Tag: Corporate Credit Cards

Does your company have its very own credit card? If not, how do you make and track all the expenses for your business? Well, are you aware of the fact that credit card for company have become an essential tool for businesses of all sizes?

The best corporate credit cards provide a convenient way to make purchases, manage expenses, and track spending. With the right credit card, companies can earn rewards and cash back on their purchases, which can help to reduce costs and improve the bottom line. However, managing credit card spending can be a challenge, and it requires careful planning and attention to detail.

In this blog, we will discuss the importance of managing credit card for company and its spending. We will also talk about the tips and strategies to help businesses make the most of their credit cards. We will also discuss the best practices for managing company credit card spending and how to manage credit card rewards and incentives.

Importance of managing credit card spending

Credit card for company and its spending is a critical area for businesses to manage. If not managed correctly, it can lead to overspending, cash flow problems, and even fraud. By managing credit card spending, companies can avoid these issues and ensure that their expenses are under control.

One of the most significant advantages of using a credit card for company expenses is the ability to track and categorize expenses. Many credit cards provide detailed statements that break down expenses by category, making it easy to see where the company is spending its money. This can be helpful for budgeting and planning, as well as for identifying areas where the company may be overspending.

Another advantage of managing credit card for company and its spending is the ability to take advantage of rewards and incentives. Many credit cards offer cash back, points, or miles for purchases, which can help to reduce expenses and improve the bottom line. However, to make the most of these rewards, it is essential to manage credit card spending effectively.

Apply for a business credit card with EnKash.

Best practices for managing company credit card spending

Managing credit card spending for a company can be a challenging task, but there are some best practices that businesses can follow to make the process easier and more effective.

1. Set spending limits: One of the best ways to manage credit card spending is to set spending limits for each cardholder. This can help to ensure that employees are not overspending or making unnecessary purchases. Businesses can set spending limits for each cardholder based on their role and responsibilities, and they can adjust these limits as needed
2. Monitor transactions: Monitoring credit card transactions is critical for managing expenses and identifying potential issues. Businesses should review credit card statements regularly to ensure that expenses are legitimate and to identify any unusual or unauthorized transactions. Many credit card companies offer fraud protection services that can alert businesses to suspicious activity
3. Use expense management software: Expense management software can help to streamline the process of managing credit card spending. This software can automate expense reporting and categorization, making it easier to track expenses and identify trends. Many expense management tools also integrate with credit card companies, making it easy to import transactions and monitor spending
4. Encourage responsible use: Encouraging responsible credit card use among employees is critical for managing expenses and maintaining good credit. Businesses should provide training and guidelines for credit card use, including how to make purchases, when to use the card, and how to track expenses. Employees should also be encouraged to report any issues or concerns regarding credit card spending

Managing credit card rewards and incentives

Managing credit card for company’s rewards and incentives is an essential part of managing credit card spending for a company. To make the most of these rewards, businesses should consider the following strategies:

1. Choose the right credit card: Choosing the right credit card is critical for earning rewards and incentives. Businesses should consider the types of purchases they make most frequently and select a credit card that offers rewards for these purchases. For example, if the company frequently travels, a credit card that offers rewards for airline miles may be a good choice
2. Maximize rewards: To maximize rewards, businesses should use their credit cards for as many purchases as possible, including recurring expenses like utility bills and office supplies. It is also important to pay the credit card bill on time and in full each month to avoid interest charges and late fees
3. Redeem rewards wisely: Businesses should carefully consider how to redeem their credit card rewards to get the most value. Some credit cards offer cash back, while others offer points or miles. Businesses should choose the reward that provides the most value and consider the redemption options available
4. Keep track of rewards: Keeping track of credit card rewards is critical for managing expenses and maximizing rewards. Businesses should track their rewards and ensure that they are being credited properly. Many credit card companies provide online tools to help businesses manage their rewards

Conclusion

Credit card for company is an essential tool for managing expenses and improving the bottom line for businesses. However, managing credit card spending can be a challenge. By following the best practices for managing company credit card spending and taking advantage of credit card rewards and incentives, businesses can ensure that they are making the most of their credit cards.

Apply for a business credit card today with EnKash, the spend management platform that deserves for your business. You can also enjoy the perks that you and your business deserve!

Choosing one of the best corporate credit cards and applying for a business credit card with suitable rewards and incentives can significantly impact the financial health of a company. You can do that with EnKash, your very own fintech solution provider. By paying attention to credit card spending and rewards, EnKash can help your business to save money and improve their overall financial health.

Business credit cards are similar to regular credit cards but are designed specifically for business owners. These business credit cards help build an organization’s credit profile which is crucial for future loan applications. The business credit card is used specifically for business-related expenses such as bank fees, company car, software, utilities, payroll, rent, and more.

Small or large scale, a business credit card is essential for all businesses. However, the business cards benefit companies, especially start-ups. Here is everything to learn about corporate cards, their features, and how they can benefit your start-up.

Understanding Business Credit Cards

Business cards offer higher spending limits and different rewards depending on the card lender. Some of the business credits are enabled to track the expenditure category making it easier for the companies to download the invoice and keep a tab on the expenses to pay back before the due time, maintaining the credit report. Here are the businesses that qualify for best business credit cards-

1. Freelancers
2. Sole proprietors
3. Large business owners
4. Start-ups
5. Corporations, and
6. Limited liability companies

Business credit cards allow you to make purchases on credit and pay for them later. The business cards come with a credit limit, the maximum amount you can charge to the card. You can use a business credit card to make purchases online, over the phone, or in person.

