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Painless Payment – Can corporate cards contribute to a great travel policy?

Blog post   •   Dec 20, 2018 08:06 GMT

According to one of our latest pieces of research, six in ten global business travelers have a corporate credit card but only four in ten use it regularly when traveling for business.

The use of payment methods other than corporate cards is a pain point for travel managers, travelers and Travel Management Companies (TMC) alike. For the former, it makes tracking expenses more difficult; and for the latter, it means wasted time filing receipts. For the TMCs, spending time on admin tasks like managing vouchers to prepay for hotels and creating manual invoices – doesn’t add much value for customers – so all round, a lot of wasted time.

In the end, it all has the undesired effect of making a lot harder to review, monitor and, therefore, enforce travel policies.

Despite the fact that the research data shows that company credit cards are the preferred method for paying when traveling for business, the percentages – 43% for companies and 39% for travelers – tell us there is a still a long way to go to make them more widely used.

Companies may worry about misuse of corporate cards but this is a very small risk taking into account that, very often, corporate cards are linked to the travelers’ personal bank account.

And even when they are not, the trick here is to have a clear policy that bans the use of corporate cards for personal purchases.

Corporate cards are the most efficient way of paying for your travels and we encourage you to adopt it if you haven’t already.

At the end of the day, the more difficult tracking expenses gets, the more difficult it becomes to address policy bridges and take action to tweak it to make it more effective.

We know this very well which is why we created CWT Travel Consolidator. This revolutionary tool tracks all the different sources of spend and consolidates them so the travel manager can see more clearly the total cost of trips. In turn, this allows them to negotiate better deals with suppliers, ensure traveler compliance, and save an average of 2-7% on travel spend.

Another great solution is the use of virtual cards. These act like digital credit cards but the parameters of use can be defined – amount, expiration date, merchant, etc. – and they enable centralized billing.

Virtual payment transactions use a unique ID, making it both easier to identify and track a transaction, and also practical in stopping fraudulent use. It is a safe and attractive option for companies looking to centralize payment, reduce payment inefficiencies, liabilities and potential corporate card abuse – which in turn gives employers greater flexibility.

Virtual payment also solves many issues and challenges found in using traditional corporate credit card programs including:

  • Availability - Not every employee who travels is issued a corporate card.
  • Security - Credit cards can be lost, stolen, cloned or misused. Virtual payment lets companies tailor usage parameters including credit limits, dates of use, where it can be used, all of which increase travel policy compliance and decrease fraud.
  • Reporting -  All required reporting data is captured as the virtual card is created, resolving reconciliation headaches.
  • Compliance - Virtual card limits can be set up to only allow in-policy purchases.

As you can see, there is a lot to be won so choose your cards and go for a winning hand.

Blog author: Cédric Barbesier, Director, Products & Digital Sales, CWT Solutions Group.

Comments (1)

    I work only with centralised payments through virtual credit cards (VCC) or travel accounts. We have a very close and succesfull cooperation with your nordic organisation.
    I don´t really get how you can recomend the plastic corporate card!? That is a consumer product in disguise. It only provied level 1 payment data. On the other hand VCC´s and travel accounts are real B2B products that creats value for companies.

    The main difference in these two payment methods in my book is that the travel account is level 3 payment (it handles both referenses and VAT) the VCC is only level 1 payment but it can be enriched without involving the traveller.
    How do you capture all required reporting data with a VCC transaction? I understand that you can add referenses but how do you capture the VAT?
    We can capture the VAT in the transaction moment with travel accounts and we can enrich the VCC transactions with VAT in retrospect without involving the traveller.

    One thing that can be added to the value of virtual and centralised payments is the possibility to automate VAT reclaim. The easiset way to lower a companies total cost of travel is usually just to make sure that all VAT from abroad trips is reclaimed. That is a hassle when travellers are using plastic corporate cards but easy with centralised payments.

    My message to the Nordic travel managers I´m in contact with constantly is to book the hotels at CWT, use a centralised payment method and the result will be lower total cost of travel.

    Merry Christmas

    - Tobias Persson - Dec 20, 2018 10:42 GMT

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