What are prepaid business cards? The best options
- How prepaid business cards work
- Best business prepaid cards
- Are prepaid cards the same as business credit cards?
- Are prepaid cards good for business?
- Alternatives to prepaid business cards
- Consider Ramp's corporate charge card for your business
A prepaid business card is a type of debit card that requires you to preload funds onto the card before you can use it for business purchases. The total amount you can spend is limited by how much money you have preloaded on the card. Once you've used up your balance, you'll have to load more funds onto the card to continue using it.
Let's look closer at prepaid business cards to see if they're right for your company.
How prepaid business cards work
A prepaid business card works just like a regular business credit or debit card. You can use them anywhere that accepts card transactions, including both physical stores and online retailers. Some prepaid cards also let you withdraw cash at ATMs.
Depending on the card issuer, you can fund your card through various methods, including bank transfer, direct deposit, or ACH. Some issuers offer employee cards that you can fund from your main account.
What is a prepaid business account?
A prepaid business account involves loading funds onto a card or account, which can then be used for business expenses. It operates similarly to a prepaid debit card, allowing businesses to spend only the amount that has been pre-deposited, and it's distinct from a traditional business bank account or credit line.
Best business prepaid cards
If you’re interested in using prepaid credit cards at your business, here are five options you can consider:
1. PEX Prepaid Expense Visa®
PEX Prepaid Expense Visa®
- Controls employee spending
- Real-time transaction tracking
- No credit check required
- Monthly fees apply
- Limited merchant acceptance
- No cash withdrawals
PEX has built its user base in the nonprofit and educational space, but they’re making inroads into the private sector with advanced technology and a modern user experience. They offer business pricing and reduced monthly and annual fees for nonprofits. PEX is unique in that there’s no limit to how much money you can preload into your account, although each card has a maximum limit.
- Features: Expense management, cardholder app, QuickBooks/data integration, API integrations, real-time reporting, live chat support, discounts for nonprofits
- Rewards: None
- Monthly fees for private sector businesses: $75–$200+ depending on the number of cards in use
- Monthly fees for nonprofits: $30–$80+ depending on the number of cards in use
- Maximum prepaid limit: $25,000 per card for private sector businesses; $5,000 per card for rewards and grants; no limit at the account level
Do prepaid visas work as credit cards?
No, prepaid Visa cards do not work as credit cards. They use funds you've already loaded onto the card, unlike credit cards which allow you to borrow money. Since they’re not a form of credit, prepaid cards won't build your business credit history.
2. dash™ Prepaid Mastercard®
dash™ Prepaid Mastercard®
- No monthly or per-card fees
- Unlimited number of cards
- Integration with accounting software
- Maximum card balance of $10,000
- No ATM cash withdrawals
- 3% fee on international transactions
A popular choice for small businesses, dash™ offers prepaid cards with an integrated app to track spending. It has no monthly fees, which makes it an attractive choice, but each card has a limit of $10,000, and you’re limited to a max of $100,000 in your main account. It’s also worth noting that you can’t use your dash™ card to withdraw cash or check your balance at an ATM.
- Features: Expense management, real-time reporting, live chat support
- Rewards: None
- Monthly fees: $0
- Maximum prepaid limit: $10,000 per card; $100,000 per account
3. Emburse Spend prepaid cards
Emburse Spend
- Easy virtual and physical card issuance
- Customizable spending controls
- Responsive customer support
- No ATM cash withdrawals
- Learning curve for new users
Emburse offers an expense management platform that integrates with their prepaid business cards. The platform lets you track spending, implement spend limits, and spin up an unlimited number of virtual cards for your employees. However, you can’t use Emburse cards at ATMs, and while the cards themselves are free, you’ll have to pay for a subscription to the Emburse Spend expense management platform. Emburse doesn’t publish pricing information.
- Features: Unlimited physical and virtual cards, expense management, real-time reporting, live support
- Rewards: 1% cashback on all purchases
- Monthly fees: No monthly fees for the cards themselves, but you’ll need to pay a subscription fee for Emburse’s SaaS platform
- Maximum prepaid limit: $100,000 at the account level, but you can request a higher limit, subject to approval
4. Bento for Business Card
Bento for Business Card
- Customizable spending controls
- Real-time expense tracking
- Integration with accounting software
- No free option
- No international coverage
- Delayed customer support response times
Bento for Business allows businesses to set spending limits, track transactions in real time, and issue virtual cards for added flexibility. The platform integrates with accounting software like QuickBooks, helping to streamline expense reporting and reconciliation. By enabling direct business-funded purchases, Bento reduces the need for employee reimbursements while maintaining oversight through its centralized dashboard.
Note that this card is currently being relaunched by U.S. Bank.
- Features: Spend controls, unlimited physical and virtual cards
- Rewards: 1% cashback on all purchases
- Monthly fees: Starts at $29 per month for up to 10 cards
- Maximum prepaid limit: Maximum of $25,000 per transaction per day
5. Pleo Prepaid Business Card
Pleo Prepaid Business Card
- Automated expense tracking
- Integration with accounting software
- Customizable spending limits
- Monthly fees per user
- Foreign transaction fees
- Occasional app performance issues
While primarily available in Europe, Pleo is a popular choice for businesses looking for a streamlined approach to corporate spending. Transactions are automatically categorized and can be integrated with accounting software, reducing the need for manual expense reporting. Pleo also provides automated receipt capture and reimbursement tools, making it a convenient solution for managing company expenses.