Using the best business credit cards can also help you establish a good credit history for your business, which can be useful when you need to borrow money or apply for a business loan. Many business credit cards also offer rewards programs that allow you to earn points or cash back on your business purchases. These rewards can offset business expenses or provide other benefits to your business.

Importance of Best Business Credit Cards for Startups or Small Business

Small businesses or start-ups are burdened with many responsibilities to be profitable. There are sometimes zero profits as the maximum cut goes into the payroll. A business credit card can be a boon for these organizations if used smartly.

Small businesses and start-ups often receive emails to apply for the best small business credit card with added benefits. With the help of this card, they can manage various daily expenses and still enjoy the added rewards. Here are the key benefits of having the best small business credit card-

• Managing employee expenses with ease

Often employees pay from their personal cards and apply for reimbursement by submitting the original bill. In case the bill is missing, justifying the reimbursement during the audits can create trouble for the company. However, with the help of the best small business credit cards, the employees can easily pay for expenses with the card, and the finance department will then have to generate bills from one source each month.

Having the best business credit cards will help business owners track how much their employees spend or whether any unusual transactions need special attention.

• Simplifying and streamlining the cash flow

You can purchase anything from equipment to office supplies with the best business credit card. However, multiple paying sources are difficult to track. Come tax season, the finance team will need help to transfer multiple data to QuickBooks or Excel.

With the help of the best business credit cards, you can access all the info at one source, link it with your software, and transfer all the information automatically. This will help in saving time and maintaining records concisely.

• Separating business and personal expenditure

Using a business credit card allows you to separate your personal and business expenses, making it easier to track and manage your business expense management. It also helps to protect your credit score if your business runs into financial difficulties.

Key Features to Check While Picking a Best Business Credit Card

Picking the right business credit card is essential to avail of the benefits. Like individual credit cards, interest rates, spending limits, spending tracking features, and more should be checked. Key features that you should check while picking the best business credit card:

1. Rewards and perks

Many business credit cards offer rewards and perks such as cashback, points, and discounts on business-related expenses like travel and office supplies. Look for a card that offers rewards that align with your business needs and spending habits.

2. Interest rate

If you plan to carry a balance on your business credit card, it is important to consider the interest rate. Look for a card with a competitive interest rate or lower interest rate.

3. Credit limit

Business credit cards often have higher credit limits than personal credit cards, which can help make larger purchases or manage cash flow during slow periods. Consider your business’s needs when choosing a credit limit.

4. Annual fee

Some business credit cards charge an annual fee, which can vary widely depending on the card and its features. Consider whether the card’s benefits outweigh the annual fee and whether you will be able to offset the cost through rewards and perks.

5. Ease of use and expense tracking

Look for a business credit card that offers online tools and resources for tracking and organizing business expenses, making it easier to manage your finances and prepare for tax time.

6. Fraud protection

It is important to choose a business credit card that offers strong fraud protection to help protect your business from unauthorized charges.

7. Customer service

Look for a business credit card with good customer service in case you have any questions or issues with your card.

Apply for a Best Business Credit Card with EnKash

The spend management platform EnKash provides transaction and expenditure solutions to companies of different scales. The purpose-based cards from EnKash cover various business expenses such as travel and expense cards, purchase cards, saas cards, and more. You can also apply for virtual cards for ease of payment. Explore our platform today and apply for the best business credit card for your start-up.

A partnership between the retailers, card networks, and issuers create co-branded credit cards to help you earn extra reward points on purchases made on Amazon and similar platforms. Co-branded credit cards extend exclusive perks and benefits as well.

A mutual partnership producing a credit card carrying the merchant’s logo along with merchant-specific benefits to loyal consumers. Simply put, co-branded cards are an amalgamation of loyalty and credit cards.

Let us take a detailed look at co-branded credit card.

What Is a Co-branded Credit Card?

Co-branded credit cards are forged through a balanced partnership between a card network (i.e., EnKash) and a card issuer/bank lined with any brand or retailer. They function like loyalty cards for the audience who often shop at specific stores or travel with specific airlines. Regardless, co-branded cards can also be integrated with other organizations and charities.

Co-branded credit cards offer brand-incorporated exclusive advances to cardholders, with the brand’s name and logo imprinted on them. EnKash issues co-branded credit cards with numerous rewards and cashback opportunities. Co-branded cards are accepted by brands incorporating this service and with any vendor who accepts cards on the network. In addition, major airlines also offer co-branded credit cards in partnership with banks and card networks like EnKash.

Basics of a Co-branded Credit Card

Co-branded credit cards can be used anywhere the card’s network is welcomed. Unlike store cards, these cards work just like any other credit card. Store cards limit purchases to brand stores and their partners only, whereas co-branded cards are accepted widely. For example, purchasing a membership card seems right when you are going to Starbucks for the first time. But that card will only get you coffee-related rewards; with co-branded credit cards, that is not the case.

While being accepted widely, the benefits are tailored according to the customer’s brand loyalty. The offers and rewards received by the cardholder are limited to the respective retailer, brand, or airline. Maintaining a good credit score lets you take advantage of discounted rates and perks. Upgraded membership status, discounts and cashback are some examples of what we mean by rewards here.

