How Employee Expense Cards Prevent Overspending and Increase Accountability?

Traditional expense management continues to cost businesses heavily. A report by ACFE suggests that companies around the world lose 5% of their revenue to expense fraud. A leak that often goes unnoticed. On top of that, finance teams are often stretched thin, with most of their time spent on chasing receipts and processing reimbursements.

The pain isn't one-sided. Research reveals, 78% of employees say that the expense report process is too time-consuming. This leads to employee frustration and low morale. The solution here is a more transparent and easy-to-control expense management. This is where employee expense cards come in.

What Are Employee Expense Cards?

Employee Expense Cards are prepaid cards that are issued by companies to employees for managing business-related expenses. CleverCards is a leading company that offers Business Expense Cards. These are digital Mastercards that can be ordered online and sent to employees instantly via email.

With over 64% of businesses moving to a hybrid model, the need for an automated, real-time expense management solution is imperative. Using CleverCards' Business Expense Cards, employers can:

• Instantly issue digital prepaid Mastercards online. Saving both time and money on manually procuring and distributing physical cards.
• Configure spend limits, spend categories, and track employee expenses in real-time through a dashboard, ensuring more transparency.
• Employers in Ireland must report employee expenses to Revenue. But when using CleverCards' digital prepaid expense cards, no reporting is required.

Corporate Credit Cards Vs. Employee Expense Cards

Since corporate credit cards have long been the standard, businesses may feel more inclined to stick to traditional methods of expense management rather than switching to a new-world solution.

Which is why it is important to weigh the pros and cons of both corporate cards and employee expense cards. This is how different features compare to expense management solutions:

1. Issue and Distribution: Corporate credit cards are physical cards that take weeks to get issued and then be distributed. This is time-consuming and requires admin effort. While employee expense cards can be signed up for online and issued to employees instantly over email. Which means, no manual distribution required.

2. Spend Control: Corporate credit cards are linked to a company's bank account and have shared spend control. Prepaid employee expense cards, on the other hand, like the one offered by CleverCards, allow you to configure spend categories, spend limit, approval flows, and other variables.

3. Expense Tracking: With corporate credit cards, the transactions are visible after the billing cycle. With expense cards, employers can monitor business expenses in real-time. This makes it easy for businesses to track which employees are spending where and how much.

4. Reporting: Corporate credit cards require manual compilation of data, receipts, and expenses on spreadsheets. Expense cards enable automated reporting with all expenses streamlined in one view for easy visibility.

5. Risks and Fraud: Corporate credit cards are prone to risks and fraud due to delayed tracking and manual processes. Prepaid expense cards, on the other hand, minimize risks with real-time tracking and prepaid balances.

Corporate credit cards have served businesses for decades, however their limitations are hard to ignore. Not every company has access to one, especially smaller businesses or startups. And even when they do, many business owners hesitate to share company cards with multiple employees.

That’s where CleverCards Business Expense Cards come in. They offer the flexibility of a card with the control and transparency businesses need, without the hassle of credit checks, long application processes, or sharing sensitive financial information.

How Do Employee Expense Cards Prevent Overspending?

When businesses lack a clear expense workflow, budget leaks and overspending become inevitable. One of the most effective ways to reduce overspending is to use a prepaid expense card. Here's how expense cards for business offer a proactive solution to control employee expenses:

1. Prepaid Expense Cards

A major challenge with traditional expense management is a lack of control over the expenses until after it is spent. Prepaid employee expense cards solve that by offering pre-loaded cards that have a fixed top-up amount, ensuring employees can spend only what is approved.

2. Real-time Visibility

Employee expense cards help finance teams monitor employees' expenses from a centralized dashboard. This ensures transactions are overseen in real-time and no fraud takes place. In case of expense breach or misuse, cards can be instantly frozen to avoid potential harm.

3. No Shared Access

Unlike traditional expense cards, employee expense cards can be issued to individual employees without any shared access. Each card is directly linked to the spender and the spend. This approach ensures there is no unauthorized access to the corporate expense allowance.

4. Category Restrictions

With CleverCards, employers enjoy the flexibility to configure specific spend categories along with limits and validity dates. This prevents non-work-related purchases which is a common source of expense fraud and overspending.

Increase Accountability With Prepaid Expense Cards

Shared cards, vague policies, and open spend limits often lead employees to lose sight of financial accountability. Over 24% of employees have admitted to passing off personal expenses as business expenses. It's not just employees, employers struggle too. Finance departments struggle with missing documents, manual tracking, and expenses mismatch.

Prepaid expense cards bring structure and accountability into company spending for both employees and employers. With individual cards, pre-approved spend limits, and real-time spend tracking, expense cards ensure expense management mentality shifts from a 'spend and deal' to 'own and control' attitude.

Need a walk-through on how CleverCards can simplify expense management for your business? Fill out the form below, and we will reach out to you