The biggest perk attached to corporate cards is the ease of tracking employee spending. It’s not necessarily ideal for employees, who may not have the cash available to pay for large charges until their expense report is processed. That means the employee must stay current on paying the bill in the short term and request reimbursement upon filing an expense report. Some corporate cards also offer what’s known as individual liability. When the company guarantees the debt, the owner is not held responsible if, for instance, the company fails without paying its bills. With most corporate cards, the company is generally liable for the debt on employees’ cards, which is a big advantage in many owners’ eyes. With joint and several liability, a creditor can pursue either the business or the owner for a debt. Typically, a small-business owner must personally guarantee a small business card, though some small business cards come with joint and several liability, where the owner shares liability with the business. Responsibility for the debtīusiness cards are issued to an individual and the company (unless it is a sole proprietor), and even if additional cards are added for employees, the business owner is responsible for managing payments. The application process is much less intensive and usually doesn’t require an audit of company finances. Unlike corporate credit cards, business cards are available to businesses of any size – even entrepreneurs just getting started on their own. However, corporate cards come with certain benefits that small business cards don’t offer – and vice versa. Most also offer features that make it possible to track expenses easily.
How corporate cards differ from small business credit cardsīoth corporate and small business cards offer conveniences such as the ability to set limits on employees’ spending and to restrict spending to certain categories. In the case of the One Card from Capital One, businesses earn competitive rewards up to 1.5X net purchases. However, it is also the company that reaps any rewards the card may include, including statement credits or travel perks.
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Once an account has been opened, the company is responsible for paying the balance in full each billing cycle and managing spending of each cardholder. The bank can also match companies that spend $20 million or more on travel with corporate credit cards.
Morgan is available to businesses that spend between $1 million and $9.9 million per year.
Cards are issued to the company itself (rather than any individual) and require that you submit your tax ID and require an audit of company financials before approval. A company may have to submit a federal tax ID and undergo an audit of its financials to qualify.įor example, the One Card from Capital One requires its users to have a minimum annual card spend more than $1 million. What is a corporate credit card?Ĭorporate cards are generally available only to larger small businesses, meaning those with at least several million dollars in annual revenue. However, for larger small businesses, getting a corporate credit card, like the ones big corporations issue to employees, often makes sense. Many are designed to reward the types of purchases that employees typically make in a small firm. Whether your employees fly a lot and need a card to reserve plane tickets or they purchase lumber or office supplies for the company at the store, getting them a company credit card is often a great way to keep track of expenses and make it easy for them to purchase what’s needed.įor many entrepreneurs, a small business credit card is the best solution.
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