Corporate Card

A corporate card is a payment card that a business arranges with a card issuer for its employees to use on business expenses, most often travel and entertainment, but also subscriptions, supplies and other day-to-day costs. The account belongs to the company or is opened under the company's programme, and the card carries both the employee's name and the company's. Spending is gathered into central reports so that the finance team can control budgets, check expense claims and pay the issuer.

Corporate cards are one type of commercial card, a family that also includes the purchasing card used for procurement and the fleet card used for vehicle costs. They run on the same card networks as consumer cards but are governed by separate commercial product rules, and they usually attract higher interchange than consumer cards in markets where commercial interchange is not capped.

A company signs a programme agreement with an issuing bank or a card provider. The agreement sets the total credit limit, the billing cycle, how statements are produced, which employees are eligible and who is responsible for payment. Individual cards are then issued to employees, each with its own limit and set of controls. Card data flows from the issuer into expense management software or the company's accounting system, where transactions are matched to receipts and coded to cost centres.

Many programmes now issue cards as virtual cards as well as plastic, allowing an employee to use a card number in a mobile wallet or for online purchases straight away. Newer providers combine cards with spending software that captures receipts by photo and reconciles transactions automatically.

Who must repay the issuer is the main structural choice in a corporate card programme:

• Corporate liability. The company is responsible for all spending on the cards and pays the issuer directly. This is common for larger firms that want central control.
• Individual liability. The employee receives the statement, pays the issuer and claims reimbursement from the employer. This shifts credit risk to the employee and is used where companies want employees to manage their own expense claims.
• Joint or shared liability. The company and the employee share responsibility, often with the company covering approved business expenses and the employee covering personal or unapproved charges.

Many corporate cards are structured as charge cards, meaning the balance must be paid in full each cycle rather than carried forward, which suits companies that do not want to borrow on their cards.

Programmes give finance teams detailed control over use. Common controls include spending limits per card and per transaction, blocks on certain merchant category codes such as gambling, restrictions on cash withdrawals and geographic limits. Approvals can be built into the software, so that unusual purchases need a manager's sign-off. Reporting covers spending by employee, supplier and category, which helps companies negotiate with travel suppliers and detect misuse. Some issuers supply enhanced transaction data, such as airline itineraries or hotel folio details, which improves expense coding and tax recovery.

Corporate card data also supports tax and audit work. Because each transaction carries a merchant name, date and category, auditors can test expenses more easily than with paper receipts.

For companies, corporate cards reduce cash advances and out-of-pocket spending by employees, speed up expense processing and give a short period of free credit between purchase and payment. Many programmes pay rebates based on annual spending. For employees, they avoid the need to fund business costs personally. Costs include annual or per-card fees, foreign transaction charges, late payment fees and the administrative work of running the programme. For merchants, corporate cards are more expensive to accept than consumer cards, which affects the cost of acceptance in sectors such as travel.

The main risks are employee misuse, such as personal spending or inflated claims, and external card fraud. Programmes rely on clear policies, regular review of statements, automated rules that flag unusual merchants or amounts, and prompt cancellation when employees leave. In some jurisdictions, consumer protection law applies only partly or not at all to business cards, so the programme agreement determines how unauthorised transactions and disputes are handled. Companies still have access to chargeback rights through the card schemes for goods not received or billing errors, subject to scheme time limits.