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The Benefits of Business Expense Cards [+ Free Expense Form Template]

9 min read

According to a recent study, UK workers are out-of-pocket by £51.2 billion in expenses every year. A whopping 43% claim they’ve been unable to pay personal bills due to late expense reimbursement from their employers. Aside from the financial stress that this puts on employees, managing an expense log and expense reimbursement process also creates a lot of extra work for your managers. One solution to this is using business credit cards. However, this doesn’t reduce the time your managers need to spend on expense management. A far more efficient way of managing allowable expenses for employees is offering a company expense card to certain members of your staff. 

So, what are business expense cards and how do they differ from traditional business credit cards? And how can expense management software and products like the Factorial Card help you streamline and improve your expense management processes?

Let’s find out.

What Are Business Expense Cards? 

Business expense cards are the most effective expense management tool on the market

Essentially, they are prepaid debit cards that employees can use to cover any allowable business expenses that they incur. These might include travel expenses, expenses related to the purchase of tools and supplies, general business expenses, and employee stipends, to name a few. Instead of paying upfront and then applying for expense reimbursement, employees can use an expense card to pay for goods and services in line with a company’s defined expense policy.

With business expense cards, employers get a lot more control over employee spending. For one thing, each card is linked to a specific employee, and each payment is assigned against a specific budget. Spending limits can be set, and all expenses are processed and approved (or rejected) through in-house expense management software. This offers companies the right balance between access to funds and financial control

Business Credit Cards vs. Business Expense Cards 

You might be thinking that all this sounds very similar to what you get from company credit cards for employees. However, an expense card actually works in a very different way.

Here are some of the key differences between business credit cards vs. business expense cards.

Issuing Entity

Business credit cards are issued by banks in your company’s name. You can then offer them to certain employees to spend on allowable business expenses. Business expense cards, in turn, are issued by you directly to individual employees, and the cards are in their names. This makes expense management much easier as each employee has their own expense card (instead of multiple employees sharing a departmental credit card, for example). So no need for a clunky expense form or for paying expenses through payroll!  

Debt vs. Credit

With a business credit card, employees build up a debt which you, as the employer, then need to repay to the bank. With an expense card, you pre-load money onto a central platform that employees can then use to cover their allowable business expenses. 

Data Access

With an external business credit card, the only way to monitor employee expenses is through digital or paper bank statements. With an internal expense card, data is linked to a central platform where you can view expenses online in real-time using a computer or smartphone application.

Expense Receipts

When an employee uses a business credit card to pay for an expense, you then need to wait for them to provide you with the corresponding expense receipt or invoice before you can approve and allocate the expense. With an expense card, receipts are scanned into an expenses app and automatically assigned against each individual expense

Expense Limits

Instead of using a shared company credit card with an overall expense limit, you can assign individual limits to employees based on their anticipated level of spending. This makes it much easier to control individual expenses and ensure your expense policy is being adhered to.  

How Do Business Expense Cards Work? 

We’ve looked at some of the features involved in an expense card. Now let’s take a look at how they work. 

  • As the employer, you first need to apply for an expense card account through an issuing entity. This might be the Factorial Card, for example. You then assign individual expense cards to each employee who needs one. Cards are in each employee’s name and linked to individual profiles on a centralised platform.
  • Once you’ve done that, you need to distribute the business expense cards to all relevant employees and make sure they understand how they work. It’s best to detail all this information in your expense policy so that everyone understands the process, in addition to guidelines on allowable expenses for employees. 
  • The next step is to top up each card with funds. You can do this on an individual basis. That way, everyone has access to the funds they need for their anticipated expenses. 
  • Once you’ve done that, your employees can use their business expense cards when needed. To process a payment, they simply need to register the expense on the expenses app alongside a photograph of the corresponding expense receipt. Each expense is allocated to an individual employee and a specific team budget. 
  • After an employee submits a payment request, you or their manager will be notified so that you can approve or reject the expense. If you approve the expense, then the payment will be processed immediately. 
  • To help you control these expenses, you can set limits for each expense card and activate and deactivate cards instantly. You can also consult all information in real time through the dashboard and generate an expense report when needed. 

Benefits of Using Business Expense Cards 

Here are some of the specific benefits of using business expense cards in your company.

Easy Access to Company Funds

Business expense cards streamline the process of requesting approval to spend company money. Instead of submitting a manual request and waiting for approval, employees can submit expenses directly from their smartphones. The corresponding manager can then access expense requests immediately to approve or deny them

This is especially beneficial if you currently rely on departmental credit cards. For one thing, employees may have to wait for the person holding the credit card to return to the office before they can use it. Instead, everyone has their own expense card with an allocated budget

More Control Over Expenses

You and your finance managers get more control over allowable business expenses, especially compared to traditional company credit cards. And because every employee has their own card, it’s much easier to track individual expenses. Plus, you can establish clear limits for each card so that employees stick to your expense policy and don’t go over budget. 

Streamlined Reporting

Instead of reconciling each expense report with company credit card statements, you can generate an expense report directly from an expenses app linked to the expense card. And because expense receipts are automatically allocated against expenses, you also don’t need to trawl through mountains of paper receipts when you create an expense report.  