Co-branded credit cards are managed by their respective banks or directly by the issuer to record and report your activity to a trusted credit bureau. Having a virtual bank account is an essential component here, so you can access your purchase history and manage other aspects of your account smoothly. Now, log in with EnKash, create a virtual bank account and begin your journey.

The retailers and the bank or issuer connect to approve new cardholders to create exclusive offerings further. Co-branded cards can be applied at a store or the service location itself. But, considering your busy schedule, getting the best co-branded credit card online with EnKash is the best option.

Things to Keep In Mind

Understanding pre-approval tools on EnKash’s website is essential, they do not affect your credit score. The pre-approval applications convey the probability of qualifying for a credit card. Moreover, you need to check if the joining and renewal fees outweigh the financial equivalents of rewards (cash backs, discounts, vouchers and so on) that you will receive further.

The most forgotten factor of these rewards is the expiration date. Make sure you redeem the accumulated reward points and vouchers before expiring.

The Growing Trend of Co-branded Cards

The generation today has gravitated towards digital payments. Co-branded credit cards have thus experienced a remarkable rise. Co-branded cards incorporate logos of the two partnering companies to offer benefits. Additionally, non-profit organizations have also started to join forces with card issuers other than banks and retailers.

Co-branded credit cards offer not one but the dual advantage of a rewards card and a store one. The working of a credit card is much similar to these hybrid co-branded credit cards. Backed by major networks like EnKash, these hybrid cards offer discounts and other rewards like points that can be used in your next purchase by the retailer or service.

Benefits and Features of Co-branded Credit Cards

If you often go back to a specific retailer for travel or shopping, a co-branded credit card has numerous benefits in store for you. First, limit the number of cards you carry in your wallet and manage your spending better with a clear purpose.

The best co-branded credit cards, like EnKash, provide useful perks to cardholders that they otherwise would not receive. In addition, they are very cost-effective and useful once you gain an understanding of how they function.

For example, cards affiliated with airlines might offer priority boarding, hotel cards offer room upgradation at times, late checkout and so on. As a result, these cards have more potential for significant discounts than getting cash back.

• Worldwide acceptance

Co-branded credit cards are international cards accepted worldwide. They can be used at any merchant outlet globally, while the bill is generated in Indian Rupee (INR). Their wide acceptance is due to their link up with EnKash.

• Rewards based on customer loyalty

It is a unique way of rewarding the customer for their loyalty. This factor deeply influences the engagement rate for both parties, making it a win for all. Opt for a card from a brand with which you will be making regular transactions. This will help you reap all the rewards to their fullest extent without worry.

• Personalized according to lifestyle requirements

Co-brand credit cards are flexibly customized to suit your spending patterns and lifestyle requirements. This is because they come attached to a specific brand. When you use co-branded cards on a scattered basis, you can stockpile the reward points earned for future advances. But this will only benefit you in the short run. However, getting two co-branded cards will eliminate overburdening and result in maximized benefits.

CardX by EnKash: Issue and Scale the Best Co-branded Credit Cards

Applying for a co-branded credit card is just like applying for a traditional one. Getting a co-branded credit card requires little effort and time. You can apply and fill out the application form online or in-store. So, even if you are on a plane, you can access and secure one of the best co-branded credit cards in the game.

Make sure you maintain a healthy credit score and check how much is recommended as per the card you choose to go for. The reason is simple—card issuers handle and oversee co-branded credit cards and perform a deep check on credit reports to ensure a smooth relationship.

EnKash Co-Branded Credit Card for All Your Need

If you spend considerable money on co-partnered brands, opting for a co-branded credit card is the best option. Picked wisely and used effectively, co-branded cards can benefit you in many ways like bringing down purchase costs significantly through their reward system, streamlining and managing your spending and more. If you are looking for state-of-art spend management platform, then connect with EnKash and explore your options today!

A business credit card is a specially designed card for business owners and provides unique benefits to a business or an organization. Business cards come with high credit limits, more significant reward potential, and different tools to help you manage expenditures and employee cards. It also provides ready financing in case of an emergency for any business.

Business credit cards work similarly to other personal cards. After each billing cycle of your card purchases, you get a statement with the total balance owed and the minimum amount due. Interest is charged if you do not pay the due amount before or on the due date. Likewise, there are diverse types of business corporate cards with similar functions. They are:

• Business credit cards for startups: Small businesses or startups can qualify for business credit cards.
• Prepaid business credit cards: Prepaid business credit cards function like regular, widely known business credit cards—they can be used to make purchases and to pay other business spends. However, before anything, you need to pour funds into your prepaid business credit card to enable its usage.
• Business credit cards for Limited Liability Companies (LLCs): Your personal and business spends have to be separate to avoid any overlap – One of the main gains of having a business credit card for LLCs is to limit the aspect of personal liability.

You need money to fund your operations in any business organization, and since business cash flow can be erratic sometimes, it is necessary to have a business credit card.

Benefits of a business credit card

Business credit cards cater to the needs of a business and have proven to be better than personal credit cards. Here are a few advantages of a business credit card that you can enjoy if you have one.

