accounting tools for seamless reporting and reconciliation.

Corporate card programs, offered by specialized corporate card providers, can streamline company spending, reduce administrative work, and improve financial oversight. They can be a great option for businesses with multiple employees who regularly incur business expenses.

Types of corporate cards

Corporate card programs offer different types of cards to meet various business needs. Understanding these options can help you choose the right fit for your company. Here are four common types of corporate cards:

Standard corporate cards

Standard corporate cards typically work well for everyday business expenses like travel, meals, and office supplies. Businesses issue these cards to employees, set spending limits, and monitor transactions. They provide basic controls and reporting features, making them a practical choice for general expense management. Though, unlike corporate credit cards, standard corporate cards require full payment of the balance each month, meaning you can’t roll over balances. Many corporate card providers offer these as a starting point for managing company spending.

Corporate credit cards

Corporate credit cards offer a revolving line of credit, giving businesses flexibility to manage cash flow. These cards often come with robust tracking, reporting tools, and rewards programs like rebates or cash back, based on annual revenue and spending volume. Unlike standard or prepaid cards, corporate credit cards allow businesses to carry a balance month-to-month, which can help with larger or unexpected business expenses.

Virtual cards

Virtual cards are digital-only cards that businesses issue for online or one-time transactions. They offer enhanced security as each card has a unique number and expiration date. Finance teams can easily set spending limits and expiration dates for each virtual card. These cards can reduce fraud risk and simplify tracking business expenses for remote employees or contractors.

Prepaid cards

Prepaid corporate cards work like debit cards. Businesses load funds onto the card in advance, and cardholders can only spend the available balance. These cards can be perfect for managing fixed budgets or limiting spending for specific projects or events. Prepaid cards can give finance teams tight control over expenditures while avoiding the risk of overspending.

5 benefits of corporate card programs

A well-chosen corporate card program can deliver powerful advantages for businesses. Here are five key corporate card benefits:

1. Streamlined expense tracking

Corporate cards provide real-time tracking of employee spending. Instead of collecting paper receipts, finance teams can see transactions immediately. Many corporate credit card programs integrate with expense management software, automating expense reporting and reconciliation. This eliminates manual data entry and can reduce errors and save hours of administrative work.

2. Improved cash flow management

Corporate cards offer businesses greater flexibility in managing cash flow. With options to pay off balances over time, companies can handle large or unexpected business expenses without straining cash reserves. Additionally, some cards offer rebates and cash back.

3. Enhanced employee convenience

Employees no longer need to pay out of pocket and wait for reimbursements. With a corporate card, cardholders can make purchases directly. This can improve morale, especially for employees who frequently travel or incur business-related costs.

4. Rewards and cash back benefits

Many corporate cards offer rewards programs tailored to business needs. Companies can earn cash back, travel points, or rebates based on annual revenue and spending volume. They can use these rewards to offset costs, fund future expenses, or reinvest into the business.

5. Simplified compliance and reporting

Corporate cards help enforce spending policies by allowing finance teams to set limits and categorize expenses. Detailed transaction reports and audit trails simplify compliance and tax reporting. These features help businesses stay organized and meet regulatory requirements without extra effort.

Why does your business need a corporate card program?

Managing business expenses with employees' personal cards or outdated reimbursement systems can lead to chaos, inefficiency, and financial blind spots. A corporate card program offers a streamlined way to track spending, enforce spending policies, and give employees the tools they need to handle expenses easily. Here’s how a corporate card program can help your business stay in control and operate smoothly:

Improved expense management

Corporate cards provide structured, real-time expense tracking. Instead of chasing employees for receipts or reconciling unclear transactions, finance teams can monitor purchases instantly. Automated expense reporting tools can simplify approvals and reduce errors, ensuring your company can account for every business expense accurately.

Example: Your sales team attends a week-long conference. With corporate cards, each team member can charge their travel, meals, and lodging directly to the company. Finance managers can view all expenses in real-time and approve them with one click, eliminating the need for paper receipts or reimbursements.

Centralized control over company spending

With corporate cards, your business can set clear spending limits and policies based on job roles, departments, or expense categories. Managers can instantly review and approve transactions, ensuring employees stick to budgets. This centralized control can reduce unauthorized spending and help your business stay on track financially.

Example: Your company issues a corporate card to its IT manager with a $2,000 monthly limit for purchasing software and hardware. The system flags any transaction that exceeds the limit, which helps prevent overspending.

Real-time insights into financial data

Corporate cards integrate with modern expense management tools, offering real-time visibility into company spending. Instead of waiting weeks for expense reports, finance teams can see where money is going immediately. These insights can help you identify spending patterns, control costs, and make data-driven financial decisions.

