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Corporate Cards are best friends of SMEs & Startups

A corporate credit card by definition is a credit card issued to an organisation, to take care of their business-related expenses, such as supplier payments, travel booking, meals, rental cars - all of these, without using their personal credit cards or their own funds.

Traditionally, SMEs and startups were the most underserved among the enterprise ecosystem wrt getting corporate cards. The silver lining is that a few fintech companies like ours, are launching innovative products specially designed for SMEs and Startups.

Following are some key benefits that SMEs and Startups are deriving from Corporate Cards:

Creating a favourable working capital environment

Corporate Credit Cards are a great tool for SMEs and Startups to enhance their working capital requirements. Having the flexibility to pay to the bank at a later date can not only expedite the payment of suppliers but also help in getting early payment discounts; and any money saved is money earned. For SMEs and startups, who are traditionally very tight with their working capital, any extension in their DPO (Days Payable Outstanding) is always welcome

Ease in Expense Managing and Monitoring

Corporate cards make it easier for employers to manage their business expenses.

Earlier, employees used to pay for all their business related expenses out of their own pockets or by using their personal credit cards, and then reimburse the same. The entire process was very lengthy, manual, error prone and time consuming, involved managing multiple receipts, paperwork and issues in reconciliation. This also hampered the employee's productivity.

With Corporate card designed especially for SMEs and startups; all of such expenses are now managed very easily by the corporates. Using the card to make payment for the said expenses, with the monthly statements helping in easy reconciliation and tracking of all expenses, it is a win win situation for the employees as well as the SME/Startup

Complete Control and Setting Limits

The centralised finance team /person of the Startup and SME would not want to share financial or bank account details to the employees for different business payments. Instead, now they can issue corporate cards with pre-set overall and per transaction limits. These limits can also define where a card can be used, limiting daily/weekly/monthly purchases to specific merchants among others. Such a mechanism, not only helps in keeping a control on the entire financial situation but also reduces any risk of fraud and mishandling of funds.

Dashboard Reports and Complete Visibility

Corporate Credit Card also provide a dashboard report with various filters to help organisations get complete visibility all their financial transactions. Various filters help in generating customized reports (vendor based, spend vertical based, location based etc) which provide the much needed centralized and streamlined process of cash management and credit allocation for future financial planning. It also frees the finance team of manually generating all such reports.

Easy Payment Option for other Business Expenses

Select Corporate Cards like ours, can be used by SMEs and Startups to pay for their business expenses including fuel expenses, utility bills like rent, electricity, GST tax, digital marketing expenses, cloud storage bills among others.

Corporate Credit Card, if used correctly, can be an important tool especially for SMEs and Startups. While convenience and security are major points of consideration for any set-up, it is the fact that these help small organisations in their working capital requirement that makes it most beneficial for them. With renewed interest in this financial instrument, it will be interesting to see what the future holds for everyone in the ecosystem.

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