1. Higher credit limit
   Business credit cards are specially designed to meet business needs and are typically meant for a bigger line of credit than the usual consumer credit card. However, there is no set limit on the credit, and at the time of heavy payments, you can avail the benefits offered by it.
2. Track business spending
   With the help of a business credit card, you can separate your business spending from personal ones. This helps you to maintain your books and prepare your tax returns. You can also keep an eye on the over-the-top expenses you are making and can control them further.
3. Extended interest-free time limit
   With a business credit card, you can get an extended period of interest-free financing longer than the usual 21-day period of a personal credit card. Suppose any business credit card offers you such a benefit. In that case, it will give you a more extended grace period to pay the balance and the flexibility to make business investments.
4. Travel rewards
   Prepaid business credit cards offer you bigger and better rewards than other personal credit cards. And if you travel more often for your business trips, you tend to get more travel rewards and miles for yourself.
5. Employee cards
   Another great benefit that a business credit card caters to is that you can also add employees to your business credit card. This authorizes the employees to perform tasks, such as making some purchases for the business. You will be allowed to track their activity and increase rewards on employee purchases. With this, you can also set up individual credit limits for their activities.
6. Open a line of credit
   Irrespective of the size and nature of your business, cash flow is vital. With a business credit card, you can easily open a line of credit. In addition, it will help you quickly purchase the supplies, materials, pieces of equipment, etc., and lets you enjoy a relaxed period for payment.
7. Enjoy loyalty points, rewards, and cashback
   With business credit cards for startups, you can enjoy certain rewards like loyalty points, rewards, and cashback compared to a personal credit card. In addition, these cards offer more benefits and easy EMI options on high-value and bulk payments.

How does a business credit card impact your credit score?

It would be best if you had a good credit score to qualify for a business credit card. This is because the issuer will investigate your credit history and score based on whether you will be eligible. In addition, you need to make a personal guarantee to be responsible for any debt on your card. This is important if the business is in trouble or has any chances of folding up. Issuers need to know if somebody will be responsible or accountable.

If you incur business-related expenses with your business credit card, you will be rewarded with business credit. Doing this will help you tap into more significant lines of credit and other business loans to grow your business and fulfill the desired goals.

In short, a business credit card can boost your credit score. Whether you have a business running on a larger scale or a small business, it is wise to have a business credit card. You must opt for business credit cards to avail the benefits they come with and have a fuss-free business schedule. Therefore, EnKash is considered the most reliable platform for seamless corporate spend management and payments.

Get high credit for your business with specially designed business credit cards. Enjoy quick processing with collateral-free access and digital KYC to grow your business. Visit the EnKash website and explore our best and most customizable services.

Today, businesses need to work in a world where credit cards are no longer a luxury but a necessity. Whether it is making payments for sudden business expenses paying a bill to entertain a customer or even enabling your employees to pay for fuel. The scenario for online payments and the use of credit cards has become so widespread that many of us do not know how many different types of credit cards are available. It has also become difficult to select the right one for your business needs.

At EnKash, where we help customers manage their finances with our spend management and cards platform, we come across this query many times. Customers often ask us what is the best credit card option for us.  This blog will address this question and tell you about the different types of credit cards and what they can be used for. With this knowledge, you will be able to make the right decision on which credit card to opt for to meet the specific needs of your organization.

What is a credit card?

A credit card is a financial instrument, usually in a plastic card form, but can also be in virtual forms. Credit cards are issued by banks or financial institutions with a limit set on them. You can use the credit card for various transactions up to the set limit. Repayment of the credit card dues depends on the billing cycle of the credit card company. With most credit cards, you will have the option to make a minimum amount due part repayment, or complete repayment. 

In case you opt for partial or minimum amount due payment, there will be an interest charged on the remaining amount due. In instances where payment is missed, there would be a penalty for late payment as well as interest charges.

What are the different types of credit cards?

The first distinction we have to make here is between corporate credit cards and personal credit cards. Personal credit cards are issued to individuals based on their personal credit scores and credit history. Corporate credit cards are issued based on the business’s financial credibility and they are further broken down for individual usage. 

In this article, we will look primarily at the different types of corporate credit cards and not personal credit cards.

Secured credit card

In normal circumstances, credit cards are unsecured loans as they are based on your financials rather than attached to any collateral or property. But in some extreme cases, businesses without the right financial records may approach a bank or financial institution and request a credit limit on a card (for traveling or making certain payments) and offer some property as collateral. The collateral will be used to justify the credit limit and will be held against the credit limit until the arrangement is ongoing, in such cases the cards are called secured credit cards.  

Charge cards

These types of cards have one critical and fundamental difference when compared to a typical credit card. Charge cards often do not have any limit set on the amount that can be charged to the card. While this sounds like an amazing value proposition, there is one big condition to charge cards. You will be required to pay back the entire amount spent when you get billed. This means that while the charge card offers you the flexibility of a huge amount at your disposal, it also means that you need to repay at the end of the billing cycle.

Revolving Credit Cards 

This category of credit cards can be personal or corporate, based on individual finances and credit scores or that of the business. With this credit card, you get a set limit a pre-decided credit limit, and a set cash withdrawal limit. The billing cycle for most credit cards is 4-5 weeks and is set on a particular date of the month. Under this type of card, you have the option to make part payments (minimum amount due or more) to the billed amount due and pay the rest over time. You will be charged interest on the amount due until you repay the entire amount. Cash withdrawals on such cards have a nominal fee as well as interest charges. There are many reasons that businesses opt for a corporate credit card. 

