These days, business credit cards are a dime a dozen. There’s little that distinguishes one from the other. Most card companies recycle and rebrand the same features, points programs, and slogans. 


If you want your business to succeed, you can’t settle for just good enough. You must demand more in all aspects of your financial management and operations, including from your business credit card. Your corporate card can be more than just a payment method; it can eliminate manual expense management altogether.


Leveraging a business credit card with a built-in expense management solution can help your business in several ways:


  • Gain greater control over spending 
  • Save time on expense requests and approvals 
  • Reduce manual processes, data entry, and promote real-time accounting
  • Increase visibility into company spending in real-time
  • Increase financial reporting accuracy and prepare for tax season


#1 Gain Greater Control Over Spending

To properly gauge your expenses, it’s vital that you allocate and separate your spending by category. This provides greater visibility on where your money is going, making it easier to gauge ROI, and the restrictions on where money can be allocated helps prevent wanton spending.


In the past, this meant controlling company spending via employee expense reports. This created a time-consuming back-and-forth process that involved:


  1. Budgeting on what could be spent
  2. Working with various layers of management to determine what could be expensed
  3. Spending on employees’ personal cards, only to then submit an expense report that needs to be approved in order to be reimbursed


Nowadays, when you use a corporate card with built-in automated expense management software, all of this spending is tracked in real-time—no more waiting until month’s end. Plus, because the software is built into the card, when you issue physical and virtual cards to employees, you can set advanced controls like daily, monthly, or yearly limits and auto locked dates.  


This helps the:


  • CFO – Who will have greater visibility over the entire business’ expenses
  • Managers – Who will be more empowered to manage their team’s finances
  • Accountants – Who will be able to more effectively categorize, analyze, and reconcile expenses


When you only have one or two company cards, your finance team will be forced to waste time at month’s end attempting to parse out who spent what and where. The better approach is to have multiple cards (for each team or use case) with a dedicated spend management built right in. For instance, you could dedicate a unique card for all of the following expenses with set limits that recur on monthly, annual, or a custom basis (e.g. one-off purchases):


  • Advertising budget
  • SaaS subscription
  • Onboarding
  • Remote setup
  • Software trials
  • Meals ordered
  • Travel 
  • Wellness benefit 
  • Per diems


Having a card that automatically enforces your policies with a management software not only keeps your team in check, but also ensures that merchants aren’t overcharging you. 


#2 Save Time on Expense Requests and Approvals

When a card has automated expense management already built-in, you’ll save your team a ton of hassle and time on expense requests. 


Manual expense reports are time-consuming, error prone, and cause stress to employees and finance teams alike. According to the Global Business Travel Association, expense reports are a significant drain on company resources. A quick breakdown of the numbers demonstrates why: 


  • 20 minutes – The average time to complete a single expense report
  • $58 – The average cost of processing one expense report
  • 19% – The average percentage of expense reports that contain errors
  • 18 minutes – The average time to correct an expense report
  • $52 – To correct one expense report 


Per the survey, “These hidden costs can put a drain on company resources. Companies process an average of 51,000 expense reports each year meaning companies around the globe spend, on average, approximately half a million dollars and nearly 3,000 hours correcting errors in expense reports annually.” 


This monthly process tends to be a costly headache that no one wants to deal with. But automation helps relieve that pressure. For instance, certain corporate cards have the ability to: 


  • Automatically collect and match receipts 
  • Notify a manager and allow them to approve an expense instantly (even from Slack) 
  • Send reminders via SMS or email if employees are delinquent on receipt processing 
  • Categorize transactions directly into the company’s ledger 
  • Integrate with top accounting providers with one-click sync 


All of these features help you close the books faster—a process that once took days only needs to take a few hours. 


#3 Reduce Manual Processes, Data Entry, and Promote Real-Time Accounting

In the past, old school accounting methods relied heavily on manual systems and processes. 


Even advances like Excel are reliant upon manual data entry. Aside from the obvious issue with human error, such methods were slow and inefficient. It becomes difficult to have an accurate picture of your business expenses until the month’s end. If you are trying to cut business expenses, it’s important you know exactly what you’re spending as a small business owner. And, as Forbes notes, automation does things that your employees don’t want to be doing: 


“Automated processes are great for handling boring, repetitive, everyday tasks. About 10% to 20% of human work hours are devoted to computer-based repetitive tasks… When you give automation the brunt of these tasks, your employees can focus on more meaningful work.”


Automation makes it so you no longer need to wait until the end of a month to take stock of your financial data. Instead, you can track spending as it occurs. All transactions are automatically updated, logged, and categorized as they happen. This makes it possible to create an expense policy and ensure that the rest of the team is adhering to it. 


When you make the switch and convert to a real-time accounting system, you can: 


  • Immediately see income statements
  • Identify areas for cost savings
  • Improve cash flow management  


All of which position you toward success. 


#4 Increase Visibility into Company Spending in Real-Time

To be competitive, it’s important that you’re working with the most up-to-date financial information. Cash flow management requires you to know who’s spending what, where, and how much the instant it happens. With real-time visibility, you can immediately see every transaction, and then plan your finances accordingly. 


Leveraging a business credit card with expense management software offers several benefits, including: 


  • Grants the ability to gain a top-line view of your company’s expenses or zoom in on a single user (or transaction)
  • Empowers managers to better oversee and control their team’s expenses
  • Allow you to track every transaction, vendor, and trend because of distinct expense categories 
  • Helps your company make optimal decisions based on the most accurate and up-to-date financial information 


This gives you real, actionable insights regarding your spending habits. 


#5 Increase Financial Reporting Accuracy and Prepare for Tax Season

Tax season comes around every year. You know about it, so plan for it.


When you use a card with built-in expense management solutions, that process doesn’t need to happen solely at the end of the year. Instead, you can prepare for tax season on a daily basis. Automated software can help with tax season in several ways, including:


  • Eliminating the need for accounting teams to track down employees or critical documents 
  • Logging, categorizing, and matching receipts to each expense
  • Instantly generating reports and documents needed for tax prep
  • Organizing all tax-related documents into one accessible location 


Tax season doesn’t have to be a headache—at least not when you have technology to aid you. 


Ramp: The Corporate Card with Built-In Expense Management 

So, what is expense management? It’s the system your business uses to process, pay, and audit expenses. These days, you need a business card that automates expense management, helping you: 


  • Gain greater control over spending 
  • Save time on expense requests and approvals 
  • Reduce manual processes, data entry, and promote real-time accounting
  • Increase visibility into company spending in real-time
  • Increase financial reporting accuracy and prepare for tax season


But not every corporate card comes with expense tracking or a built-in expense management system. 


Only Ramp’s does. 


At Ramp, our mission is to help you take back control of your finances. We’re the smarter way to handle your accounting. With our smart card, you can optimize your expense management, saving time and money in the process. 


Ready to get started? Sign up today. 



Sources:


Global Business Travel Association. How Much Do Expense Reports Really Cost a Company? https://www.gbta.org/blog/how-much-do-expense-reports-really-cost-a-company/


Forbes. Why You Should Have An Automation Frame Of Mind When It Comes To Your Real Estate Business. https://www.forbes.com/sites/forbestechcouncil/2020/02/03/why-you-should-have-an-automation-frame-of-mind-when-it-comes-to-your-real-estate-business/#6dfdea7453ed