Business Or Corporate Card: What Suits Your Business Best?

Corporate Card
Corporate Card

Last Updated on April 15, 2024 by harnold david

Do you need help choosing the best card for your business? Rest assured, you have come to the right place. A business card is usually opted for by small businesses, entrepreneurs, and start-ups that need quick access to short-term capital or rewards when making purchases concerning your business. These cards bear the name of the owner or treasurer of the business and require no personal guarantee. 

On the other hand, corporate credit or debit cards are more suited to larger corporations and organizations to have control over their company spending on travel, supplies, or other work-related expenses. 

Both cards have their advantages and disadvantages, depending on what your business needs. Let’s explore some more of these differences to help you choose the best fit for your company. Continue reading to find out more.

What are Corporate Cards?

While they may seem quite similar to traditional business cards, a corporate card comes with their own set of additional benefits:

  • Increased spending limits
  • Access to better rewards and programs
  • Improved data analytics and reporting capabilities

Corporate cards do tend to have a higher annual fee as compared to our traditional business cards, but with their competitive interest rates, it is almost worth it. If your business needs access to additional funds on a regular basis for daily operations or wishes to take advantage of promotional offers or discounts when you make large expenditures, look no further than corporate cards to benefit wholly from them. 

What are Business Cards?

Business cards are offered to businesses to finance their daily operations and activities. Make purchases, pay bills, accumulate points, and earn exciting rewards when you use a business card. These cards are typically provided by banks or financial organizations that offer features such as promotional offers, reward programs, and flexible spending limits. As these cards are usually issued to an individual rather than a corporation, business cards are subject to annual interest rates based on your credit score. 

Advantages of Corporate Cards –

  1. Higher Spending Limits: A primary advantage of using a corporate credit card is the spending limit. Make large purchases without worrying about exceeding any budget limits or dealing with any cash flow issues. 
  2. Cashflow Management: Corporate cards are the most efficient way to track cash flows. By issuing employee cards, you can monitor spending habits across all departments, track expenditure data and reports, and ensure company policies are being adhered to. With so much visibility, you can rest easy knowing where and how your employees spend business funds, allowing you to make better business decisions. 
  3. Reward programs: Keep morale high with exciting promotions and exclusive reward programs every time your employees make purchases. Earn and redeem points towards merchandise or services according to how much you spend in a month. 

Advantages of Business Cards –

  1. Promotional Offers: Would this really be a credit card without any of its normal benefits and advantages? Enjoy cashback rewards, high-value discounts, and other appealing deals, which help you save money every time you spend money. Some cards offer rewards for even general purchases such as gas, business dinners, or office supplies.
  2. Flexible Spend Limits: As your company expands and grows, so does your business credit card. Business cards mostly come with flexible limits to grow, allowing you to access additional funds if needed. 

Disadvantages of Corporate Cards –

  1. Higher risk or misuse or abuse: Suppose you grow lax with your monitoring or your finance guy quits on you. Without proper oversight, you can easily miss out on how much your team spends or where and whether they are all legitimate business purchases. Make sure you have set strict spending limits while restricting specific locations as well. 

Disadvantages of Business Cards –

  1. Increased chances of overspending: A common mistake that can lead to a major disadvantage is the mismanagement of business funds. Without a proper set of strict rules and guidelines, there is the possibility of overspending and impulse purchases. Be sure to avoid such unnecessary charges or mistakes.
  2. Security: With the constant threat of scams and fraud, it is crucial to issue credit cards that provide assurance with top-notch and advanced security features. However, most business credit cards seem to be lacking in the security department. Without the integration of new, cutting-edge technology, these cards can leave you vulnerable to unauthorized charges. 

To Conclude:

Understanding the benefits, limitations, and terms and conditions of each card before deciding between a corporate card and a business card is an important step toward making better, streamlined financial decisions. Find what best fits your company, and sign up today!