How Prepaid Business Debit Cards Make Expense Management Easier
Small businesses face obstacles every day. Managing company expenses doesn’t have to be one of them. See how prepaid business debit cards can help.
Small businesses have obstacles to tackle every day. Managing company expenses doesn’t have to be one of them, but if you aren’t keeping up with payment trends, issues around business spending can quickly evolve—from minor inconveniences to massive headaches.
According to the Federal Reserve Payments Study (FRPS), consumers and businesses chose to reduce in-person purchases last year. That poses a problem for an organization that relies on giving its employees cash for business purchases. But this problem can easily be solved with prepaid business debit cards.
What is a prepaid business debit card?
Prepaid business cards are pre-loaded with money and they’re much like any other card you’re used to handling. They present an ideal solution for a company that needs to provide employees with a way to spend money on behalf of the business but either can’t use a credit card or would prefer not to.
Basically, it’s like handing out petty cash for business expenses, except you load the cash to a prepaid card rather than hand out actual cash—which then allows your employees to make purchases online as well as in-store.
Plus, if credit debt and credit applications aren't something that you want to deal with, they’re a great alternative to corporate credit cards.
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How do these cards work?
The amount that you load onto a card establishes how much cash your employee (or contractor) can spend. Funds are available for employees to use as soon as cards are loaded. Since it’s a business card, the funds will come from a business bank account instead of a personal bank account.
Prepaid business debit cards usually don’t have large fees attached to them. That means businesses can be confident adding more cards or scaling up and down as their business needs change. No matter what stage your organization is at, these cards are a useful tool.
What are these prepaid business cards used for?
The flexibility of these cards is what makes them one of the best available options for efficiently and safely managing business expenses. The cardholder can use funds for anything that’s approved by the business. With ClearSpend Go Cards, companies can get super granular with spending limits and restricting what merchant categories are allowed.
Not sure what these different business expenses look like? They can include:
- Paying for fuel and travel
- Buying supplies
- Covering meals and business lunches
- Purchasing equipment or getting money for repairs
- Paying contractor costs
- Spending on training and education
For companies that need to provide funds for employees to cover business expenses, prepaid business debit cards are fast, effective, and safe. Transferring specific amounts onto a card make it easy to manage expenses and ensure budgets are kept.
Even better, there is no way for employees to overdraw the card beyond the pre-loaded funds. Businesses can keep tabs on where money is going and top the card up when they need to give employees access to more funds.
How prepaid business debit cards benefit small businesses
Beyond making it easy for employees to make necessary purchases, prepaid business debit cards offer small businesses several advantages to ease the finance-related burdens they face.
1. Simplify bookkeeping
One of the best features of these cards is that they allow businesses to see all expenses in one place, making bookkeeping much simpler and easier (especially compared to the spreadsheet hell many of us have been condemned to). With ClearSpend’s expense management tools, businesses can forever end time-consuming and horrifyingly tedious expense reports…and release your bookkeeper from spreadsheet hell.
2. Improve security
Since business debit cards have a limit on the amount of money that can be spent, they offer a higher level of protection against fraud and misuse of company funds—which is essential to small businesses that need to keep a close eye on cash flow. Plus, they’re much safer, easier to control, and more convenient than using cash or checks.
3. End the back and forth
If your employees don’t have a way to access company funds, they’ll often pay with their own money and then request reimbursement. This leads to unnecessary paperwork (cough…expense reports). Providing employees with their own cards gives them freedom while clearing brain space for overburdened bookkeepers. In some cases, it can even clear your bookkeeper’s desk, floor, and kitchen table from piles and piles of receipts and expense reports…which nobody wants to see.
Prepaid business debit card features
What should businesses expect from someone who provides these cards? To give you an idea, we’ll use our own prepaid business cards and connected expense management solution as an example.
Struggling to keep an eye on business funds? With ClearSpend, you can quickly create and fund budgets, then assign those funds to employee business cards. Our expense management dashboard tools then automatically track how those funds are spent and give you a snapshot of your budget vs spend in real-time.
Money’s always flowing in and out…but when it goes out, where exactly does it go? When spending from ClearSpend Go Cards, users can easily categorize payments in the ClearSpend mobile app or dashboard.
Don’t let your receipts get lost in the day-to-day shuffle (where they end up all crinkly and smelling weird after a few days). With the ClearSpend mobile app, users can upload receipts to as soon as a purchase is made. Receipts then end up in the dashboard, where they can easily be reconciled and managed in one place.
With ClearSpend, you can put a cap on the amount that employees can spend, plus control how they spend company funds. Along with daily, monthly, or per-transaction spending limits, ClearSpend allows you to approve different merchant categories for each card. For example, if you want employees to use the cards just for fuel, you could select “gas stations” as a merchant category. If your employee also wants to take a client out to dinner, you can simply add “restaurants” as an approved category for their card.
Need to get prepaid business debit cards, like, yesterday?
ClearSpend can get you up and running and dishing out cards fast. Unlike our competitors, we don’t require a credit check to get started, which allows you to get up and running quickly. ClearSpend is also easy to get started with and easy to use.
In addition, we give you the flexibility to set spend limits, pause, unpause, and close our free prepaid business debit cards at any time. So come see why small business owners, managers, and accountants from all walks of life are excited about ClearSpend.