There’s often a chance that the credit limit of your card will be revised upwards over time depending on your repayment history and evolving financial situation. Many financial institutions offer a corporate credit limit to businesses with the option to further allocate the funds to various teams for usage down the line. However, make sure to have a comprehensive corporate credit card policy in place before issuing cards to your extended teams. 

Specific-usage cards

This type of card is a subset of credit cards with revolving limits. Once you have a particular credit limit assigned to your business, spend management companies like EnKash offer you a free dashboard to manage the funds. For instance, you can issue fuel cards that can be used by your employees to fill fuel for their work-related vehicle usage. Or meal cards can be issued to employees as a tax-saving perk for the specific purpose of purchasing meals or food-related provisions. You also have the option to specify other expenses like rent, marketing subscriptions, travel and entertainment, utilities, GST, and other payments along with an upper spending limit.

Prepaid cards

Strictly speaking, this category of cards does not fall under credit cards as you will need to load funds onto the card before using it. And the usage will be limited to the amounts loaded on the card. However, in the universe of corporate cards, this type of card has an essential role to play as it makes the management of expenses like foreign travel, gifting for rewards & recognition, and other purposes. More often than not prepaid cards, especially gift cards cannot be used again. However, prepaid cards offer the option to transfer specific amounts with lesser risk to different business stakeholders as per the requirement.

Here’s what you need to do next:

• Talk to various departments and understand their struggles related to spend management
• Assess the investments you have already made toward managing finances within the organization
• List out the priorities when it comes to the management of expenses and payables along with the roadblocks
• Seek information online and from other sources as to the kind of spend management and card platform options available to you
• Schedule discussions and demos of viable options for you along with a deeper understanding of the pricing
• Make a presentation to your board of directors along with a spend management partner to purchase and implement the solution

As you know in today’s world cash no longer rules the roost and various other modes of payment have taken over. Credit cards are one mode of payment that has been around for a few decades, and continue to thrive.  However, credit cards have also evolved from their original positioning as elite to being available for people from all walks of life. 

There’s been a paradigm shift in the way finance and financial services work with the changes in policy and the role that technology has started to play. The concept of credit cards to support personal and business expenses is not new. Today with modern financial services evolving, we see a big change in the way companies manage expenses. Often, it is with the help of business credit cards that they give their team to ensure quick and easy payments. 

However, even today, there’s a lot of confusion on what constitutes a business credit card vs personal credit card and how they differ. Let’s start by defining the difference and then focus on the top reasons to learn the difference between business credit cards and personal credit cards.

What is a business credit card?

As the name suggests, a business credit card is issued expressly for business purposes. More importantly, a business credit card in most instances is based on your company’s financial credentials. If you are wondering what a corporate credit card is, then it is similar to a business credit card.

What is a personal credit card?

As the name suggests, the bank or financial institution provides a credit card with a limit based on the personal finance credentials of the main applicant. 

The main differences between business and personal credit cards

Credit limit

The credit limit for the business credit card will be determined by not only the company’s financials but also the designation of the employee who will be using it. Also, the company can decide to allocate the overall credit limit they have to different people depending on the needs of the business.

For instance, the operations manager will have limits that will enable the payment of transportation fees, utilities, etc. In the same way, a salesperson who travels for work will have limits that meet travel and entertainment (TE) expenses. In most cases, the end-user of the business card may not need to submit their financial documents to get the limit. 

In the case of a personal credit card, the credit limit will be based on your financials for the past 1-2 years, your current earnings, your credit score, and if applicable, your credit history.

Rewards

The type of rewards and promotions for business credit cards will be more oriented to the benefit of the company rather than the individual. It could range from discounts on bill payments, fuel, or office supplies. For the personal credit card, the rewards and promotions are aimed at making their spending better and beneficial. These include a redemption of reward points for a gift of their choice, cashback, etc.

Statement

For business credit cards the statement is generated and sent to the company unless otherwise specified. For the personal credit card, the statement will be sent to either the individual’s address or email ID as the case may be. In many cases, the personal credit card will allow you to make part payments whereas that may not be the case with business credit cards.

Spending limitations

In the case of company credit cards, where you use the card, what you spend on, and how much you can spend could be restricted. In the case of personal credit cards, the limitations on spending are up to the user. Most of the issuers of credit cards for personal use enable the user to set limitations on where or how to spend. For instance, you can cancel online purchases and go with only point-of-sale usage. 

Now that we have done a comparison of business credit cards versus personal credit cards, let us look at the top reasons the distinction is important:

• Accountability: A corporate credit card or business credit card is issued for business expenses. When you make personal purchases on the card, it can create accounting issues and make bank reconciliation a mess
• Credit score: In case you use your credit card for business purposes and your company does not reimburse you on time, it can lead to default and a poor credit score
• Misuse penalty: Many companies have strict policies in place for the use of the business credit card and any personal use can often be penalized by imposing a fine or in extreme cases, even termination of employment

The differences between business cards vs personal credit cards are significant to establish accountability and a positive credit score. It is better to ensure that the usage is restricted accordingly.

A steady cash flow is essential for the growth of businesses or individual entities. Where tools like corporate credit cards allow the business more control over spending, revolving credit and a line of credit offer businesses more flexibility to manage their credit facilities effectively. Virtual cards are also a tool to help companies ease the process of making payments more securely.

