Corporate cards: A boon to corporate travel management?
Corporate travel management is quite a task, as would be attested by travel managers worldwide. One of the key areas of concern remains corporate expense management. Business travellers today are dynamic in their demands and every aspect of their travel needs to be in tandem with this change. In that regard, a recent study conducted by the Association of Corporate Travel Executives (ACTE), in collaboration with Mastercard and the NAPCP has brought exciting new insights about corporate travel spending into the light.
According to Evolving Payments in Corporate Travel, 67% of organisations use corporate travel cards when it comes to travel expense management, 63% prefer using it and 60% are extremely satisfied with the usage. With such high satisfaction rates, there is no question about the popularity of corporate cards. Let’s decode why they are so popular. The benefits present themselves to both travel managers and business travellers.
Corporate cards eliminate the requirement of upfront payments, therefore completely ousting the tedious reimbursement process for travellers. Non-cash payments make expense tracking an easy process for travel managers as well. This, in turn, reduces the chances of expense fraud. So, at a time which has seen a clear migration from legacy to new age functionalities, corporate cards allow for great ease of use as well as compliance.
The other most prominent advantage of using corporate travel cards is the cash rebate. Most of these offer an annual cash rebate option between 1% to 5%, depending upon the type of card, purchases made, category of goods bought, etc.
Corporate cards are also versatile and allow the scope for customisations. This makes corporate cards a perfect fit for the evolving nature of business travel which has seen increasing reliance on bespoke customer journeys. Corporate cards permit the inclusion of added benefits including airport lounge access, loyalty points, discounts on purchases and others.
Corporate cards far outshine personal cards in their utility and functionality as far as new age business travel is concerned. However, newer modes of travel payment are already making their entry into the domain. In spite of the benefits, corporate travel cards are not entirely flawless. This is where virtual cards have successfully made their initiation in the corporate travel regiment.
Virtual cards, with unique single or multi-use account number for all business travel purchases, allow travel managers to place a spending limit on travelling employees. Since they’re virtual, they eliminate the need for surveillance of traditional cards, enhance compliance and reduce the tension of monitoring credit limits. The best part is that virtual cards are a great fit for non-regular employees as well, including contractual ones, non-frequent fliers, interns as well as interviewees. These cards capture spending data better, which can then be utilised for tailor-fitting travel expense policies by the organisations.
Currently, both corporate and virtual cards are enjoying a certain preference among business travellers and organisations worldwide, with no distinguishable leanings. Only future usage will determine which payment method battles it out to the finish line.