Example: Your finance team notices a spike in travel expenses during the last quarter through real-time reports. They identify that some employees are booking last-minute flights and introduce a policy for advance booking to cut costs.

How do corporate cards work?

Corporate card programs can simplify the way businesses manage employee expenses. Here’s a detailed breakdown of how these programs generally function and the value they offer at each step:

Step 1: Choose a corporate credit card issuer

Businesses begin by selecting a corporate credit card issuer that matches their financial goals and needs. Leading corporate card providers offer features like customizable spending controls, rewards, and integrations with financial tools. Finance teams assign cards to employees based on their roles and spending requirements. For example, a sales manager who travels frequently may need a higher travel allowance compared to a back-office staff member.

Step 2: Set spending limits and policies

Finance managers establish spending limits, categories, and restrictions for each cardholder. They can tailor these limits by role, department, or even specific projects. For instance, an IT manager’s card may allow software purchases but block personal electronics. Advanced corporate credit card programs also offer real-time policy enforcement to prevent out-of-policy spending before it happens.

Step 3: Track expenses in real time

Corporate cards can integrate with expense management tools to log transactions as they happen. Finance teams can instantly track purchases and eliminate the need for manual receipt collection. For example, when an employee books a flight, the expense appears immediately in the company’s expense dashboard under the “Travel” category.

Step 4: Automate expense reporting and reconciliation

Linked expense management software automates the entire expense reporting process. The system categorizes transactions, flags policy violations, and generates reports for approval. Employees no longer need to submit receipts manually. Finance teams can approve and reconcile expenses in minutes, reducing errors and saving time.

Step 5: Ensure security and fraud protection

Corporate card programs include robust security features to protect against fraud. Businesses can issue virtual cards for one-time purchases, set spending caps, and receive alerts for unusual activity. If a suspicious transaction occurs, finance teams can immediately lock or cancel the card. For example, if a transaction occurs at an unapproved vendor, the system blocks the charge and sends an instant notification to the finance manager.

Step 6: Integrate with business systems

Standout corporate card programs seamlessly integrate with payroll, accounting, and HR systems. This facilitates accurate financial records and automatic reimbursements when necessary. For instance, if an employee uses their card for an approved expense, the system can sync with payroll to reflect the reimbursement in their next paycheck. This reduces manual work and maintains consistent financial data across platforms.

5 aspects to consider when looking for a corporate card program

Choosing the right corporate credit card program for your business is essential for efficient expense management. Here are five key factors to evaluate, along with practical examples to guide your decision:

1. Compatibility with expense management tools

Ensure the corporate credit card program integrates with your existing expense management and accounting systems. Seamless integration can automate transaction tracking, expense reporting, and reconciliation, saving your finance team significant time and reducing errors. When cards sync effortlessly with your tools, you can maintain accurate and up-to-date financial records without manual data entry.

2. Fees and interest rates

Carefully review the fee structure and interest rates of the corporate credit card program you're considering. These fees can include annual fees, foreign transaction fees, and late payment penalties, which can quickly add up. Additionally, some card networks charge higher interchange fees, which are the fees merchants pay for card transactions. Cards with higher interchange fees, like certain premium or rewards cards, may lead some vendors to refuse them due to the added cost of accepting those payments. This can create inconvenience and limit your flexibility when making purchases.

It's also important to check if the card program offers a grace period for interest-free payments and to evaluate whether the benefits justify the costs. A cost-effective card program should balance useful features with reasonable fees to avoid straining your budget and ensure broad vendor acceptance.

3. Spending limits and controls

Look for a program that offers customizable spending controls. The ability to set limits by role, department, or expense category can help enforce company policies and prevent overspending. Tech-enabled corporate cards often come with built-in expense policy enforcement, automatically blocking out-of-policy purchases in real time. This feature minimizes the risk of unauthorized spending and helps employees stay compliant with company guidelines. 

Real-time controls give finance teams the power to manage spending proactively and maintain tighter financial oversight.

4. Reporting and analytics

Robust reporting and analytics features are key to maintaining financial oversight. A good corporate card program should offer detailed reports and real-time dashboards that provide insights into spending patterns. These features can help you track expenses, identify trends, and make data-driven decisions to optimize budgets. Customizable reports and automated summaries can streamline financial reviews and compliance reporting.