Revolving credit and Line of credit are two potent financial instruments that allow businesses to gain financial assistance from lenders for their credit requirements. With the help of these financial instruments, companies or entities can borrow loans or credit assistance from other businesses or financial institutions to reinforce money into their own business.

Revolving Credit And Line of Credit: What’s the difference?

Finance facilities like standard credit cards, revolving credit, and lines of credit help businesses grow and expand. The two financial instruments are designed to offer businesses financial aid based on borrowing requirements.

A conventional agreement allows the business to borrow until it closes the account with the lenders. Whereas a line of credit or non-revolving line of credit loan is a one-time agreement between the borrower and the lender, and once the loan amount is paid, the agreement gets terminated.

The criteria for issuing the line of credit depends on the business’s creditworthiness. First, the company can borrow the amount until the limit is reached and keep repaying the lender partially or entirely, depending upon the repayment agreement between the two. Then, based on the credit score, the financial institute or the lender party can decide to extend the credit limit. Additionally, the business can again borrow when the lender extends the credit limit.

Revolving Credit Meaning and Significance

A revolving line of credit allows the business to borrow money from a set limit of funds from the lender. On account of the money lent the borrower has to pay the interest amount to the lender on preset due dates. When the borrowed money is paid in part or as full payment, the funds are again available to reuse for the businesses from their revolving line of credit loan account.

This cycle of borrowing, using, and reusing the amount from the revolving Line of credit loan account continues till either party decides to terminate the agreement.

The businesses are eligible for the revolving line of credit loan based on specific criteria like credit score, business type, funding history, and business revenue. The mentioned criteria help the lender understand the business’s financial positioning to acquire a line of credit loan.

Examples

A simple example of a revolving line of credit in India is the credit card facility provided by banks to their customers. In the case of businesses, banks offer loan assistance by providing funds to a specific credit limit. The revolving line of credit loan account keeps operating until either of the parties decides to discontinue the agreement.

The bank owns the interest charges on the loan amount sanctioned. As long as the business keeps paying the interest amount, the revolving Line of credit account continues to operate. Whether the borrower decides to pay only the interest amount for a set period or repay the entire loan once, the money gets replenished into the revolving credit account for the business to reuse.

Meaning and Significance of Line of Credit India

A line of credit or non-revolving line of credit loan is a one-time agreement between the borrower(business) and the lender. Once the borrowing party pays off the loan amount, the non-revolving credit account gets terminated. Unlike a conventional agreement, the borrower has to pay the interest amount plus the loan amount on preset due dates.

Example of Line of Credit India

For startup businesses in the growth stage, funds in the business account can be drained due to increased expenses. In that case, during payments, there is a high risk of checks bouncing, which can affect the business’s creditworthiness in the long run, so the businesses have to manage their finances carefully. Thus, to avoid check bouncing, the startups can apply for a line of credit to acquire overdraft protection when the balance is insufficient in the business account to make payments.

Can a business apply for instant loans without a credit score?

The revolving credit and Line of credit loans are designed to help businesses in case of financial inadequacy. Thus, many financial institutes offer the possibility of applying for a line of credit loans or instant loans without credit scores but based on specific criteria that the lenders formulate to safeguard their interest.

The lenders can agree to offer a loan amount against the corporation’s business assets that can assist as collateral. The lenders can also charge higher than standard interest rates on the loan amount sanctioned to the business.

Applying for a line of credit or instant loans without a credit score is slightly risky. However, many businesses still opt for it when analyzing the potential for their business growth. If a company can grow, it can rightfully apply for instant loans without credit scores.

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The growth of a business depends on various factors, one of which is the way a company makes payments. With the country rapidly moving towards digitization in different industries, digital payments in India have become the crux of thriving businesses.

Modes of digital payments like corporate credit cards and prepaid cards enable companies to make payments with ease and security to increase the overall performance marketing of growing businesses with its extensive prepaid company credit card features. Virtual cards are also a part of the same category of digital payments.

What Are Prepaid Cards?

A prepaid card, also known as a stored value card, is similar to a debit card with money preloaded on the card beforehand by the card issuer. Pre-loaded cards can be either physical or virtual, depending on the issuer’s choice.

Today, many digital payment companies in India encourage growing corporates to include prepaid company credit cards in their business for the card’s exclusivity and extensive custom features. Moreover, a prepaid credit card is one of the most reliable modes of digital payments that facilitate the financial growth of a company.

Significance of Prepaid Credit Card India

Prepaid cards are not linked to any bank accounts; the issuer can connect the card to a digital wallet which sources the money transfer. For example, businesses can quickly issue a prepaid company credit card associated with a digital wallet to their employees to undertake authorized business expenses on behalf of the company.

With the help of pre-loaded cards, the company can also undertake the process of disbursements faster. In addition, it also allows the company to provide incentives to well-performing employees by offering prepaid cards as gift cards with monetary incentives loaded into the card.

A prepaid company credit card enables the business to preload the cards with a specified budget issued to the employees as employee benefit, giving the company complete control over the business funds. Furthermore, as the employees have a tight budget to adhere to, they naturally become more responsible while making spending decisions.

