Establishing Rules For Using Corporate Credit Cards

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Establishing Rules For Using Corporate Credit Cards

Thursday, May 31st, 2007 Subscribe To Our Feed

by Robert Bain

Are you thinking about obtaining corporate credit cards but you aren’t sure if they are a good idea? As long as you handle the use of them effectively from the start they will be a very useful tool for operating your business. These days plenty of it can be done online, but there will likely be workshops, events, and even meetings you or your staff need to attend out of town.

It is unreasonable to expect your employees to pay for their own transportation, hotel rooms, and food when they are traveling for business. It can be a burden for them to pay the expenses out of pocket even if you plan to reimburse them for it later. The best solution is to offer them the use of a corporate credit card to cover all of those expenses. You will find plenty of different businesses will offer discounts when you use a corporate credit card as well.

Remember that a corporate credit card is credit - and you are going to have to pay the charges that are incurred on it. You can avoid finance charges by paying the balanced due in full. Look for low cost flights, rental cars, and hotel rooms so that you can keep the charges on the corporate credit cards as low as possible. Many organizations will offer discounts and rewards programs you can take advantage of to save money.

The internet is a great place to find deals for business travel and to save money. You can make all of the arrangements online and secure them with a business credit card. The one item you can’t cover this way though are meals for the employees. Make sure you give them a reasonable allotment that they can charge on the corporate credit card each day for meals. Keep in mind that some places they will travel to are more expensive than others and make necessary adjustments accordingly.

You also want to make the corporate credit card available for entertaining possible business associates. This may be to extend an invitation for a nice meal or a round of golf. It is a good policy to require these types of corporate credit card charges to be approved by management rather than the employees deciding when to do this

Most credit card companies will issue you several corporate credit cards on the same account. This is very useful when you have several different employees that will be traveling on a regular basis. It also allows you to keep track of who has them with them and who you will need to give one out to before they attend a seminar out of town occasionally.

Find out how the credit card company is going to report the charges on the corporate credit cards to you. There is no reason for you to spend hours going over the statements to find out which charges belong to particular employees. If you have any concerns about charges on the corporate credit card you want to be able to easily identify the employee you need to discuss it with.

Placing limits on corporate credit cards is a good idea from the very beginning. While most employees will be very responsible with them, not all of them will have the same good judgment. Since they use their personal credit cards as they wish, they may think the same circumstances apply when you offer them one. While business travel expenses are part of doing business you want them to be reasonable.

About the Author:

About the author: Robert Bain is a seasoned business author. Read the ups and downs of small business credit, building business credit, aged and shelf companies and many more topics. Don’t reprint this exact article. Instead, reprint a free unique content version of this same article.

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