5. Customer support

Strong customer support is important when it comes to handling issues like lost cards, suspicious transactions, or integration challenges. Look for a provider that offers 24/7 support and fast response times. Reliable customer service ensures that you can quickly resolve any problems, minimizing disruption to your business operations. Additionally, having access to a dedicated account manager can improve the overall experience and provide tailored assistance.

5 things to avoid when choosing a corporate card program

Choosing the wrong corporate card program can lead to inefficiencies, financial risks, and employee frustration. Here are five pitfalls to avoid when selecting a corporate card program for your business:

1. Lack of spending controls

Avoid corporate credit card programs that don’t offer robust spending controls. Without customizable limits and real-time policy enforcement, employees may overspend or make unauthorized purchases. This lack of oversight can result in budget overruns, compliance issues, and time-consuming audits to correct spending errors.

2. Limited software integrations

A corporate card program that doesn’t integrate with your expense management, accounting, or HR tools can create unnecessary manual work. Limited integrations mean finance teams may spend more time on data entry and reconciliation, which can also increase the risk of errors. This inefficiency can slow down month-end reporting and hinder your ability to get a clear, up-to-date view of company finances.

3. Confusing points systems

Complicated or unclear rewards programs can reduce the value of your corporate credit cards. Some programs offer points that are difficult to redeem or don’t provide tangible benefits like cash back or rebates. Confusing rewards structures can frustrate employees, and unredeemed points may ultimately go to waste, offering no return on the company’s spending.

4. Floating credit limits

Floating credit limits, where limits change according to spending patterns, can create uncertainty and disrupt financial planning. If you can’t rely on consistent credit availability, it may lead to declined transactions or unexpected spending restrictions. These unpredictable limits can delay critical purchases and disrupt time-sensitive business operations.

5. Long dispute resolution times and poor customer support

Delays in resolving disputes or addressing issues can disrupt business operations. Programs with slow customer support can leave you waiting days or weeks to resolve fraudulent transactions, lost cards, or billing errors. These delays can tie up funds, create stress for employees, and damage relationships with suppliers or service providers.

Rippling: The all-in-one corporate card and expense management solution

Rippling’s corporate card solution tightly integrates with your workforce management processes, automating tedious tasks. For instance, you can automatically issue cards during onboarding and revoke them during offboarding. Rippling unifies employee and spend data, enabling hyper-custom card policies to control how, when, and where employees can spend.

Rippling’s advanced policy engine lets you block out-of-policy expenses based on vendor, dollar amount, and expense category. With Rippling corporate cards, you also get 1.75% cash back on all purchases, in addition to rewards for every dollar spent, with no cap and no expiration! Plus, through Rippling’s Spend suite, you gain comprehensive, automated expense management and unprecedented control over spend. 

Rippling’s unified all-in-one HR platform supports global payroll and expense management, making it ideal for businesses looking to scale worldwide. Issue, manage, and revoke corporate cards seamlessly while enforcing spend policies automatically.

Corporate card program FAQs

Does a corporate card affect employees’ credit scores?

Corporate cards usually don't affect employees’ personal credit scores. The company, not the employee, takes responsibility for payments, and issuers typically evaluate the company’s creditworthiness, not the individual’s. Unlike business credit cards, corporate cards rarely require a personal guarantee or a personal credit check. However, if the issuer requires a personal guarantee, defaults could impact the guarantor's credit score.

Is it hard to get a corporate credit card?

Getting a corporate credit card can be straightforward if your business meets the issuer's requirements. These typically include having a solid financial history, stable cash flow, and clear business documentation. The approval process may involve an assessment of your company’s creditworthiness, rather than individual credit checks.

What is the difference between corporate and business credit cards?

Corporate credit cards cater to larger organizations that need to manage employee spending at scale. They usually offer advanced features like detailed reporting, customizable controls, and automated integrations with accounting tools. Business credit cards typically cater to smaller businesses or sole proprietors and may not offer the same level of control and scalability. With corporate cards, the company takes responsibility for payments, while business credit cards often require a personal guarantee.

What features do the best corporate card programs have?

The best corporate card programs offer seamless integration with expense management tools, customizable spending controls, real-time tracking, automated reporting, and robust security features. They may also provide rewards, such as cash back or points, and support global operations. Advanced programs, like Rippling's corporate card solution, streamline processes by automating card issuance during onboarding and revocation during offboarding, helping reduce administrative work.

This blog is based on information available to Rippling as of December 20, 2024.

Disclaimer: Rippling and its affiliates do not provide tax, accounting, or legal advice. This material has been prepared for informational purposes only, and is not intended to provide or be relied on for tax, accounting, or legal advice. You should consult your own tax, accounting, and legal advisors before engaging in any related activities or transactions.