A company in its growth stage may have funding requirements; for that, any lender or financial institution will evaluate the potential creditworthiness of the business. In such cases, the business can use a prepaid credit card to improve credit scores. As these cards are not directly linked to the business bank account, the transaction details do not show in the accounting records of the bank statements.

Prepaid Card Digital Payment: Advantages and Disadvantages

Electronically generated prepaid cards have significantly impacted the advancement of scaling businesses. As such cards are a prominent mode of digital payments in India, companies are gradually transitioning to prepaid company credit cards as it is easy to use and cost-effective.

Listed below are some of the imminent digital payment advantages and disadvantages of using a prepaid credit card in India.

Advantages

Prepaid cards are a great alternative to standard debit or credit cards. With companies transitioning to the digitization of their entire business process, prepaid company credit cards constitute a dynamic financial tool to make payments faster and easier.

Cards like these offer the business centralized authority over the company funds, as every transaction detail gets recorded accurately with the date and payment specifications in the company’s digital accounting records.

Cards that are prepaid not linked directly to the business bank account; thus, it has no impact on the company’s credit score. However, for a growing business with multiple creditors, maintaining good creditworthiness is essential for funding requirements which is possible through prepaid credit cards to improve credit scores as the transactions do not get recorded in the bank statements.

Businesses can easily set withdrawal limits on the prepaid company credit cards to ensure optimal use of the business funds, as these cards are preloaded with a specific amount the issuer sets.

Having a set amount on the card encourages the employees to use the card responsibly and make informed spending decisions to avoid exhausting the set budget before time.

Disadvantages

Many digital payment companies in India offer prepaid card facilities to growing companies but with hidden fees like transaction fees, monthly maintenance fees or overdraft fees. Therefore, companies must choose a reliable card service like cards from the pool of digital payment companies in India.

As the transactions made through cards that are pre-loaded not recorded in any financial bureau, it does not account for boosting credit scores. As a result, the company cannot achieve better credit scores even with the most cognizant use of pre-loaded cards.

Pre-loaded company credit cards do not accrue any interest, so the amount stored in the card remains the same with or without withdrawal. This means that the amount on that particular card is as good as having physical cash in hand.

Benefits of Reloadable Prepaid Cards in India

Prepaid Cards Benefits

Prepaid cards are preloaded by the issuer/company with a set withdrawal limit. Therefore, prepaid company credit cards give the company complete control over the business funds as the employees cannot go overboard and spend extra cash.

Cards like these are reloadable, which allows the company to deposit money into the cards as and when required.

The company can decide whether it wants to reload the pre-loaded company credit cards monthly, quarterly, daily, or yearly based on the use of the card explicitly issued to each employee. This ensures that the company can curb the risk of financial leaks by allocating business funds rationally.

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A corporate credit card is an incredible financial instrument for businesses to carry out financial tasks with ease. It offers the business complete and centralized control over the company funds, which ultimately allows them to take strategic business decisions regarding necessary expenses.

Corporate Card: Meaning and Advantages

A corporate credit card is a financial tool similar to a standard credit card but is used essentially for corporate needs. The company issues these cards to a selective group of employees to carry out important financial expenditures on behalf of the corporate firm. To further simplify corporate card meaning and its extensive usage for growing business, listed below are some of the most prominent advantages which make it the ultimate financial instrument for businesses.

• A corporate credit card allows the business to manage, control and streamline all the company funds under one domain
• A business can track its financial expenditure and formulate strategic plans to curb unnecessary spending with corporate credit cards, India
• The company can even set limits on the card to avoid incidents of overspending
• Also, with the help of corporate credit cards, companies can now have a bird’s eye view of their business finances; this allows them to track any potential financial leaks
• Additionally, a corporate credit card in India improves the employee’s efficiency and productivity exponentially, as they do not have to go through the complicated procedure of reimbursements

A corporate card opens a multitude of excellent business growth opportunities, but only if the company has a stringent and reliable corporate card policy in place. In addition, a corporate credit card policy and procedure allows the company to set proper regulations for the employees to adhere to and benchmarks for other corporates who want to do business with them.

Also, corporate credit card is easy to use and functions exactly like a standard credit card. But compared to regular credit cards, a corporate card is more secure and convenient to use. Additionally, it allows the company to set limits on the withdrawal amount irrespective of the available balance amount on the card. However, firstly, a corporate credit card must be loaded with funds by the company to make transactions possible. As a next step, employees must be informed about the corporate credit card policy that highlights the usage rights to avoid accidental or deliberate malpractices.

What is Corporate Credit Card Policy?

A corporate credit card policy is all the listed regulations that employees must abide by as these are complaisant rules for responsible and fair usage of the corporate card. The policy holds the power of accountability, responsibility and usage rights applicable to the cards issued by the company to the employees to make authorized business expenses.

The company formulates the corporate credit card policy and procedures to protect itself in case of any unauthorized or unfair use of the card. In addition, the card protects the employees in case of phishing, as a corporate credit card is a highly secured financial instrument.

Importance of Corporate Credit Card Policy and Procedures

Having strict corporate credit card policy guidelines enables the business to avoid the risk of misuse by employees. The guidelines are binding to the employees and ensure fair and authorized usage.

The purpose of the corporate credit card is defined in the policy to help the employees understand their contractual agreement for making payments on behalf of the company. The company expense process and policy educates the employees on their role and responsibility with regard to the corporate card issued to them.

