7 ways prepaid card help both employers & employees

Expenses have long been a cause of frustration for employers and employees.  Finance departments have spent countless hours chasing paper trails whilst employees have fumed at their desks wondering how a simple expense claim can possibly take so long.  All that time-consuming negative energy is rapidly becoming a thing of the past with the increasing popularity of prepaid credit cards for business. A prepaid card operates like a company credit card, but the key difference is it is not linked to a bank account but pre-loaded with a specific sum.  If your organisation is not already using them, here are seven good reasons why they should go straight to the top of your to do list.

• Employers can track expenses with ease

Issuing an employee with a conventional credit card gives them the financial autonomy they need to carry out their work, but it also doesn’t allow them to overspend or use the card for inappropriate purchases.  A prepaid credit card gives your employee the financial freedom they need but it enables you to track their expenditure in real time. Your employees’ awareness of this is also an incentive for them to use the card in an appropriate way.

• Employees can’t overspend

All your staff, from new employees to the most senior can be allocated a budget appropriate to their needs but they cannot spend more money than what has been pre-loaded.

• Employees don’t have to spend their own money

It is unreasonable to expect individuals to spend their own money on behalf of the company. It may create financial hardship for the individual and even if it doesn’t, it will generate a sense of annoyance which could encourage the submission of inflated expenses.  Providing employees with a prepaid credit card makes their working life easier and communicates a positive feeling of trust and responsibility.

• No foreign exchange fees

Prepaid credit cards can be loaded with a currency of your choice, meaning you can use your travel card anywhere in the world, enabling your employees to access expenses when working abroad without having to pay foreign exchange fees as they would with a conventional card. This is particularly advantageous for people who travel frequently, as small transaction fees can build up over time. The absence of these fees means significant savings can build up over time, which is a good option for budget-conscious travellers.

• Reduced risk

When you make online payments with an ordinary card, hackers can potentially access details such as the card number, billing address, security code and expiration date. A prepaid card is not connected to your bank details and therefore it cannot be traced.  If it is lost or stolen it can be frozen immediately without the need to freeze the whole account.

• Employers can set budgets

With prepaid credit cards employers can set individualised budgets for all employees.  Limits can also be set for expenditure on specific items such as accommodation and travel.

• The card can be linked to PayPal or Apple Pay

The security of a prepaid card makes it ideal for use online and employees can use it for subscriptions to professional journals, to order an Uber or to make purchases using PayPal or Apple Pay.

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