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6 Reasons Why Employees Shouldn’t Use Personal Cards for Business Expenses

DiviPay Blog
June 02, 2022
By Ben GrossbergBen Grossberg
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From small organisations to large corporations, many employees are still using their personal cards to pay for business expenses. Not only does this create a burden for employees, it also creates losses for the business as well as their accounting managers. When personal cards are used by employees, business expenses become much harder to track and important decisions on cost management are impacted. 

Here are 6 of the key reasons why employees should not be using their personal cards for corporate expenses.

1. Employee reimbursement can be lengthy

Employee expense claims flow through the business at any time and any day of the week. Finance managers only have so many hours in their day, which means expenses can take weeks to be approved and reimbursed. 

Virtual corporate cards are one way to help reduce employee reimbursement timeframes. DiviPay’s virtual corporate card allows employees to easily submit claims through the app which are then automatically approved and processed based on pre-determined criteria. 

2. Business expenses should never impact your employees personal finances 

Using personal cards for corporate expenses can impact employee satisfaction and perception of their employer. Using a personal bank account and having to file an expense report is seen as an administrative hassle for many employees. Delays in reimbursement, convoluted expense processes and the knock-on effect to personal cash flow can cause financial stress for employees. 

At a time when there is a ‘Great Resignation’ in motion, reducing friction to improve employee satisfaction (and those NPS scores) is something important to think about. 

Many employees resent the burden of using their own card, the pressure of interest accruing on outstanding card bills as they wait for reimbursement and the potential negative effect using a personal credit card has on their credit score, should there be any delays.

3. You can’t control employee spending

Have you ever received an expense claim so outlandish it requires an sit down meeting with the employee? It’s not a fun time for either party involved. 

The Divipay platform is set up so you have complete control over the virtual cards and the spending limit for each employee – you can tweak the settings for each cardholder as necessary and with ease. 

Employees will have different responsibilities and needs for corporate cards, so it is likely that their spend will be different. With DiviPay, every employee can be assigned with their own spending limit and this can be adjusted by managers, instantly, as needed. 

4. You won’t have an accurate, real-time view of employee expenses

When an employee uses their personal card, the reimbursement process is delayed and expense reporting is impacted. Finance managers will never be able to know whether the expense data they’re looking at is up-to-date and accurate. 

With real-time expense tracking, you can easily check in on business spending, spot any issues as they arise and make decisions using clear and transparent data. 

5. Businesses will miss out of benefits and rewards 

Some employees prefer to use their own card as they can generate reward points, build their own personal credit score or get cashback. However, this means that businesses are missing out on their potential rewards provided by their financial partner. 

By centralising company expenses with virtual corporate cards, your business can properly track expenses and be rewarded accordingly, which can translate into benefits like discounted airline tickets, for example. 

All DiviPay users get exclusive access to a rotating set of our partner deals. DiviPay partners with leading software providers, co-working spaces and professional services such as The Commons, Canva and Google G Suite - just to name a few. 

Our rewards program is designed to give to you access to offers that hold genuine value for growing your business.

6. Virtual corporate cards are much safer

Unlike personal cards or traditional company cards, virtual cards do not have a physical presence. This makes them much safer, by removing the ability for employees to either lose the card or have it stolen. It also means the card cannot be passed around and potentially end up in the wrong hands. 

Losing a corporate card or having it stolen isn’t just a case of cancelling and replacing it like it would be for a personal card. With unrecognisable transactions and extra administrative time trying to replace the card, it can be a time-consuming process for finance teams. 

With DiviPay, employees that need access to a company card will be allocated their own virtual card which sits in their digital wallet. Any expenses will be attributed to their account, including software subscriptions and other necessary expenses, ensuring the finance teams always know where money has been spent and by whom. 

Additionally, all virtual cards can be cancelled with a couple of clicks, either when somebody leaves the business or does not need access to a company card anymore, making them a much safer option. 

The bottom line: Centralise your business expenses with DiviPay 

While optimising everyday processes with technology solutions and new ways of working can seem like a big upheaval, it really is worth it. By incorporating tools like virtual cards or expense management software, you can gain the key insights needed to understand exactly how the company is spending. And this information is invaluable when it comes to making decisions that increase efficiency and profitability.

With DiviPay, you can implement the tools you need to control spending before it happens, ensuring your business is safer and more streamlined when it comes to the company purse strings. 

Book a demo today and find out why more organisations are choosing virtual cards and spend management technology.