The business credit card policy guidelines clearly define who is eligible to use the card and under what circumstances to restrict employees from sharing the cards with other employees who are not entitled to use them.

Furthermore, the company also gets complete control over the spending limits on every corporate credit card, which complies with the policies and guidelines to avoid deliberate or accidental overspending by employees.

A company-provided credit card policy document is available to the employees to ensure they completely conform to the policies stated to avoid causing any unintentional accounting lapses.

Corporate Credit Card Policy Best Practices

For companies that deal with multiple vendors, issuing a corporate credit card to their employees simplifies the accounting procedure just like credit policy makes lending easier. It also reduces the efforts required to apply and approve funds between the management and the employees for the use of business expenses.

But issuing corporate cards to various employees can also lead to problems like accidental or unauthorized spending by the employees. That is why the company needs to set firm corporate credit card guidelines before handing out the cards to ensure fair use of the corporate card.

Below are some of the foundational corporate credit card best practices to ensure the employees understand and comply with them.

• Stating clear and concise responsibilities that come with holding a corporate credit card. The employees should know the repercussions of misuse and the benefits of proper usage of the corporate cards beforehand
• Corporate credit card spending limits should be informed to the employees to ensure they take strategic financial decisions on whether or not the expense is a top priority at the moment
• Authorized expenses should be listed in the policy clearly to make sure the employees avoid instances of personal spending using the corporate credit card in India
• Additionally, the business credit card policy guidelines should mention steps to take in case the card gets stolen or lost

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Many businesses that operate on a small and medium level have gained huge success and have been able to scale their company profitably with prepaid credit cards, as they are regarded as a powerful financial tool to manage business expenses. Moreover, in the wake of digitization, it has become even more critical for organizations to adopt prepaid cards to ease the process of managing company accounts payable.

Significance of prepaid credit cards in India

Prepaid credit cards are an essential financial instrument that every business needs to grow in India. Corporate prepaid credit cards allow your business to allocate its working capital resourcefully and avoid the risk of financial fraud.

Having a limit set on the prepaid credit card enforces a sense of responsibility in the employees’ minds as they must adhere to the available balance on the card. This way, the company can control where the business funds are getting used and whether or not it is a priority to make that expense.

Corporate prepaid card solutions: the most efficient way to accelerate business growth

When a business is in a growth stage, it is common to have multiple employees work in one department, like the finance department having more than one employee managing the company finances. And even though issuing corporate cards to multiple employees makes the business process efficient, it raises the risk of misuse of the business funds. That is why it is crucial for corporations issuing multiple corporate cards to shift to prepaid credit cards to have more control over their working capital.

Let’s look at some of the most prominent reasons why corporate prepaid card solutions are the most efficient way to accelerate business growth.

Financial Control: With prepaid credit cards, businesses can set spending limits on the cards issued to employees. This way, the company can have complete financial control over the working capital. Furthermore, corporate prepaid card solutions ensure timely payments for organizations dealing with multiple vendors and creditors. In addition, businesses can easily set recurring payment options, which automate the payment process and reduce employees’ workload.

Streamline Accounting Process: With EnKash prepaid credit cards, companies can view where the business funds are being used. The corporate prepaid credit card enables them to track every transaction with utmost accuracy. In addition, the EnKash spend management feature allows the company to view all the vendor databases, including the invoicing details, in one place.

Ease of Invoicing: If a business trades with many suppliers, managing invoices becomes challenging as the company needs to maintain the receipts, fill in the details in the accounting records, and then make timely payments. The entire process is tiring and runs the risk of errors in the accounting books, as it is humanly impossible for employees to record massive data with 100% accuracy. With EnKash corporate prepaid card solutions, businesses can automate their digital payment process, like invoicing, recording, managing, and sending payments.

Allocating financial resources: For growing businesses, it is essential to strategically allocate financial resources to avoid losing business funds. Companies in the growth stage aim at diversifying and delegating, which might lead to the draining of working capital if the employees handling the business finances do not use the financial resources appropriately. That is why it becomes even more critical for growing businesses to issue prepaid credit cards encouraging the employees to make informed and strategic purchase decisions.

Reloadable: A prepaid credit card not only reduces the risk of overspending but is also a great alternative financial instrument for companies as these cards are easily reloadable. Companies function for an extended period, and thus it is expected that they will incur substantial business expenses every month. With corporate prepaid credit cards, the company can quickly reload the cards monthly with a budget.

How do reloadable prepaid cards work?

• Reloadable prepaid credit cards are relatively simple to use. Businesses can claim the card and easily activate it with just a few simple steps. Once the card is activated, the company can load the card with funds by direct cash, bank transfer, online payment, or by linking the company bank account
• With reloadable prepaid cards, the company can opt to transfer funds into the cards weekly, monthly, or even daily based on the needs or the frequency of the card’s usage
• In addition to setting the budget on the cards, the corporate prepaid card solutions enable the business to set a limit on the amount that can be used daily to further reduce instances of reckless spending

Digital payments through payment gateway are the best way to make business transactions, as they are convenient, easy to process and track, and, most importantly, they enable the business to control spending limits. Additionally, for growing startups and enterprises, issuing prepaid credit cards to employees enables the business to streamline the company’s business funds and provides it with centralized authority over the business cash flow.

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