In today’s dispersed and remote world, credit cards are an efficient payment method for business purchases. But not every employee needs a corporate card, meaning many use their own personal credit cards.
In fact, when looking at what payment methods employees have recently used for work-from-home purchases, the most popular method was a personal credit card (58%), followed by a corporate card (20%), per research from Oversight.
3 key considerations
Recognizing how much personal credit cards are being used, you’ll want to ensure your finance team is taking steps to maintain control and minimize risk. Here are three best practices to share:
1. Continually communicate spend limits and policy. With corporate cards, your company can set automatic spend limits and controls that don’t let employees buy items over a specific dollar amount or items of a certain type/category.
When employees use their own cards, your company doesn’t have that type of control. That means your team must go the extra mile to ingrain card policies in employees’ heads (e.g., training, email reminders). Doing so can deter confusion or problems that come up after employees have submitted for reimbursement.
2. Double-check each expense’s business reason. Employees are putting both personal and work charges on the same card. So, it becomes even more important for your team to ensure that no personal expenses are accidentally (or fraudulently) making their way onto expense reports.
If there’s an expense that could be personal or work-related (e.g., a computer monitor), reassure your team that they shouldn’t be afraid to verify with the employee or approving manager that it’s for business use.
3. Make those reimbursements a priority. The majority (78%) of full-time U.S. workers live paycheck to paycheck, according to CareerBuilder.
You know it’s key to be empathetic. So, encourage your team to keep an eye on who’s using personal credit cards, especially for large-dollar purchases. Then your team can expedite reimbursement. (This is especially relevant right now, since the economic downswing is creating financial hardships for many.)