These days it can get very confusing when it comes to paying for anything and everything. But, with so much choice, your head might be getting in a spin when it comes to what’s what, so we’ve taken the hassle out of the mix and put together an article on the difference between five payment cards for your business.
Business Credit Card
A business credit card is a card exclusively tailored for entrepreneurs, offering unique benefits tailored to the business. Business cards typically have higher credit limits, greater rewards potential, and tools to help manage spending and employee cards.
Business owners still need to cover fixed costs, such as rent and utilities, even if their business is cyclical (for example, snow removal, which is only in high demand in winter). They can use a business credit card to mitigate such cash flow fluctuations. A business credit card can also provide entrepreneurs with quick funding in case of a business emergency.
Corporate Debit Card
Debit cards are payment cards linked to financial accounts. Some corporate debit card products distinguish between these and prepaid accounts, allowing easy loading of funds onto the card. However, business debit cards are usually not linked to banks and other traditional financial institutions. The main difference is that these cards are designed for business purposes, such as allowing your employees to spend money on official travel.
A corporate debit card eliminates the need for employees to spend personal money on travel and entertainment and then be reimbursed for those expenses. It also eliminates the need to approve signatures for every purchase, which can be tedious and inconvenient. Company cards can be issued to employees according to their needs and roles. The cards can be managed through an online system with the ability to control daily limits, types of purchases and authorized periods of use.
Virtual Payment Card
Virtual credit cards, sometimes called a temporary card number or pseudo card number, have been around in one form or another for years now and their use has certainly taken off among consumers and companies since the pandemic. There are few differences between virtual payment cards and debit.
First of all, the main dissimilarity is that there is no physical carrier. The second difference is that virtual payment cards are single-use credit cards, which provide various alias credit card numbers for the same account, typically your existing credit card account. In this method, your real account number is never revealed to the merchant. Then, if you use a virtual payment card for your medical bills, your auto payment, and your company transactions, a different account number would be used for each of those vendors, but all of the numbers would be linked to the same base account.
Individual Virtual Cards are not only popular with individual users, but we also can see how companies are switching to virtual credit cards and according to a recent survey, more than 25% of Fortune 100 companies are now using virtual payment cards. This trend toward virtual cards has significant reasons and key benefits. Thus, the potential for growth is impressive. A 2021 report by Juniper Research predicted that virtual card spending would top $6.8 trillion dollars by 2026, up from $1.9 trillion in 2021.
Business Prepaid Card
With a prepaid credit card, companies can set a spending limit because they have to provide the funds, not the card provider or financial institution.
The difference between prepaid cards and other types is the possibility to load a certain amount of cash on them. Therefore, if employees want to buy more than the balance on the card, they are not able to do it.
A big pro of a business prepaid card is no need to provide your credit history or financial statements with a prepaid business card. Because you aren’t borrowing money from a lender, you won’t undergo a credit check to receive a prepaid card.
Purchasing Cards (P-cards)
A company purchasing card (p-card) is a company debit card used by employees to purchase goods on behalf of the company. Purchasing cards can be used whenever a purchase order, check request, or petty cash would have been processed and with any vendor that accepts credit cards.
P-cards are mainly used for purchases that are too small to go through the ordering process. Purchase cards are more effective for small transactions because they allow employees to bypass the application and approval process, which can take days or weeks.
P-cards are useful for businesses that need to make small purchases but can't or don't want to issue a separate card for each employee. They are also useful for paying for business travel, such as booking flights and hotels.
What card is the best fit for your business?
After looking at all these cards, you may wonder how you can find a card that will be the best fit for your business? We, at Jenji, are sure that the perfect solution to optimize the management of your business expenses should be Flexible, easy to use and secure ! That's why we created Jenji Pay.
The Jenji Pay card is used on a daily basis to support the development of your business. Based on the Visa network, the solution is accepted by all merchants. It adapts to the profiles and needs of each person through its different formats, both physical and virtual. Jenji Pay provides flexibility both in the act of payment and in operational management. For each type of use, limits and permissions can be personalized. You have total control over the transactions and fees generated by your employees.
Are you curious and would like to know more? Get in touch with us at sales@jenji.io