- Features: Spend controls, automated expense tracking
- Rewards: Up to 0.75% cashback on all purchases
- Monthly fees: Free for up to three users
- Maximum prepaid limit: ~$21,000 (€20,000)
Are prepaid cards the same as business credit cards?
Prepaid business cards and business credit cards have some notable differences. Prepaid cards are funded using your own bank account, whereas credit cards have a revolving credit line. Since the spending power of a prepaid business card is determined by your own funds, you don’t need a credit check to qualify for one. The downside is that prepaid business cards won’t help you build business credit.
Secured business credit cards operate similarly to prepaid cards insofar as you put down a security deposit that determines your spending limit. With both types of cards, you’ll need to replenish the balance when you run out to keep making purchases. Secured credit card issuers report to the business credit bureaus, making them a great option for building your credit score.
Are prepaid cards good for business?
Prepaid cards can help businesses manage expenses and control spending by providing a trackable way to distribute funds for travel, per diems, or project costs. They simplify budgeting, reduce reimbursement hassles, and offer a convenient payment option without relying on a business bank account or credit card.
What’s the maximum limit for prepaid credit cards?
The maximum amount you can load onto a prepaid business credit card depends on the card you choose, but the amount can range from a few thousand to tens of thousands of dollars. Many prepaid business cards allow you to hold up to $100,000 in your account but set much lower limits at the card level.
However, businesses should consider potential drawbacks, such as activation, maintenance, and transaction fees, which can add up. Prepaid cards also don’t build credit, making them less suitable for businesses looking to establish or improve their credit history. Companies should assess their financial needs to determine if prepaid cards align with their goals.
Here’s a closer look at the pros and cons of prepaid cards for businesses.
Benefits of prepaid business cards
- Easily control employee spending. Putting the entire budget for a long-term project in the hands of a manager might be risky. With a prepaid business card, you can set spend limits for each major milestone. This setup can also help manage cash flow for your sales team or marketing department. You can issue every card with a specific amount to keep expenses within set parameters, and many prepaid business cards offer the option of spinning up virtual cards as well.
- No lengthy reimbursement process. Traditional business expense systems require employees to use their personal cards for expenses. They then submit receipts for expense reimbursement, a cycle that can take weeks or even months to complete. That’s asking a lot from your employees. With a prepaid card, none of that is necessary. Employee expenses are covered by company funds on their prepaid cards.
- Cleaner accounting records for tax filings. Using prepaid business credit cards contributes to more organized accounting records. Each transaction is automatically recorded and categorized, simplifying the business expense tracking process for accurate and efficient tax filings. This can also be helpful should your business have to respond to an audit by the IRS.
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What are the disadvantages of having a prepaid credit card?
- You won’t build business credit. Prepaid cards don't contribute to your business's credit history. Unlike traditional business credit cards, using a reloadable prepaid card doesn’t involve borrowing against a credit limit or making repayments, which are key activities reported to credit bureaus that help build business credit.
- Inflexible funding limits. Because prepaid cards require you to preload funds upfront, they can tie up business capital. Additionally, the maximum amount you can preload onto a prepaid card is often lower than the credit limits offered by conventional business credit cards, which inhibits your ability to make larger business purchases.
- No rewards for spending. For small business owners, a cashback or rewards program is one of the most attractive features of business credit cards. Prepaid cards generally don’t offer rewards for spending.
Alternatives to prepaid business cards
Prepaid cards can help manage your money or employee spending, especially if you’re just starting out. But over the long term, they might not be the best choice for your business.
Corporate cards
Instead of being preloaded, corporate cards allow you to make purchases and accrue a balance up to a flexible spending limit, which must be paid in full at the end of each billing cycle. Like prepaid cards, they don't accumulate any interest.
Corporate cards come with added features, like expense management tools and finer controls for employee spending. They also report to the business credit bureaus, helping you build your business credit score, and they often come with rewards like cashback.
Discover Ramp's corporate card for modern finance
Business debit cards
A business debit card links directly to your business savings or checking account. It offers another way to track and manage business expenses without the risk of debt or interest, without the chore of preloading cards weekly or monthly.
These are useful for businesses that prefer spending only existing funds, but, like prepaid cards, business debit cards don’t help build credit, and they don't offer rewards.
Can I run a prepaid card as credit?
No, you cannot run a prepaid card as credit. Prepaid cards are loaded with your own funds and function like debit cards, drawing from that pre-existing balance. They do not offer a line of credit or allow you to borrow money, which is the defining characteristic of a credit card.
Consider Ramp's corporate charge card for your business
Ramp is more than just a business card. It’s a complete expense management solution that saves businesses an average of 5% a year.
In addition to providing corporate cards for your organization, Ramp comes with spend tracking, bill pay, accounting automation, real-time expense reports, and seamless integrations with your existing accounting, security, and collaboration tools.
Ramp has no setup fees, transaction fees, or interest charges, and we don’t require a personal guarantee or credit check. Nix the complexity of expense reimbursement, streamline your cash flow management, and get the buying power your business needs with Ramp.
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