Access to Real-Time Data

You get much more transparency when you use business expense cards compared to credit cards and reimbursement claims. This is because you can access all expense data at the click of a button through the expense card software. Your finance manager can also monitor company spending in real-time and reconcile payments against expense categories and departmental budgets using clean and transparent data. This saves everyone involved valuable time and money. It also provides those who need it with useful insights into company spending. 

Using Factorial Cards for Your Business 

At Factorial, we have launched Factorial Cards as part of our expense management software. These are business expense cards that your workforce can use to manage their own employee expenses. Whenever they encounter an expense, they can pay for it using their Factorial card and the expense is automatically recorded in the expense app. A message is then sent to the administrator who can approve or reject it at a glance. This makes the entire expense management process much simpler for everyone involved.  

Our all-in-one expense card offers you everything you need to manage your company expenses in a much smarter and more time-efficient way. You get the right balance of security, flexibility and control so that everyone in your company is happy. Plus, you can easily adapt the cards to your specific business needs so that you can monitor your employee expenses in real-time and keep a firm grip on your budgets. 

You can also use the Factorial Card to:

  • Automate your expense management processes and procedures
  • Set limits for each individual card
  • Activate and deactivate cards
  • Temporarily freeze employee cards when someone is on leave
  • Make secure payments
  • Get instant notifications when an employee processes a payment. 

Plus, you can easily integrate the Factorial card with your expense management software solution to streamline your expense reporting processes (more on this later in the post).

Let’s take a look at some of the specific features of the Factorial Card.

Virtual and Physical Business Expense Cards 

With the Factorial card, you can choose between physical or virtual business expense cards, depending on the personal preferences of your employees. Some employees might prefer a traditional physical card. However, many others are likely to prefer a virtual expense card (especially employees from younger generations).

Having the option to use a virtual expense card offers you and your employees a number of benefits. For one thing, you can allocate funds directly to an employee’s digital wallet. That way they can process expense payments directly from their smartphones instead of using a traditional plastic card. 

A virtual expense card also makes it much easier to process online payments instead of manually entering card details each time an employee processes a payment. Plus, once you issue a virtual card to an employee, they can see it instantly on their Factorial mobile app (instead of waiting until they are able to meet with you to collect a physical card).

Whether you opt for physical or virtual cards, the process for activating them is simple:

  • Fund your account. Create your funding account and receive an IBAN to perform top-ups.
  • Create your cards. Start creating cards for different purposes and set limits.
  • Automate expenses. Track all purchases and integrate them with Factorial Expenses.
  • Save time! Relax while we do the hard work for you with our optimised workflow.

And that’s it!

Real-Time Expense Tracking

Another great feature of the Factorial Card is that you get access to real-time expense tracking. 

For example, each time an employee processes an expense, you receive an instant notification. This helps you monitor how much your employees and departments are spending. You can then approve or deny payments in seconds, helping you maintain control over your allowable business expenses. You can also achieve more control by setting budgets and modifying spending limits so that there is no risk of anyone accidentally or intentionally overspending. 

Employees get a number of benefits too. Using their own version of the expense app, they can keep track of their own expenses and see if and why an expense has been approved or rejected. Plus, because all payments come from an allocated fund, employees don’t incur any out-of-pocket expenses or have to file manual expense claims at the end of each month. That means no need to keep a fiddly and time-consuming expense log or to manually keep track of expense reimbursements. 

Finally, although Factorial’s expense management software already provides you with a wealth of valuable expense reports, with Factorial Cards, you get an extra level of business insights. For example, you can assign expenses to specific projects and analyse which projects are creating the most value for your business

Customisable Payment Methods for Business Expense Cards

With Factorial Cards, you can customise payment methods in line with your preferences and requirements. After all, it’s your card, so why shouldn’t you decide?

Employees can also select any currency when they submit an expense, which is highly valuable for employees who need to travel abroad on business trips. The currency they select will then be visible on all expense tables, dashboards, and expense reports for your convenience. This is much easier than juggling fluctuating exchange rates for travel expense reimbursement claims. 


Automate Expense Management with Factorial 

Let’s finish by taking a look at how you can integrate Factorial Cards with our expense management software tool

Expense management software is used by employees to manage and report their expenses, as well as file expense reports and reimbursement requests. Managers can review requests in one place and accept or deny them as necessary. The right solution streamlines the process as employees upload receipts directly and managers can easily review them in their own time. This helps businesses keep on top of their expenses whilst reducing the time spent processing paperwork. It also helps to ensure compliance with HMRC rules.

With Factorial Expenses, you get the benefit of efficient expense management with all the added features of Factorial. Literally, all in one. This is because our expense management software is included in our general HR software. With our time and expense tracking solution, employees can automatically upload their expenses and receipts and classify expenses according to categories. Managers can then review expense reports in their own time and accept or deny expense reimbursement requests. Plus, you can generate detailed expense reports to gain valuable insight into where your company’s money is being spent.

And the best part is, you can easily integrate our Factorial Cards with our expense management software. This helps you gain added visibility over your employee expenses and reduces the time you spend compiling expense reports and processing expense reimbursements manually through payroll. This saves you resources, helps you cut costs, and boosts your overall productivity. That way, you can refocus your efforts on more strategic tasks that help you take your business to the next level

You can find out more about Factorial’s business expense cards and our expense management software here:


Emma is a Content Writer with 5 years of Marketing experience. She specialises in HR strategy and modern workplace trends. When she's not writing, she's running by the beach or cooking Italian food.

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